Biden ‘cost of carbon’ policy survives another legal hurdle
New Orleans – In a victory for President Joe Biden, a federal appeals court Thursday refused to revisit its March decision reviving administration plans to account for potential damage from greenhouse gas emissions when creating rules for pollution-generating industries.
A Louisiana-based federal judge had blocked the so-called social cost of carbon policy earlier this year, saying it would bring costly regulatory burdens and drive up energy prices. But a panel of three 5th U.S. Circuit Court of Appeals judges in New Orleans unanimously stayed the lower court last month. On Thursday, the appeals court issued a brief order saying none of the court’s 17 full-time judges sought a rehearing, which had been requested by Louisiana Attorney General Jeff Landry.
Landry led the challenge on behalf of Louisiana and nine other states.
“We are disappointed in the 5th Circuit’s decision and we will appeal to the Supreme Court,” a statement from Landry’s office said.
Alabama, Florida, Georgia, Kentucky, Mississippi, South Dakota, Texas, West Virginia and Wyoming joined Louisiana in the challenge.
The policy aims to put a dollar value on damage caused by every additional ton of greenhouse gases emitted into the atmosphere. That cost estimate would be used to shape future rules for oil and gas drilling, automobiles, and other industries, and a higher estimate could justify more stringent rules.
On his first day in office, Biden issued an order that restored the cost estimate to about $51 per ton of carbon dioxide emissions after the Trump administration had reduced the figure to about $7 or less per ton. Former President Donald Trump’s estimate included only damage felt in the U.S. versus the global damage captured in higher estimates that were previously used under the Obama administration.
Republicans and business groups have questioned the accuracy of the complex economic models used to determine the cost estimate. They argue that an emphasis on future climate damage would hobble the economy, particularly the energy industry.
The 5th Circuit panel said in last month’s ruling that any regulatory burdens the policy might bring are speculative at this point and that Louisiana and other states challenging the policy therefore had no standing to sue. It said U.S. District Judge James David Cain, a Trump appointee in Louisiana’s Western district, had gone “outside the authority of the federal courts” in ordering the Biden administration “to comply with prior administrations’ policies on regulatory analysis absent a specific agency action to review.”
The ruling panel included judges Leslie Southwick, appointed by Republican President George W. Bush, and James Graves and Gregg Costa, both appointed by Democratic President Barack Obama. Of the 17 full-time judges on the court, 12 were nominated by Republican presidents – six of those by Trump.