A federal court of appeals has ruled that the Environmental Protection Agency can regulate carbon emissions from vehicles and power plants.

A coalition of energy companies, manufacturers and individual states—including Kentucky and Indiana—challenged the rules in court. They argued that a core provision—the finding that greenhouse gases, like carbon dioxide are pollutants and pose a danger to human health—wasn’t based on science. And without that finding, they argued the federal government couldn’t set standards for vehicle and power plant carbon dioxide emissions.

But the three-judge panel disagreed, and ruled that the EPA was acting within the bounds of the Clean Air Act.

Howard Fox is an attorney for environmental group Earthjustice.

“This ruling is very important because EPA has been moving forward with safeguards to limit carbon pollution from a lot of different sources and that has good effects for the environment and for public health and for the economy as well,” he said.

Tim Profeta is the director of Duke University’s Nicholas Institute for Environmental Policy Solutions. He says this ruling could potentially be the final word on whether the EPA can regulate greenhouse gas emissions.

“But it only opens the chapter on how should EPA regulate greenhouse gases under the Clean Air Act,” he said. “And so, I think minds will now turn to how, or what is the most intelligent and effective way for the agency to tackle greenhouse gases under the Act.”

In a statement, Kentucky Attorney General Jack Conway says he is still reviewing the decision and will discuss potential legal steps with the other states that opposed the EPA regulations.