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'More plot twists than Game of Thrones' seen in Clean Power Plan litigation

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'More plot twists than Game of Thrones' seen in Clean Power Plan litigation

The U.S. EPA's Clean Power Plan's legal saga has had"more plot twists than Game of Thrones," according to attorney DavidDoniger of the Natural Resources Defense Council.

A week after the U.S. Court of Appeals for the District ofColumbia Circuit heard oralarguments, attorneys and energy policy experts on both sides met atthe Bipartisan Policy Center in Washington, D.C., to discuss the legal casethat has seen unprecedented action from both the federal appeals court and theU.S. Supreme Court.

While the experts were evenly split between opponents andproponents of the Clean Power Plan, all agreed that the D.C. Circuit court'sjudges were highly prepared and engaged during the nearly seven hours ofquestioning Sept. 27.

"The importance of the issue of climate change reallyhung in the air throughout the day," said Christophe Courchesne, chief ofthe environmental protection division at the Massachusetts Attorney General'soffice. "There was a sense that there was a gravity to this issue, bothnationally and globally, and that the judges shared that understanding … evenif there were disagreements and a lot of discussion about the legal issues."

Jeff Holmstead, a partner at the law firm Bracewell LLP whois representing the American Coalition for Clean Coal Electricity in the case,said the decision to hear the rule en banc and the complete disregard shown tothe original oral argument schedule suggests the court is aware of thesignificance of the carbon-cutting rule.

"If you took the passion about climate change out ofthis case, and you took all of the background and you just gave the statute to100 neutral judges, 100 judges would say this is illegal," Holmsteadinsisted.

The panel also agreed that the most important issuepresented to the court was the shifting of power generation from a coal-firedand other higher emitting power plants to low- or non-emitting plants like windor solar.

Holmstead said the EPA has never before asked the owner of apower plant to directly subsidize the operation of another facility, and if theEPA is seeking such authority, Holmstead said legal precedent suggests thatCongress should amend the Clean Air Act, rather than the EPA issuing aregulation unprompted by lawmakers. Holmstead has previously served as anassistant administrator for the EPA under President George W. Bush.

The Department of Justice, arguing on behalf of the EPA,told the judges that generation shifting has been used in regulatory programsbefore, such as under the Cross-State Air Pollution Rule. But Allison Wood, anattorney for Hunton & Williams LLP who argued on behalf of industry tradegroup Utility Air Regulatory Group, said the difference is that the Clean PowerPlan forces states to adopt generation shifting.

"There is a key difference between those rules that dohave trading as a component, which is that the generation shifting happens as aresult of the rule," Wood said. "The Clean Power Plan is completelydifferent. The generation shifting is baked into the rule. It is actually therule itself."

Doniger argued that some in the environmental movement mighteven find the Clean Power Plan too lenient on power plants, which could havebeen a legal challenge in itself. But he said the point of the Clean Air Act isto regulate pollution, and in issuing the Clean Power Plan, the EPA was simplydoing its job as mandated by Congress.

"The very idea of the Clean Air Act is putting limitson pollution that the marketplace doesn't deal with. In this case the marketplaceis pushing in the right direction, but the Clean Power Plan is pushing — as itshould — somewhat farther," Doniger said. "When [power plants] get touse the atmosphere for free they have a subsidy ... in the form of our healthand our climate. One can play the subsidy argument in both directions. It's nota Germanic compound noun, generation shifting, it is what happens when oneplant is more expensive to operate than another plant."

The experts were split on whether the D.C. Circuit willissue a ruling before or after Inauguration Day on Jan. 20, 2017. With 10judges deciding the case, Holmstead said the ruling could be a 5-5 splitdecision. Should the Supreme Court take the case and also split 4-4, the rulewould once again be in uncharted territory. In that situation, the rule wouldbe upheld.