The US Supreme Court has sided with conservative states and fossil-fuel companies, agreeing that the federal Environmental Protection Agency (EPA) did not have the authority to impose sweeping measures to reduce greenhouse gas emissions.
Thursday's 6-3 ruling represents a major setback to President Joe Biden's climate plans, reports the BBC.
The case against the EPA was brought by West Virginia on behalf of 18 other mostly Republican-led states and some of the nation's largest coal companies.
They argued that the agency did not have the authority to limit emissions across whole states.
These 19 states were worried their power sectors would be forced to move away from using coal, at a severe economic cost.
The court has not completely prevented the EPA from making these regulations in the future, but said that Congress would have to clearly say it authorises this power.
These 19 states made up 44 per cent of the US emissions in 2018, and since 2000 have only achieved a 7 per cent reduction in their emissions on average, the BBC reported.
In response to the "devastating" ruling, the President said: "While this decision risks damaging our nation's ability to keep our air clean and combat climate change, I will not relent in using my lawful authorities to protect public health and tackle the climate crisis."
Also slamming the decision, a UN spokesperson called it "a setback in our fight against climate change", but added that no single nation could derail the global effort.
But Attorney General Eric Schmitt for Missouri, one of the 19 states, called it a "big victory... that pushes back on the Biden EPA's job-killing regulations".