A coalition of state attorneys general and municipal governments filed suit this week challenging the Environmental Protection Agency's repeal of a federal rule that set greenhouse gas emission limits on power plants, the Terre Haute Tribune-Star reported. The complaint targets the Trump administration's decision to scrap the standard, which had applied to existing coal-fired generators and new natural gas units, and asks a federal court to vacate the rescission and reinstate the 2024 limits pending judicial review.

The litigation opens the first major legal test of the EPA's early-2025 deregulatory push under Section 111 of the Clean Air Act, and sets up a multi-year court fight over whether the existing-source rule ever takes effect against the operators it covers.

What was the contested rule?

The rule, finalized in April 2024 under Section 111 of the Clean Air Act, established the first federal greenhouse gas limits on the existing coal-fired fleet and on new baseload natural gas plants. It gave operators a menu of compliance pathways: co-firing with lower-carbon fuels, installing carbon capture and sequestration, retiring the unit, or switching to a lower-emitting fuel.

Industry groups challenged the rule on legal grounds within weeks of publication, and the Trump EPA moved to rescind it shortly after taking office. EPA's stated rationale was that the legal foundation for the rule had eroded and that the agency had exceeded its statutory authority in setting emission guidelines for existing sources.

Who is on the complaint?

The plaintiffs include multiple state attorneys general and a group of cities, according to the Tribune-Star report. Democratic AG offices that have historically led Clean Air Act enforcement against the federal government are heading the case. The municipal plaintiffs are utilities that would face direct compliance obligations under any reinstated standard.

What is the legal theory?

The complaint alleges that the EPA's repeal exceeds its authority under the Clean Air Act and runs counter to the agency's own technical record. Plaintiffs are expected to argue:

• The agency cannot rescind emission guidelines under Section 111 without replacing them with an alternative standard
• The repeal fails the "reasoned decision-making" requirement of the Administrative Procedure Act
• The agency's interpretation conflicts with binding D.C. Circuit precedent on Section 111

The complaint asks the court to vacate the rescission and reinstate the 2024 standards. Plaintiffs are also expected to seek a preliminary injunction to keep the rule operative during litigation.

What is the procedural path?

The case will be assigned to a federal district court, and the EPA must respond under standard scheduling rules. Industry interveners — including operators of large coal fleets, independent power producers with gas projects in development, and trade associations — are likely to file motions to intervene in defense of the rescission.

A preliminary injunction ruling will be the next major milestone. A win for plaintiffs would put the 2024 standards back in force immediately. A loss would push the case toward merits briefing, with a decision window of 12-24 months.

Any merits ruling will almost certainly be appealed to the D.C. Circuit, which hears most Clean Air Act challenges regardless of where the case is filed. The eventual appellate decision will likely determine whether the existing-source rule survives the Trump administration.

What to watch

• The district court's preliminary injunction ruling
• Industry intervener filings, which will signal which generation segments have the most to lose
• Any parallel state-level programs, including California's cap-and-trade system, that operate independently of the federal rule
• Congressional action that could affect EPA's litigation budget or the underlying statute