California Groups Seek Overhaul of State Carbon Market

California should abandon a cap-and- trade program for greenhouse gases and rewrite regulations for cutting the emissions that scientists link to climate change, an environmental-justice group said.

The program, in which power plants, refineries and factories buy and sell the right to emit carbon dioxide, will let companies pay to “continue polluting in low-income communities,” Alegria De La Cruz, legal director at the Center on Race, Poverty & the Environment, said today in a telephone interview from San Francisco.

De La Cruz’s group and advocacy organizations are suing the California Air Resources Board, which approved the cap-and-trade regulation in December, to force reconsideration of greenhouse- gas regulations. The board’s climate-change rules don’t satisfy a requirement in the state’s 2006 Global Warming Solutions Act to clean up poor, polluted neighborhoods, she said.

The San Francisco County Superior Court sided with the groups in a preliminary ruling last month. Judge Ernest Goldsmith said the air-resources board “abused its discretion” when it approved a December 2008 plan that laid the groundwork for the cap-and-trade program and other greenhouse-gas regulations. The board prematurely decided to start work on a cap-and-trade program without offering alternative proposals and provided “no evidence to support its chosen approach,” Goldsmith said in the Jan. 21 decision.

The parties will get a chance to file objections to Goldsmith’s decision next week, De La Cruz said. Stanley Young, a spokesman for the air resources board, said in an e-mail the agency is “still reviewing this tentative decision” and plans to respond to the ruling.

2020 Deadline

California’s cap-and-trade regulation seeks a 15 percent cut in greenhouse gases such as carbon dioxide from power plants, refineries, factories, cars and trucks by 2020. The program is scheduled to start next year.

The program is similar to the cap-and-trade plan President Barack Obama failed to get through Congress last year. The air resources board will create carbon dioxide allowances, which can be bought and sold. Each allowance represents one metric ton of carbon dioxide.

The number of allowances would be reduced over time to enforce the pollution cuts. Companies in the cap-and-trade program may use offsets, which are pollution cuts from unregulated sources such as farms and forests, to meet some of their obligations under the carbon-cutting regulation.

To contact the reporter on this story: Simon Lomax in Washington at slomax@bloomberg.net.

To contact the editor responsible for this story: Larry Liebert at LLiebert@bloomberg.net.

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