CalChamber Sues to Invalidate CARB’s Cap and Trade Auction

Tuesday, November 13, 2012
Contact: Denise Davis

SACRAMENTO, CA — ​The California Chamber of Commerce today filed a lawsuit seeking to invalidate California’s “cap and trade” auction arguing that the California Air Resources Board (CARB) exceeded the authority granted to it under AB 32 in establishing the revenue raising program.

The complaint, filed in Sacramento Superior Court today, asserts that AB 32 does not authorize CARB to impose fees other than those needed to cover ordinary administrative costs of implementing a state emissions regulatory program. “What was not authorized by AB 32 is the Board’s decision to withhold for itself a percentage of the annual statewide greenhouse gas (GHG) emissions allowances and to auction them off to the highest bidders, thus raising from taxpayers up to $70 billion or more of revenue for the state to use,” according to the complaint.

The lawsuit does not challenge any of the provisions of AB 32 nor the merits of climate change science. The only issue addressed in the litigation is the portion of CARB’s regulatory program that seeks to permit the Board to allocate to itself GHG emissions allowances and to profit by selling them to GHG emitters. CalChamber, other members of the business community, members of the Legislature, the Legislative Analyst’s Office and CARB have all highlighted the fact that the auction is not needed to achieve the goals of AB 32. The business community has repeatedly underscored the fact that the auction will raise energy costs significantly in the state, harm the economy and impact California’s competitiveness, without providing any additional environmental benefits.

“AB 32 gives California the opportunity to be the leader in reducing carbon emissions,” said Allan Zaremberg, President and CEO of the California Chamber of Commerce. “Unless we adopt the most cost effective way of reducing carbon emissions, other states will not follow us. The current CARB proposal is the most costly way to implement AB 32 and it will hurt consumers, the job climate, and the ability of businesses to expand here.”

A copy of the legal documents can be found on the CalChamber website. The Memorandum of Points and Authorities in Support of Verified Petition for Writ of Mandate and Complaint for Declaratory Relief can be found here. The Petition for Writ of Mandate and Complaint for Declaratory Relief can be found here

A filed copy of the Memorandum of Points and Authorities in Support of Verified Petition for Writ of Mandate and Complaint for Declaratory Relief can be found here. A filed copy of the Petition for Writ of Mandate and Complaint for Declaratory Relief can be found here.

The California Chamber of Commerce (CalChamber) is the largest broad-based business advocate to government in California. Membership represents one-quarter of the private sector jobs in California and includes firms of all sizes and companies from every industry within the state. Leveraging our front-line knowledge of laws and regulations, we provide products and services to help businesses comply with both federal and state law. CalChamber, a not-for-profit organization with roots dating to 1890, promotes international trade and investment in order to stimulate California's economy and create jobs. Please visit our website at www.calchamber.com.

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