Supreme Court decisions increase risk for businesses in the U.S. energy sector

In June and July, the U.S. Supreme Court handed down several landmark decisions that shift the regulatory landscape for businesses in the energy sector. In a decision released on June 28, 2024, the Court overturned the long-standing Chevron doctrine and, with it, abolished the principle of judicial deference to an administrative agency’s interpretation of ambiguous statutes. Historically, Chevron deference granted agencies like the Environmental Protection Agency (EPA), the Federal Energy Regulatory Commission (FERC), the Securities and Exchange Commission (SEC), and the Commodity Futures Trading Commission latitude in interpreting regulations. The new Loper Bright decision instead requires courts to conduct judicial review of agency actions, applying their own judgment without deferring to the agencies. This marks a significant shift in regulatory interpretation that amplifies risks for businesses in the U.S. energy sector.

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Contacts

Sara Hayes - Partner, ERM
GuyLaine Charles - Founder, Charles Law PLLC