A federal appeals court has sided with the State of Kansas and overturned an EPA regulation on power plants.

In a 2-1 decision Tuesday, a panel of the U.S. Court of Appeals for the District of Columbia said the Environmental Protection Agency’s cross-state air pollution rule exceeded the agency’s statutory authority.

Last year, Kansas was the first state to sue the EPA to block the proposed new regulations.

The court Tuesday faulted the EPA for imposing “massive emissions reduction requirements” on upwind states without regard to restrictions imposed by law and blocked implementation of the proposed new regulation unless EPA reconsiders and revises it.

“This decision will help hold down the cost of electricity for Kansans,” Kansas Attorney General Derek Schmidt said. “The Court has made it clear that the federal bureaucracy cannot disregard the law and ignore the states in developing new regulations. This is a victory for Kansas ratepayers.”

The Petition for Review that Schmidt filed last year asked the court to reject the new EPA regulations that would have required Kansas utilities to invest hundreds of millions of dollars in new emissions control equipment before January 1, 2012 – a timeline the state’s utilities said would be impossible.

The rule was published by EPA in the summer of 2011. EPA claimed the rule was intended to prevent air pollution from states like Kansas from contributing to air-quality problems in downwind states in the northeast. The Court’s ruling requires the EPA to engage in new rulemaking if it wishes to revisit the subject.