CALIFORNIA:

Judge blocks state's global warming law, putting 2012 start date in doubt

SAN FRANCISCO -- A California Superior Court judge has suspended implementation of the state's climate change law on the grounds that a state agency failed to conduct a proper environmental analysis or consider alternatives to a cap-and-trade system for carbon.

The ruling from San Francisco County Superior Court Judge Ernest Goldsmith amounts to a serious setback for the state and officials at the California Air Resources Board, which is in the process of putting the final touches on its scoping plan to enact the law starting in less than a year.

Among the affected rulemakings under the scoping plan are the state's low-carbon fuel standard, the cap-and-trade market and a 33 percent renewable portfolio standard for electricity by 2020. Taken together, these policies and others are meant to reduce greenhouse gases in California to 1990 levels by 2020, starting Jan. 1, 2012.

In a 36-page order, Goldsmith said ARB had abused its authority under the global warming law, A.B. 32, by failing to consider alternatives in enough detail. A carbon tax, for instance, was given short shrift, Goldsmith said.

"The brief, fifteen-line reference to the carbon fee alternative consists almost entirely of bare conclusions justifying the cap-and-trade decision," the judge wrote. "Informative analysis is absent."

He went on: "ARB fails to describe what a carbon fee program consists of, how fees or taxes are established, criteria for setting the amounts, what the California, United States and worldwide experience has been, how it is administered and by whom, what are the alternatives for use of the revenue, and what sectors of the economy it should be considered for, or not, or why."

The suit was brought against the air board by a coalition of environmental justice advocates, many of them based in Southern California. The premise of their opposition to the A.B. 32 scoping plan is that the agency failed to comply with the California Environmental Quality Act, which is the state's equivalent of the National Environmental Policy Act.

An ARB appeal may delay start

Jon Costantino, one of the architects of the analysis who has since left the air board, described the ruling as a potentially significant hurdle that has ARB scrambling to react, to stick to a tight timeline for going live with greenhouse gas restrictions by year's end.

"There's not a whole lot of wiggle room in the calendar," said Costantino, now a senior adviser on climate change at Sacramento law firm Manatt, Phelps & Phillips LLP. "As of right now and today, there's uncertainty as to what this all means. The dust has to settle."

It is unclear, for one, if the air board or California Attorney General Kamala Harris (D) will attempt to appeal the ruling. Costantino said if the agency decides to pursue appeal, that means the Jan. 1, 2012, start date would almost certainly get pushed back.

Another option is for state attorneys to seek a stay on the ruling that allows ARB to implement its policies as planned until a final verdict is rendered. Or the air board could conduct the necessary analyses as quickly as possible, but even that option comes with uncertainties attached.

"What happens when ARB redoes the analysis?" Costantino asked. "Does it just go back to the judge? Does it have to go back for public comment?"

ARB is confident

The attorney general's office at press time yesterday was referring calls to the air board. Back in February, Harris rejected a tentative ruling from Goldsmith that mirrors the official decision, saying the judge had issued an "ambiguous" opinion that could unnecessarily derail A.B. 32 (ClimateWire, Feb. 9).

Reached yesterday, ARB spokesman Stanley Young said the agency disagrees with the decision and intends to appeal. But before a time-consuming appeal takes place, the air board plans to seek clarification on the scope of the order so the A.B. 32 process might continue on schedule.

"We believe plaintiffs did not intend to put on hold efforts to improve energy efficiency, establish clean car standards and develop low carbon fuel regulations," Young wrote in an email. "A broadly worded writ puts at risk a range of efforts to move California to a clean energy economy and improve the environment and public health."

Young also insisted the cap-and-trade system and alternatives had been subject to "a robust and comprehensive examination," including a 500-page environmental analysis that "fully addresses the concerns the court raises."

Click here to see Goldsmith's ruling.