On January 19, 2021, the United States Court of Appeals for the D. C. Circuit issued an Order vacating U.S. EPA’s 2019 Affordable Clean Energy Rule (ACE Rule). The 2019 ACE Rule replaced the 2015 Clean Power Plan as a means of regulating greenhouse gas (GHG) emissions from power plants. The Court held that, while U.S. EPA has the authority to regulate GHG emissions, “the central operative terms of the ACE Rule . . . hinged on a fundamental misconstruction of Section 7411(d) of the Clean Air Act.” The Court also held that the extended compliance schedules for reducing GHG emissions under the ACE Rule are arbitrary and capricious.

Per the Court’s Order, the ball is back in U.S. EPA’s court to develop and implement a new regulatory framework for GHG emissions from power plants. We will continue to monitor this issue and will report on any new developments.