Trump Climate Rollback May Open ‘New Front’ of Lawsuits Against Power Companies

The Trump administration’s move to repeal the 2009 “endangerment finding” - the scientific determination that greenhouse gases threaten public health - could trigger a fresh wave of climate-related lawsuits against power plants and major emitters, legal experts say.

The Environmental Protection Agency is expected this week to formally rescind the finding, which has served as the legal backbone for federal greenhouse gas regulation under the Clean Air Act. EPA Administrator Lee Zeldin has described the repeal as the “largest act of deregulation in the history of the United States.”

But dismantling the regulatory framework may have unintended consequences. Legal scholars argue that removing the federal government’s oversight role could revive public nuisance lawsuits - a legal theory that allows states and municipalities to sue companies for activities that harm public health or safety.

In a landmark 2011 ruling, the U.S. Supreme Court held that the Clean Air Act and EPA regulations displaced such federal nuisance claims, effectively shielding power companies from similar lawsuits. If the EPA abandons regulation of greenhouse gases, that legal shield may erode.

“This has the potential to change the stakes of the game,” said University of Pennsylvania law professor Sarah Light, noting that without a comprehensive federal regulatory scheme, nuisance claims could proceed in court. Robert Percival, a University of Maryland law professor, warned the repeal may backfire, opening the door to expanded litigation.

Industry groups have expressed concern. The Edison Electric Institute cautioned that rescinding the finding could invite increased common-law claims, regardless of their ultimate success.

Public nuisance cases remain difficult to win, given challenges in proving direct causation between specific emissions and climate harms. Still, legal experts suggest the policy reversal could reshape the litigation landscape, potentially shifting climate battles from federal agencies to courtrooms across the country.

Litigation risk shifting to power companies is a real consequence of federal deregulation, and it affects utility, IPP and lender pricing of climate exposure even when public-nuisance claims struggle at the causation stage. Our sustainability-due-diligence teams help utility clients evaluate what these dynamics mean for TCFD-aligned transition and physical-risk disclosure.