California Auctions First Carbon Credits; Chamber of Commerce Sues

California's climate law reached a milestone on Nov. 14 when the state auctioned its first carbon credits in the 'Cap & Trade' provision of the bill. But that didn't stop the CA Chamber of Commerce from filing suit against this provision of the law.

2 minute read

November 15, 2012, 8:00 AM PST

By Irvin Dawid


Undeterred by the California Chamber of Commerce's lawsuit that called the auction "an unconstitutional tax" on businesses, the California Air Resources Board (ARB) proceeded with the nation's first, state-administered sale of carbon credits. The Chamber believes that ARB can only impose regulatory fees on businesses.

Dale Kasler writes that "(c)ap and trade is supposed to be a business-friendly, market-driven approach to curbing carbon emissions. While the state imposes an overall cap on the total amount of carbon emissions, polluters can comply with the law by cleaning their smokestacks or buying emissions credits at market prices."

"The state expects to raise between $500 million and $1 billion selling carbon emission credits Wednesday (Nov. 14) and at a second auction next February. But a lawsuit looming over the process "could dampen the enthusiasm" for the auction, said Jon Costantino, executive director of the Association of Carbon Market Participants."

Considering that only 10% of the total credits will be auctioned on Nov. 14 and the remainder "given away for free", the lawsuit is presumably aimed to stop the February auction. The CalChamber did not ask for an injunction to stop the current auction.

Pat Brennan of The Orange County Register presents both sides on the economic effects on business of the carbon auction.

The CalChamber maintains "that element of the program would prove costly and "will hurt our struggle to maintain jobs", according to Loren Kaye, president of a commerce and education "think tank" affiliated with the chamber.

"Supporters contend that predictions of harmful economic effects are overblown."

"There continues to be cost estimates that are just wildly inflated," said Timothy O'Connor, director of the California Climate Initiative for the Environmental Defense Fund. "So it is creating this skepticism about whether this is the right approach for California. These estimates, time and time again, are consistently undercounting benefits and overcounting costs."

The nation's first carbon auction program, the east coast's Regional Greenhouse Gas Initiative applies only to electric utilities for nine states. The ARB program is far more comprehensive and will eventually capture 85% of the state's greenhouse gas emissions.

Thanks to Sarah Matsumoto

Wednesday, November 14, 2012 in The Sacramento Bee - Business

Large blank mall building with only two cars in large parking lot.

Pennsylvania Mall Conversion Bill Passes House

If passed, the bill would promote the adaptive reuse of defunct commercial buildings.

April 18, 2024 - Central Penn Business Journal

Aerial view of Oakland, California with bay in background

California Exodus: Population Drops Below 39 Million

Never mind the 40 million that demographers predicted the Golden State would reach by 2018. The state's population dipped below 39 million to 38.965 million last July, according to Census data released in March, the lowest since 2015.

April 11, 2024 - Los Angeles Times

A view straight down LaSalle Street, lined by high-rise buildings with an El line running horizontally over the street.

Chicago to Turn High-Rise Offices into Housing

Four commercial buildings in the Chicago Loop have been approved for redevelopment into housing in a bid to revitalize the city’s downtown post-pandemic.

April 10, 2024 - Chicago Construction News

Purple jacaranda trees in bloom in Los Angeles with tall white Art Deco buildings in background.

LA County Releases Draft Community Forest Management Plan

LA County's Chief Sustainability Office just released the discussion draft of Room to Grow, the first Community Forest Management Plan for the county.

41 minutes ago - Los Angeles County Chief Sustainability Office

Aerial view of downtown Seattle, Washington at dusk.

Seattle Downtown Plan Expands Permitted Uses

The Downtown Activation Plan shifts from Euclidean to form-based zoning to encourage more commercial development.

2 hours ago - Governing

Large water pipe with brown water pouring out into dirt ditch.

Southern Water Infrastructure at Risk From Climate Impacts

A water main breaks somewhere in the United States every two minutes, according to an estimate from the American Society of Civil Engineers.

4 hours ago - The Conversation

News from HUD User

HUD's Office of Policy Development and Research

Call for Speakers

Mpact Transit + Community

New Updates on PD&R Edge

HUD's Office of Policy Development and Research

Urban Design for Planners 1: Software Tools

This six-course series explores essential urban design concepts using open source software and equips planners with the tools they need to participate fully in the urban design process.

Planning for Universal Design

Learn the tools for implementing Universal Design in planning regulations.