The U.S. Supreme Court recently ruled in favor of fuel producers challenging California’s strict vehicle emissions standards under the federal Clean Air Act, reviving a lawsuit that had been dismissed by a lower court.
The Supreme Court’s decision, with a 7-2 ruling, allows companies harmed by EPA decisions to challenge regulations in court, highlighting the court’s skepticism towards broad federal agency power, especially in environmental regulation and EPA authority.
Driving the news: The legal dispute centered on an exception granted to California to set its own vehicle emission standards under the Clean Air Act, despite general preemption of states and municipalities in enacting such regulations.
- The fuel industry groups and a Valero Energy subsidiary challenged the EPA’s decision to allow California to set its own regulations, arguing that it exceeded the agency’s power under the Clean Air Act and adversely impacted their business by reducing demand for liquid fuels.
- The U.S. Court of Appeals for the District of Columbia Circuit had previously dismissed the lawsuit in 2024, citing that the challengers lacked the necessary standing to bring their claims as it would not affect auto manufacturers’ decisions on the types of vehicles sold.
- California has received over 100 waivers under the Clean Air Act, allowing the state to implement its own emission standards.
The big picture: The Supreme Court’s conservative majority has shown a tendency to limit federal regulatory agencies’ authority in recent years, including restricting the EPA’s power to reduce ozone emissions, protect wetlands, fight water pollution, and regulate power plant emissions under the Clean Air Act.
- Justices Sonia Sotomayor and Ketanji Brown Jackson dissented from the Supreme Court’s decision, highlighting a split in opinions among the justices.
