A US court tossed out one of President Donald Trump’s signature efforts to roll back environmental regulations just one day before he leaves office, scrapping a rule meant to prop up the ailing coal industry.

The Affordable Clean Energy rule covering emissions from the power industry was introduced in 2019 to replace stricter curbs adopted under the administration of Barack Obama.

On Tuesday, federal judges vacated the rule and sent it back to the US Environmental Protection Agency for reconsideration, giving the incoming Biden administration a clean slate to reinvent the policy.

Leadership at EPA will change after Wednesday’s inauguration of president-elect Joe Biden, who has promised to put the US on course to eliminate carbon emissions from the power sector in less than 15 years.

Mr Trump, by contrast, had campaigned in 2016 on a pledge to revive US coal mining, speaking at rallies before a backdrop of helmeted supporters where signs read “Trump Digs Coal”.

The ACE rule was designed to ease constraints on the power industry while still complying with legal requirements under the federal Clean Air Act. It pushed individual coal-fired power plants to become more efficient, with the potential consequence of having them run longer and more often, in turn bolstering demand for coal.

Whereas the Obama-era Clean Power Plan had addressed the electricity system as a whole, Mr Trump’s EPA, under administrator Andrew Wheeler, argued it could only impose curbs on individual plants under legal obligations in the federal Clean Air Act.

The US Court of Appeals for the District of Columbia Circuit said that the EPA’s self-imposed limitations were based on a “tortured” reading of the law that misread well-understood conventions of grammar.

“The EPA’s position depends critically on words that are not there,” the court wrote.

The ruling came in litigation that pitted environmental groups and more liberal states against some energy companies and other states, including those with large coal mining operations.

Michelle Bloodworth, president of America’s Power, which represents coal producers and companies with coal-fired power plants, said her group was disappointed with the decision.

“We had intervened in the case to help defend the rule because we feel that the ACE rule follows the plain language of the Clean Air Act, and the rule takes a sensible approach to regulating carbon dioxide emissions from the nation’s coal fleet, whose emissions have declined significantly even without carbon regulations,” she said.

Environmentalists cheered the news. “The court’s decision to vacate former coal lobbyist Andrew Wheeler’s Dirty Power Plan is the apt bookend to the Trump Administration’s EPA, which was defined by a general subservience to the fossil fuel industry and dozens of legal defeats brought by public health and environmental organisations,” the Sierra Club said.

Hana Vizcarra, staff attorney at Harvard University’s Environmental and Energy Law Program, said the court’s opinion gave the Biden administration a clean slate to work on greenhouse gas emissions from existing power plants and flexibility in doing so.

“Without ACE in place, the Biden administration can immediately start the work of designing a new approach,” she said.

The Obama administration’s Clean Power Plan never took effect, after the Supreme Court ordered it to be suspended in 2016. It had required electric power sector carbon emissions to decline 32 per cent from 2005 levels by 2030.

In fact, electric power sector emissions have already fallen more than a third from 2005 emissions to 1.6bn tonnes in 2019, according to the US Energy Information Administration. Utilities and power producers have permanently shut down dozens of coal-fired power plants, turning to cleaner natural gas, wind and solar power for most new capacity.