The agency next will schedule a public comment period and public hearing. At stake is California's 2005 petition to gain an exemption from the federal Clean Air Act. The state wants automakers to reduce the greenhouse gas emissions from cars and light trucks by 25 percent and from sport utility vehicles by 18 percent starting in 2009. Eleven other states have since adopted California's standard. The EPA had argued that the agency could not regulate greenhouse gas emissions from vehicles because to do so would require an increase in fuel economy standards, something only the U.S. Department of Transportation can set. But in its 5-4 decision Monday, the Supreme Court ruled that the EPA had such authority. California has special authority under the federal Clean Air Act to set its own vehicle pollution standards because it began regulating air pollution before the federal government did in the 1970s.

Monday's court ruling also prompted movement Tuesday in a separate lawsuit brought by the auto industry to prevent California from moving forward with its own regulations. The California Air Resources Board, along with several environmental groups, officially notified U.S. District Judge Anthony Ishii of the Supreme Court's decision. In January, he placed the lawsuit on hold pending a decision by the court. It's unclear what the next step will be in the case, which is being heard in federal court in Fresno. But both sides said the Supreme Court's decision favors their argument. "The case will affect all of the pending litigation that California has with both the auto companies and Midwestern energy companies," California Attorney General Jerry Brown said in an interview Monday with The Associated Press. Raymond Ludwiszewski, an attorney representing the Association of International Automobile Manufacturers, interpreted the ruling by the Supreme Court as a directive that greenhouse gas regulations should be crafted at the federal level. "I think the Supreme Court ruling makes it clear that the court viewed global warming as an issue that should be dealt with nationally and not at the state level," Ludwiszewski said Tuesday.