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Second group sues to stop California's cap and trade carbon auction

Published: Tuesday, Apr. 16, 2013 - 12:25 pm
Last Modified: Thursday, Aug. 15, 2013 - 9:03 pm

A second group filed suit today challenging California's cap and trade carbon auction, calling it a giant tax that wasn't properly approved by the Legislature.

The lawsuit was filed by the Pacific Legal Foundation, a conservative organization based in Sacramento, on behalf of a group of businesses.

An affiliate of the California Chamber of Commerce filed a similar lawsuit last fall, as the carbon program was getting underway.

"The 'cap and trade' auction program is a new state tax that will generate billions of dollars of revenues for the state on the backs of California taxpayers. Because it was not passed by at least a two-thirds majority vote of the Legislature, it is unconstitutional. Case closed," said Pacific Legal staff attorney Ted Hadzi-Antich in a prepared statement.

It's estimated that cap and trade will cost California businesses at least $1 billion in the first year.

The program subjects several hundred big polluters to a yearly "cap" on the amount of carbon they can emit; the cap declines slightly each year. If a company exceeds the limit, it can scale back its pollution or buy additional emissions credits, either from the state or from other companies.

The state is giving away the vast majority of the credits for free, but a small percentage is being auctioned off every three months.

Officials with the California Air Resources Board, which runs the program, weren't immediately available for comment.

The program is the centerpiece of AB 32, the seven-year-old law aimed at addressing global warming.

Call The Bee's Dale Kasler, (916) 321-1066. Follow him on Twitter @dakasler.

Read more articles by Dale Kasler

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