Washington (CNN)In a loss for the Obama administration, the Supreme Court ruled that the EPA unreasonably interpreted the Clean Air Act when it decided to set limits on the emissions of toxic pollutants from power plants without first considering the costs of the industry to do so.
The Obama administration argued that air pollutants like mercury and arsenic are associated with birth defects, cancer and other risks, especially for pregnant women and children. They say coal and oil fired power plants are the single biggest contributor to mercury contamination of rivers and lakes.
The Clean Air Act directs the EPA to regulate hazardous pollutants from power plants if the regulation is found to be "appropriate and necessary."
The EPA determined it was appropriate to regulate coal and oil fired power plants.
At issue in this case was whether the EPA violated the Clean Air Act when it declined to consider costs in determining whether it was appropriate to regulate hazardous air pollutants.
Twenty-three states and some in the industry argued that the EPA should have considered costs when making a threshold determination on whether to regulate.
"EPA's decision that it is 'appropriate' to achieve $ 4 million to $6 million in health benefits at a cost of $9.6 billion is not reasonable, imposes great expenses on consumers, and threatens to put covered electric utilities out of business," lawyers for Michigan and 22 other states argued in Court briefs.
Opponents in the industry said that under the EPA rule the industry will be forced to spend billions of dollars to regulate conventional pollutants that are already regulated under other Clean Air Act programs.
On the other hand, the EPA argued that it didn't take costs into consideration initially because the threshold decision is meant to be based on public health alone. Lawyers for the agency said that once it was determined that the air pollutants from coal and oil fired power plants posed a major hazard to public health they moved to the next stage of process under the Clean Air Act to determine what the limits on these pollutants should be. When they considered that issue, they did take costs into consideration.
"EPA did exactly what the Clean Air Act requires," said Neil Gormley a lawyer with Earthjustice DC a group that filed a brief in support of EPA. "The agency correctly focused on public health initially and considered costs once it had the information it needed."
"When you add up all the costs and all the benefits, " Gormley said. "The health benefits of this rule dwarf the costs to the industry. The public gets $9 dollars of health benefits for every $1 dollar the industry spends."
