The Nickel Report

In Michigan v. EPA, 135 S. Ct. 2699 (2015), the Supreme Court held that the cost of regulation is an essential factor that EPA must consider when deciding whether to regulate.  Id. at 2707.  According to the Court, “[a]gencies have long treated cost as a centrally relevant factor when deciding whether to regulate.”

In subsequent regulatory proceedings, however, EPA has offered different views as to what Michigan’s cost mandate means.  At the end of the Obama Administration, EPA said Michigan only means that it need determine whether the costs of a regulatory action are “affordable” or can be “absorbed” by the regulated industry.  81 Fed. Reg. 24,421.  More recently, EPA has said that its earlier statement “does not meet the statute’s requirements to fully consider costs,” and that the Supreme Court’s decision in Michigan requires that it “meaningfully consider cost within the context of a regulation’s benefits.”  84 Fed. Reg. at 2675.