From the New York Times...
In a defeat for environmental groups, the Supreme Court ruled this term that the Environmental Protection Agency may use cost-benefit calculations to decide whether to require power plants to make changes that could preserve aquatic organisms. The case mostly concerned the meaning of a phrase in the Clean Water Act that requires the power plants' cooling structures to "reflect the best technology available for minimizing adverse environmental impact." Judge Sotomayor had previously ruled that weighing the costs of the changes against the value of the organisms in dollars was not permitted by the law. Instead, the EPA could consider only what cost "may reasonably be borne" by the power plants. When her ruling was overturned by the Supreme Court, Justice John Paul Stevens, joined by Justices Ruth Bader Ginsburg and David H. Souter, dissented, saying that cost-benefit analysis was prohibited by the law and pernicious in practice.
A more detailed view from SCOTUS Blog
Environmental Law: Sotomayor’s most notable environmental-law opinion is Riverkeeper v. EPA, 475 F.3d 83 (2d Cir. 2007), a challenge to an EPA rule regulating cooling-water intake structures at power plants. To minimize the adverse impact on aquatic life (which could otherwise be trapped against the intake structure or, if small enough, sucked into the pipes themselves), the Clean Water Act requires the intake structures to use the “best technology available,” without specifying what factors the EPA should consider in determining what constitutes the “best technology available.” Sotomayor wrote and opinion holding that the EPA was not permitted to engage in a cost-benefit analysis to determine “best technology available”; instead, it could consider cost only to determine “what technology can be ‘reasonably borne’ by the industry” and whether the proposed technology was “cost-effective” - which, she concluded, requires the EPA in turn to determine whether the technology at issue is “a less expensive technology that achieves essentially the same results” as the best technology that the industry could reasonably bear. Thus, she explained, “assuming the EPA has determined that power plants governed by the Phase II Rule can reasonably bear the price of technology that saves between 100-105 fish, the EPA, given a choice between a technology that costs $100 to save 99-101 fish and one that costs $150 to save 100-103 fish . . . could appropriately choose the cheaper technology on cost-effectiveness grounds.” On this issue, Sotomayor remanded to the EPA, finding it “unclear” how the EPA had arrived at its conclusions and, in particular, whether the EPA had improperly weighed costs and benefits.
Sotomayor also held that the EPA could not consider restoration measures - such as restocking fish to compensate for fish killed by an intake system - when determining the best technology available for a particular power plant. Sotomayor wrote that “[r]estoration measures are not part of the location, design, construction, or capacity of cooling water intake structures, and a rule permitting compliance with the statute through restoration measures allows facilities to avoid adopting any cooling water intake structure technology at all, in contravention of the Act’s clear language as well as its technology-forcing principle.” Finally, Sotomayor also determined that, at a minimum, EPA’s determination that the CWA provision at issue applies to existing and new facilities was a reasonable interpretation of the statute.
The industry plaintiffs filed petitions for certiorari, which the Supreme Court granted in April 2008 to review the cost-benefit issue. By a vote of 6-3, the Court reversed. In an opinion by Justice Scalia, the majority deemed “[i]t . . . eminently reasonable to conclude that” the CWA’s silence with regard to determining the best technology available “is meant to convey nothing more than a refusal to tie the agency’s hands as to whether cost-benefit analysis should be used, and if so to what degree.” Justice Stevens wrote a dissenting opinion, which was joined by Justice Souter and Ginsburg. In their view, because “Congress granted the EPA authority to use cost-benefit analysis in some contexts but not others” and intended “to control, not delegate, when cost-benefit analysis should be used,” Congress’s silence on this issue did not constitute “an invitation for the Agency to decide for itself which factors should govern its regulatory approach.”
• Environment (Protection of fish at power plants): Sotomayor, writing for a three-judge panel, ruled that the Environmental Protection Agency may not engage in a cost-benefit analysis in implementing a rule that the "best technology available" must be used to limit the environmental impact of power plants on nearby aquatic life. The case involved power plants that draw water from lakes and rivers for cooling purposes, killing various fish and aquatic organisms in the process. Sotomayor ruled that the "best technology" regulation did not allow the EPA to weigh the cost of implementing the technology against the overall environmental benefit when issuing its rules. The Supreme Court reversed Sotomayor's ruling in a 6-3 decision, saying that Sotomayor's interpretation of the "best technology" rule was too narrow. Justices Stevens, Souter, and Ginsburg dissented, siding with Sotomayor's position. Riverkeeper, Inc. vs. EPA, 475 F.3d 83 (2007)