Unpacking EME Homer: Cost, Proportionality, and Emissions Reductions

Interstate air pollution can prevent even the most diligent downwind state from attaining the air quality levels required by federal law. Allocating responsibility for emissions cuts when multiple upwind states contribute to downwind air quality violations presents a particularly difficult problem. Justice Ginsburg’s opinion for the Court in EPA v. EME Homer City Generator, L.P., gives EPA broad discretion to craft regulatory solutions for this problem. Although the specific statutory provision at issue was deceptively simple, the underlying problem was especially complex because of the large number of states involved. Indeed, neither the majority opinion nor the dissent seems to have fully grasped how allocation would work even in some of the simplified numerical examples discussed by the justices. Although the specific question before the Court is now settled, the Court’s holding has continuing ramifications. It will shape further development of EPA’s ongoing efforts to deal with interstate pollution, but it also has broader implications for the role of cost under federal pollution laws. In addition, the decision may have significant implications regarding EPA’s flexibility in mandating state plans to reduce carbon emissions under sections 111(d) and 115 of the Clean Air Act.