The U.S. Environmental Protection Agency wants to reconsider North Carolina's request to force neighboring states to tighten pollutant emission standards.
It's a signal that President Barack Obama's administration may focus on demanding cleaner utilities.
North Carolina first sought aid from the EPA in 2004, complaining that older, coal-fired power plants in neighboring states were contributing to North Carolina's clean air problems.
The EPA denied that request, but Attorney General Roy Cooper has continued to fight the decision.
Judges wrote in a ruling released late Thursday that the EPA wants to reconsider the denial, with the agency acknowledging that court rulings have eliminated its legal justification.
The EPA did not return calls seeking comment.