The NYT has an article on the status of California’s cap and trade systems, set to start Jan 1, 2012, here. The article discusses the recent court case against the initiative:
What is surprising is that the most serious legal challenge to the market so far has come from the left.
A group of environmental justice organizations banded together and successfully sued the state in March, saying the regulators at CARB had failed to consider alternatives to a carbon market adequately.
The state plans to appeal the ruling, and at this point, few expect that the case will amount to much more than a headache for the already overstretched state officials.
Still, the ruling by a state Superior Court judge worried many supporters.
“This case does not send a message other than that lawsuits can delay things,” said Judi Greenwald, vice president of innovative solutions at the Pew Center on Global Climate Change.
That message might resonate with power companies in neighboring states like Arizona and Nevada that send electricity across their borders into California and would thereby be subject to the regulations.
Peabody Energy, the world’s largest private-sector coal company, said California’s carbon market would “run afoul of the Commerce Clause of the United States Constitution,” as it would amount to a tax between states.
Although no legal challenge has yet been filed on these grounds, most believe it is only a matter of time.
California officials have insisted they are on solid legal ground if such a case goes to court.
The person with the most power over whether the carbon market gets established is Governor Jerry Brown, a Democrat, who has been quiet on the issue so far. CARB officials have said that if Mr. Brown wants to delay the start of the market for any reason, he will have the power to do so.