WASHINGTON, Jan 19 (Reuters) - A federal court on Tuesday struck down the Trump administration's scaled-down replacement of the Obama administration's signature climate change regulation for power plants, a final blow to its environmental deregulatory agenda on President Donald Trump's last day in office.
The U.S. Court of Appeals for the District of Columbia Circuit decided unanimously to toss the Environmental Protection Agency's Affordable Clean Energy rule, which constrained how carbon emissions from power plants are regulated, and remanded it to the agency, which will prioritize climate change under the incoming Biden administration.
The decision to strike down the rule was made by a three-judge panel comprised of two Democratic appointees and one Trump-appointed judge.
They considered whether the federal Clean Air Act requires the EPA to limit new rules to reduce emissions to a particular power plant, the way the Trump EPA interpreted it, or if the agency can take a sector-wide approach to regulating emissions.
"Because promulgation of the ACE Rule and its embedded repeal of the Clean Power Plan rested critically on a mistaken reading of the Clean Air Act, we vacate the ACE Rule and remand to the Agency," the judges wrote.
The decision comes after a full day of arguments in the D.C. Circuit court in October in which environmental groups and Democratic-led states maintained that the repeal of Obama's Clean Power Plan, which never took effect under Trump, was illegal and Republican-led states and industry groups supported Trump's EPA.
The decision could empower incoming leaders of the EPA to take an aggressive approach as it returns to the drawing board to regulate carbon emissions from power plants.
"They will be unencumbered by some of the artificial constraints [on regulating the sector] that the Trump EPA invented," said Environmental Defense Fund senior attorney Ben Levitan.
(Reporting by Valerie Volcovici; additional reporting by Lawrence Hurley; Editing by Dan Grebler)
