The Environmental Protection Agency's plan is meant to reduce climate-changing greenhouse gas emissions by targeting existing coal-fired and natural gas power plants with a goal of reduce greenhouse emissions up to 32% by 2030. It would require states to meet specific carbon emission reduction standards based on their individual energy consumption, and it includes an incentive program for states to get a head start on meeting standards on early deployment of renewable energy.
Dozens of lawyers from the government, industry and public interest groups packed the US Court of Appeals for the DC Circuit, to hear the divisive case that comes just weeks before a heated presidential election and illustrates how a President's picks for the lower court might impact his own agenda.
The plan is currently frozen because last February, the Supreme Court voted to delay implementation until the appeals process could play out.
Opponents to the plan claim that the EPA went too far under the law to push the rule.
Judge Brett M. Kavanaugh at one point questioned EPA's authority.
"This is a huge case," he said and noted that it could "fundamentally" transform the industry. Kavanaugh said the administration's policy is "laudable" but questioned under the separation of powers whether Congress, and not the EPA, had to speak clearly on the issue.
Judge Thomas B. Griffith chimed in asking, "why isn't this debate going on in the floor of the Senate?" rather than before a panel of judges. But Judge Patricia A. Millet reiterated at one point that the Supreme Court "has already said" that the EPA has the authority to regulate in the area.
Other judges questioned whether by 2030, the rule would be any more transformative to the coal industry, for example, than market forces would be.
Judge David S. Tatel asked whether the agency was simply "invoking existing authority."
While the morning session in court was dedicated to statutory arguments, in the afternoon the court heard arguments concerning whether it was unconstitutional. The challengers' constitutional arguments did not appear to to get much traction with the judges.
On one side is the EPA, 18 states, some power companies and environmental and public health groups who argue in briefs that the rule will "secure critically important reductions" in carbon dioxide emissions from what are by far "the largest emitters in the United States -- fossil-fuel-fired power plants."
They argue that the emissions "pose a monumental threat to American's health and welfare by driving long-lasting changes in our climate leading to an array of severe negative effects."
The plan is considered important for the US to meet goals set out in a climate treaty signed in Paris last December.
On the other side are nearly two dozen states, electric utilities, coal mining companies and the Chamber of Commerce.
They say the rule exceeds the agency's statutory authority and goes beyond the bounds set by the Constitution.
"EPA's audacious assertion of authority in this rule is more far-reaching than any previous effort by the agency," lawyers for the opposing states argued in court papers. They say that the reduction requirements "can be met only by shutting down hundreds of coal-fired plants, limiting the use of others, and requiring construction and operation of other types of facilities preferred by EPA."
In a statement back in February, White House press secretary Josh Earnest said,. "The Clean Power Plan is based on a strong legal and technical foundation, gives states the time and flexibility they need to develop tailored, cost-effective plans to reduce their emissions, and will deliver better air quality, improved public health, clean energy investment and jobs across the country."
By the end of the day, after more than a dozen lawyers had approached the podium, and Judge Karen Henderson acknowledged everyone's long day. "We've all been through a marathon," she said.
Court filled with Obama appointees
During complex arguments before a multi-member court is dangerous to try to determine -- based on questions posed at oral arguments -- how a judge will ultimately rule. It's worth noting however, that Tuesday's case comes before an appellate court that has been transformed during the Obama administration.
Before Obama took office the appeals court tilted toward conservative appointees with six judges nominated by a Republican president and three nominated by a Democratic president. There were also two vacancies.
Currently, the active judges on the court consist of four GOP appointees and seven Democratic appointees. In 2013, Obama placed four judges on the court, three of them immediately after the Senate changed its filibuster rules. Tuesday's case was heard by all the active members of the court except for Chief Judge Merrick Garland who has recused himself from hearing cases because he has been nominated to the Supreme Court.
"The party of an appointing president surely makes a difference in some types of cases -- environmental for example -- more than others," said Russell Wheeler, a visiting fellow at the Brookings Institute. "When the full court meets is when the party of appointing president is likely to matter most because the great majority of decisions are made by three-judge panels, randomly drawn and not necessarily reflective of the overall composition of the court."
Because the Supreme Court is currently at a reduced strength of eight the appeals court opinion could be the last word on the subject. A 4-4 tie at the Supreme Court would mean the justices automatically uphold the lower court's opinion.
Elizabeth Wydra of the progressive Constitutional Accountability Center says that the appeals court is "exhibit A" of why judicial nominations are crucial to a president's legacy.
"President Obama was able to put several brilliant legal minds on the bench, who are much more likely to follow the law where it leads rather than accept the extreme conservative deregulatory agenda pushed by this case," she said.