In a 2-1 decision on Friday, the Tenth US Circuit Court of Appeals ruled that the EPA had the authority to reject the state’s pollution-control plan to limits the plant’s S02 emissions and impose a much stricter strategy.

OG&E and Oklahoma Attorney General Scott Pruitt argued that the EPA acted outside its authority but the federal agency contended that because the plans did not meet federal standards it was authorized to impose a more stringent plan.

"We conclude that the EPA has authority to review the state's plan and that it lawfully exercised that authority in rejecting it and promulgating its own," the judges stated in their 51-page decision.

The EPA said OG&E must either install scrubbers at the four coal units or convert the units to natural gas within five years.

OG&E said the EPA’s plan would cost more than $1 billion to implement by 2018.

In a statement Pruitt said OG&E disagreed and was disappointed with the court's decision.

“We will continue to fight to preserve the ability of Oklahoma stakeholders to create an Oklahoma solution and to protect Oklahoma consumers from excessive and unnecessary utility costs,” Pruitt said.

“We are reviewing the decision and considering our options.”

The Sierra Club environmental group said the coal plants in Fort Gibson and Red Rock were two of the state’s largest sources of sulfur dioxide pollution.

“OG&E sends hundreds of millions of dollars out of state each year to import coal and the pollution that comes with it,” Sierra Club Oklahoma chapter director David Ocamb said.

“For a state with abundant homegrown natural resources this makes no sense.

“The court upheld the law and acted in Oklahoma’s best interests when OG&E wouldn’t.”