The recent rescission of the US Environmental Protection Agency (EPA) Greenhouse Gas Endangerment Finding and Motor Vehicle Greenhouse Gas Emission Standards Under the Clean Air Act marks one of the largest deregulation efforts in a generation. Among the 571,672 comments the EPA received on this issue last September, my colleagues at AIER Drs. Julia Cartwight, Paul Mueller, Ryan Yonk, and I joined the State Financial Officers Foundation (SFOF) and thirteen state financial officers in submitting a public comment in support of the rescission.
The Endangerment Finding was rescinded in February 2026 by President Trump and EPA Administrator Lee Zeldin. This action stands to help make life more affordable, reduce regulatory uncertainty, and rein in an expansive administrative state.
What Was the EPA’s Endangerment Finding?
In 2007, the Supreme Court case Massachusetts v. EPA (2007) ruled that the EPA was allowed to regulate greenhouse gases because they qualify as air pollutants under the Clean Air Act. From this ruling and a failed attempt at getting a climate bill through Congress, President Obama leaned on executive rulemaking.
From his exercise of executive authority came the EPA’s Endangerment Finding. The finding declared six greenhouse gases broadly endangered public health and welfare, thus requiring regulation. The Endangerment Finding was the basis for vehicle emission regulation, but soon spread beyond that, resulting in costly burdens for Americans.
One hurdle, however, was that the Clean Air Act was designed to regulate industry, not the specific gases themselves. As Judge Glock of Manhattan Institute notes, “The act required federal permits for any source that emitted more than 100 tons per year of an air pollutant. By this measure, some families would need permits.”
Despite some Supreme Court rulings limiting the EPA, the Endangerment Finding led to regulations that made life less affordable for the average American. Regulations under the Biden Administration EPA alone cost an estimated $1 trillion. Additionally, as we discuss in our comment, these regulations encourage a “ratchet effect,” where the government (in this case, the executive branch and the EPA in particular) expands in size and/or scope of authority due to perceived crises and rarely fully recedes. This, ultimately, decreases accountability.
In the end, the Endangerment Finding enabled the creation of stringent rules but failed to clearly demonstrate the social benefits of individual policies proportional to their economic costs. The regulations stemming from the finding made life less affordable, but the benefits of said regulations were much more difficult to prove.
The Benefits of Rescission
Our comment focused on three key areas: the economic benefits of rescission, the dangers of an expansive administrative state, and the effects of the potential rescission on federalism.
The economic benefits of the rescission stem from the rollback of the burdensome regulations discussed in the previous section. Repealing these regulations could help lower costs of energy production for both producers and consumers. Regulatory reform would also reduce the policy uncertainty from vague statutes, lowering the costs for both producers and consumers.
Additionally, the rescission helps return rulemaking power to the legislative branch. Returning rulemaking powers to the elected legislative branch can improve transparency and accountability.
Furthermore, the rescission improves the balance between the federal and state governments. While Congress has primacy in climate policy, states have greater autonomy to apply local knowledge to environmental and energy challenges. This is especially important given the Supreme Court rulings of Loper Bright Enterprises v. Raimondo (2024), which compels courts to exercise independent judicial judgment interpreting ambiguous statutes rather than defaulting to agency readings, and West Virginia v. EPA (2022), which ruled that agencies must rely on Congress to grant it authority to regulate on issues of “economic and political significance” and allow states to set the enforceable rules governing existing energy sources.
What Comes Next?
The rescission can help shift environmental and energy policy away from command-and-control regulations and toward institutional frameworks that rely on price signals, property rights, and competition. Markets function as a discovery process where entrepreneurs can test alternative technologies, production methods, and energy sources under conditions of profit and loss. When prices reflect relative scarcity, producers are driven to economize on fuel, improve efficiency, and innovate cleaner production techniques to reduce costs.
Additionally, by returning rulemaking to Congress and discretion to the states, the federal government can focus on sustaining “competitive, ‘market preserving federalism’” while states are free to innovate without inhibiting free entry and exit between states. Successful institutional arrangements will scale as failed approaches exit as Americans vote with their dollars and their feet. Environmental stewardship emerges through clearly defined property rights, liability rules, and localized governance mechanisms that address identifiable harms.
By allowing market processes to work, people, not government, can drive lower cost abatement strategies while preserving energy reliability and consumer choice.
Read the full public comment here.
