The U.S. Supreme Court on June 27 blocked an Environmental Protection Agency (EPA) regulation aimed at reducing ozone emissions that may worsen air pollution in neighboring states, handing a victory to three Republican-led states and the steel and fossil-fuel industries that had challenged the rule.

The 5-4 decision granted requests by Ohio, Indiana and West Virginia, as well as U.S. Steel Corp., pipeline operator Kinder Morgan and industry groups, to halt enforcement of the EPA's "Good Neighbor" plan restricting ozone pollution from upwind states, while they contest the rule's legality in a lower court.

The EPA issued the rule in March 2023 intending to target gases that form ozone, a key component of smog, from power plants and other industrial sources in 23 upwind states whose own plans did not satisfy the "Good Neighbor" provision of the Clean Air Act anti-pollution law, requiring steps to reduce pollution that drifts into states downwind.

The agency said the rule would result in cleaner air for millions of people, saving thousands of lives.

The challenge followed a major 2022 ruling powered by the Supreme Court's conservative majority imposing limits on the EPA's authority under the Clean Air Act to reduce coal- and gas-fired power plant carbon emissions, undermining President Joe Biden's plans to tackle climate change. The court last year also hobbled the EPA's power to protect wetlands and fight water pollution.

The challenge to the "Good Neighbor" rule was brought by Ohio, Indiana and West Virginia - all targeted by the rule - as well as pipeline operators, U.S. Steel, regional electricity generators and energy trade associations. In their suit in the U.S. Court of Appeals for the District of Columbia Circuit, they argued that the EPA violated a federal law aimed at ensuring agency actions are reasonable.

The D.C. Circuit refused to block the rule pending its review, prompting the challengers to ask the Supreme Court, which has a 6-3 conservative majority, to intervene.

Opponents have said the rule would impose unreasonable costs and destabilize power grids. The Justice Department, defending the EPA, urged the Supreme Court to consider the serious harms to public health that would result from blocking it.

The rule implemented a federal program that applied to 23 states, but separate challenges in lower courts have already paused enforcement in 12 of them, including West Virginia.

During arguments in the case on Feb. 21, some of the conservative justices focused on the EPA's lack of explanation for how the plan can work when it now regulates just 11 states instead of 23 as intended. Liberal justices expressed concern about whether the case warranted emergency intervention by the Supreme Court at this time.

Some of the industry requests of the Supreme Court were specific. Kinder Morgan asked the justices to block the regulation as it applies to natural gas pipeline engines. U.S. Steel sought to prevent its enforcement against iron and steel mill reheating furnaces and boilers.

On Jan. 16, the EPA issued a proposed rule to enforce the "Good Neighbor" plan in five more states: Arizona, Iowa, Kansas, New Mexico and Tennessee.

The Supreme Court is deciding multiple cases during its current term concerning challenges to the authority of various federal agencies. The justices on May 16 upheld the Consumer Financial Protection Bureau's funding mechanism in a challenge brought by the payday loan industry.

The court is expected in the coming days to rule on other cases involving the Securities and Exchange Commission and the National Marine Fisheries Service.

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