Today, the Court of Appeals of the State of California for the Third Appellate District affirmed in full a lower court ruling in the California Chamber of Commerce v. State Air Resources Board lawsuit in support of the Board’s carbon allowance auction program.
The California Chamber of Commerce lawsuit argued that auctioning of State-owned allowances is illegal because it is a fee or a tax that requires a two-thirds legislative majority under State law. In 2014, a lower court ruled against the Chamber, which subsequently appealed the ruling.
Today’s Appellate Court ruling affirms the lower court's decision to deny a petition by Cal Chamber to invalidate the ARB auction. In effect, the ARB allowance auction process can remain in place, providing much needed certainty to carbon trading markets.
If you have questions regarding the court decision and its impact on the California carbon market, please contact our US Carbon team at: 415.963.9138 or 914.323.0265.