The EPA's "Clean Power Plan" will for the first time impose greenhouse gas emission limits on existing fossil fuel power plants.' The Plan envisions trading among regulated emitters, and such trading appears crucial to the Plan's cost-effectiveness. The Plan's projected emissions reductions are significant, making it a core element of President Obama's climate policy and crucial to fulfillment of the country's international commitments. But the Plan is controversial and is based on a rarely used provision of the Clean Air Act, § 111 (d). Litigation has already begun and will undoubtedly intensify. In an earlier work, I argued that § 111 (d) does not allow use of some flexible regulatory tools (including many forms of offsets) but that it appears to allow emissions trading among regulated sources. This Article looks more deeply at the legal authority to allow emissions trading under § 111 (d). Most legal arguments to date over trading have focused on past EPA practice or the statutory definition of performance standards. But neither source of authority is sufficient to answer the question-in fact, there is little or no statutory guidance on whether trading is legally available when emitters must actually comply. Judicial deference to agency interpretation means trading may be legal, but uncertainty remains. It is even possible that courts could resort to new legal doctrines or revive the nondelegation doctrine to resolve the question. Even if courts do eventually approve trading, legal uncertainty over this crucial aspect of climate policy is underappreciated.



To view the content in your browser, please download Adobe Reader or, alternately,
you may Download the file to your hard drive.

NOTE: The latest versions of Adobe Reader do not support viewing PDF files within Firefox on Mac OS and if you are using a modern (Intel) Mac, there is no official plugin for viewing PDF files within the browser window.