U.S. Supreme Court justices gave no indication of how they would rule during Dec. 10 arguments in a case that could have major impacts on environmental requirements for the energy industry, one analyst told Hart Energy after reviewing a hearing transcript.

Instead, justices peppered each side with questions, testing each side’s theory, said Tom Sharp, director of permitting intelligence for Arbo, a firm tracking the relationship between government and the energy industry.

A ruling is not expected until spring of next year.

The decision could affect the rules that govern environmental regulations that the entire energy sector has to follow. The case centers on a fight over a Utah railway.

To improve the crude egress out of the Uinta Basin in Utah, a coalition of producers and local governments planned to build a railway. (The waxy crude from the basin can’t be shipped via pipeline.)

The government of Eagle County, Colorado, and a consortium filed suit, saying the project would pollute the environment. Eventually, the case appeared in the U.S. Court of Appeals, D.C. Circuit. The panel ruled that the train’s environmental assessment should consider the greenhouse-gas emissions that will be released by the eventual usage of the product it’s carrying, as well as the CO2 released by the train’s operation.

“The Justices probed two competing approaches. Industry advocates pushed for a bright-line test based on ‘proximate cause,’ which is a concept borrowed from tort law that limits liability to reasonably direct harms, just as a negligent driver wouldn't be liable if a delayed doctor's patient died across town,” Sharp told Hart Energy via email.

“Along these lines, the industry counsel’s standard would be that agencies shouldn't be faulted for not evaluating impacts that are both remote in time and place, when another agency has regulatory authority.”

Attorneys for the government countered that strengthening federal agencies’ discretion “to determine 'reasonable' scope of the environment review could reduce litigation without creating regulatory gaps due to the extraordinary breadth of varied actions the government needs to analyze," Sharp said.

The follow-on effects of adding greenhouse gases to the atmosphere was a major issue for the LNG industry in 2024. The same D.C. federal appeals court vacated two federal permits for developing plants in Texas, saying that more consideration needed to be given to the total CO2 the projects would ​​​​​produce overall.

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