As the sands shift on federal climate change policy, California’s cap-and-trade program survives to fight another day. Yesterday, a California Court of Appeal upheld the program because it does not impose a tax subject to the two-thirds supermajority vote requirement under Proposition 13. The Court also affirmed the California Air Resources Board’s (CARB) authority to auction GHG emissions allowances. For the ins and outs of the decision and prior coverage of the case, pop on over to Renewable + Law for a great post by my colleagues, Allison Smith and Parissa Florez.
Now, stating the obvious here: a lot is riding on this case. The cap-and-trade program has generated billions of dollars in fees and the program plays a crucial role in California’s goal to cut GHG emissions. Those fees don’t get paid with monopoly money, but instead hit the bottom line of companies across many different industries. Of course, some consider the fees to be a small price to pay to prevent flooding, the sixth mass extinction, and in their view, the end of the world. On a level that hits closer to home for many readers of this blog, the challenge to the cap-and-trade program has added to the uncertainty of how to address GHG emissions for development projects subject to CEQA. As previously discussed by my colleague, Tom Henry, reliance on the cap-and-trade program appears to be one of the few approaches to a legally defensible CEQA GHG analysis.Continue Reading CARB Wins Again on Cap-and-Trade, But Is It Really in Any Danger of Losing?