The historic Waxman-Markey climate change bill passed by the House last Friday includes a provision that would strip the Environmental Protection Agency’s authority to regulate greenhouse gases under the Clean Air Act.

The bill has received a lot of attention, but this issue (found in Title III, Subtitle C) has flown under the radar. In an apparent attempt to avoid conflict with the cap-and-trade program lawmakers hope to put in place, the bill would not allow EPA to set and enforce greenhouse gas emissions limits in the way it does for other pollutants like smog and soot.

It’s only been about two years since EPA began considering Clean Air Act regulations. In April 2007, the Supreme Court ruled that climate-altering greenhouse gases were eligible for regulation under the Act – a position the Bush administration had denied.

Both cap-and-trade and Clean Air Act regulations would have the potential to be quite powerful, though in different ways. So, it makes sense to avoid any duplication of efforts by imposing one and foreclosing the other. Still, I’m surprised the provision has not attracted more attention considering that it effectively overturns a landmark Supreme Court decision.

Some environmental groups who oppose the bill (on the grounds it was not strict enough) are unhappy that EPA’s authority has been diminished. Friends of the Earth has a summary of its concerns here. Most of the major environmental advocacy groups support cap-and-trade and have not publicly raised concerns about the removal of EPA’s Clean Air Act authority.

Meanwhile, with a tough Senate battle ahead, this bill is far from becoming law. EPA should continue to move forward with Clean Air Act regulations. EPA took its first big step down this path in April when it proposed a finding saying that greenhouse gases are indeed a threat to public health and welfare.

The threat of those regulations gives advocates of cap-and-trade legislation an additional tool with which to leverage the debate. They are betting that industry lobbyists and some Republicans will throw their support behind the cap-and-trade bill, viewing it as less onerous than EPA regulations.

In related news, EPA has officially granted the state of California permission to set limits on greenhouse gas emissions from vehicles. The Bush administration had denied the request, even though the state appeared to be on solid legal footing.

The decision won’t have much practical impact. In May, President Obama announced federal standards that largely mirror the limits California was pursuing. This pleased both environmentalists, who wanted emissions reductions, and industry officials, who prefer a national standard over a state standard. Today’s Washington Post has more.