The Environmental Protection Agency can regulate emissions after all, a court has ruled.
The U.S. Court of Appeals for the District of Columbia on Tuesday reversed its July decision and reinstated the Clean Air Interstate Rule. The EPA implemented the rule in 2005 to reduce sulfur dioxide and nitrogen oxide emissions from power plants.
The rule also created a cap-and-trade program for companies to buy and sell emissions allowances. States can require companies to participate in the program, or find other ways to force the companies to cut emissions.
In July, the court invalidated the rule in a controversial decision and determined that the Clean Air Act didn't give the government the ability to create regulate the emissions or create the cap-and-trade program.
This week, the court said it changed its mind after hearing more arguments from the EPA, elected officials and environmentalists, and decided that it was better to keep the rule in place until the EPA fixes its problems.
The rule that has been reinstated requires 28 eastern states and the District of Columbia to reduce those emissions that cause smog and soot. The EPA said the rule would reduce the sulfur dioxide emissions across the states by over 70 percent and nitrogen oxide by more than 60 percent from the 2003 levels.
The agency estimated that the rule would lead to $85 billion to $100 billion in health benefits each year by 2015.
The court's original decision in July dealt a setback to both critics and supporters of the rule. Critics had wanted the court to fix what they said were loopholes in the regulation, not to nullify it all together.
North Carolina Attorney General Roy Cooper filed the lawsuit in 2005, contending that the rule didn't come with the proper mechanism to reduce emissions since companies could buy credits through the cap-and-trade program if they wanted to emit more than allowed.
Cooper filed the suit after the EPA denied his request to force coal-fired power plants from 13 other states to cut emissions. Cooper said emissions from those power plants were drifting into North Carolina and hampering the state's ability to achieve its own clean air goals.
The EPA said it denied Cooper's request because the Clean Air Interstate Rule would eventually produce the results sought by Cooper.