The state can go ahead with its plans to cap carbon emissions by California's largest refiners, utilities and other industrial companies, under a ruling by a state appellate court on Friday.
The 1st District Court of Appeals in San Francisco overruled a lower court ruling in May that ordered the California Air Resources Board to halt all work on its cap and trade program. The cap and trade program was set to begin operating in January and ARB officials had been working to develop the program's enforcement rules, oversight procedures and reporting requirements for heavy polluters.
A key component of the state's landmark climate change law, the cap and trade program essentially places a limit on the amount of carbon emitted by the state's 500 largest polluters and creates allowances that can be bought and sold on an open market.
Companies that pollute less than their limits can sell their unused allowances to companies that pollute heavily, providing incentives for the companies to reduce emissions voluntarily.
In March, San Francisco Superior Court Judge Ernest Goldsmith ruled that the ARB failed to conduct an adequate review of alternative approaches to reducing greenhouse gasses. Goldsmith's ruling came after environmental and community groups in the Bay Area sued to overturn the program.
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