The DC. Court of Appeals began hearing arguments recenlty in an historicsession taken "en banc" - with a roster of 10 judges hearing a case that challengesPresident Obama's Clean Power plan. Specifically, some industry associations arechallenging new targets for coal plants that would require a 32 percent reduction incarbon emission by 2030. More generally, the case highlights challenges to Obama'suse of his executive powers to regulate the electricity industry in a way that willhelp the US meet international targets for reduction in carbon emissions. Obama's use of the Clean Air Act to bring his Clean Power Plan to fruition has beencalled "vast legal overreach" by some law professors who have said it is tantamountto burning the constitution. While it may take weeks or even months for the court to rule, the case highlights theextreme importance of keeping U.S. plans to reduce emissions on track in order tospur continued global cooperation on global warming. With the U.S. electioncontinuing to create its own heat, there are many interlocking and swiftly movingpieces on the global climate change front. The world needs continued leadership from the U.S. and a ruling by the court thatObama had overreached would impact progress globally. The hearing comes on the heels of last November's Conference of the Parities onClimate Change in Paris (COP-21) where more than two decades of difficult and verytenuous multilateral negotiations on collective action on climate change concludedin a delicate compromise. The effectiveness of this agreement hinges on nationsadhering to - and eventually ratcheting up - their nationally determinedcontributions (NDC). Other big emitters are living up to their commitments. India,for example, is set to ratify its COP-21 contributions next month on the historicoccasion of Gandhi's birthday, October 2; just last month, China's President XiJinping announced the ratification of China's COP-21 commitments in a joint pressconference with President Obama. China and India rank first and third, respectively,in global greenhouse gas emissions. The U.S. ranks second. Combined these threecountries account for nearly one-half of all emissions. Domestically, some observers have claimed that the court case and the Clean PowerPlan no longer matter because market forces are driving reductions in the powersector even absent policy constraints. What they overlook, however, is that marketforces such as low natural gas prices are unpredictable and the fortuitous dynamicsthat have allowed substantial carbon reductions in the U.S. could change,jeopardizing further progress. Policies do matter - they signal a formal commitmentthat provides certainty to investors when deciding about very long-term, capitalintensive bets in the energy sector and provide reassurance to our partners in theinternational community who judge our earnestness in tackling global climatechange by the credibility of our policies. The Clean Power Plan is widely acknowledged as pivotal to achieving the U.S. Pariscommitments, as it is the single policy with the largest abatement impact thatObama or any other U.S. administration has implemented to date. The internationalcommunity is therefore carefully monitoring the fate of the Clean Power Plan, and ifthe latter were to be deemed unlawful/vacated in court, that will send asignal to other major emitters such as India and China that the U.S.' commitment tothe Paris Agreement cannot be backed up by commensurate action. As we moveforward in a few short weeks to flesh out the Paris Agreement in Marrakesh(COP22), a major setback in the second-largest emitter worldwide could have hugeramifications. The United States is the only signatory to the Paris Agreement whosecommitments are subject to a domestic legal challenge. As a result all of us arewatching and waiting for a decision that could change the course of climate change,for better or worse. Joshua Hodge is the Executive Director of the Center for Energy and Environmental Policy Research at the Massachusetts Institute of Technology.
Christopher Knittel is the William Barton Rogers Professor of Energy Economics at the Sloan School of Management at the Massachusetts Institute of Technology and the Director of the Center for Energy and Environmental Policy Research at the Massachusetts Institute of Technology.