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The Supreme Court's New EPA Case Has More to Do With Climate Change Than You Think

Alex Wong/Getty Images

The Supreme Court agreed on Tuesday to review an Environmental Protection Agency regulation limiting how much mercury, arsenic, and other pollutants coal-fired power plants can emit. The case is clearly important because of the health benefits—humans exposed to mercury are at risk for a host of health conditions—but there is another issue at stake. The rule, known as the Mercury and Air Toxics Standard, (MATS) will help determine how many coal plants retire over the next few years, making it a meaningful part of President Barack Obama’s second-term goals on climate change.

To reach Obama's goal of lowering U.S. greenhouse gasses by 17 percent by 2020, and by as much as 28 percent by 2025, the economy will have to move away from coal. The decision to retire plants depends largely on economic factors outside of the EPA's control, particularly how the low price of natural gas drives down demand for coal. But environmental regulations are also important factors in how quickly coal plants close, even when they don't directly target greenhouse gas emissions directly.

For some utilities, the mercury rule will not impact decisions to retire coal plants. According to the U.S. Energy Information Administration, by 2012 nearly two-thirds of electricity capacity powered by coal met the environmental standards for mercury—these plants will not shut down. About 10 percent, most of which are the oldest facilities, have said they will retire because it's too expensive to meet the standard. The remaining 20 percent is a question mark. These plants will either need to retire or upgrade with new pollution controls. That decision will be largely impacted by economic factors, like the price of natural gas remains, which is out of the EPA’s control.  

"The elimination of the mercury rule would make it more challenging to achieve the administration’s CO2 targets,” Robert Stavins, the director of the Harvard Environmental Economics Program, wrote by email. “The mercury rule (MATS) will have very significant economic impacts on coal plants in terms of retarding investment."  

Although the EPA issues individual rules for different emissions, the fact is that these regulations are all interrelated. Rules that target non-greenhouse gases nonetheless become factors in meeting U.S. climate pledges. They can help reduce other kinds of emissions, which lowers the cost of compliance of other standards. For example, the EPA says the mercury rule will also help states meet a brand-new proposal on ozone, by affecting plant retirements and decisions to upgrade technology.

In one good sign for Obama and the EPA, the agency had a relatively good track record last year defending its clean air regulations at the Supreme Court. Last April, the justices ruled 6-2 that the EPA could regulate smog crossing over state lines.