California’s stringent cap and trade rules were scheduled to go into effect on Jan. 1 2012 but a federal judge blocked it on Thursday.
In my view, California’s cap and trade plans are unworkable, easily gamed, would raise energy prices substantially while accomplishing little to reduce emissions, and would probably drive even more business out of the state. So blocking it is a good thing. We need to reduce emissions but cap-and-trade is not the way to do it.
The basis of the order was that California’s Cap and Trade Law violates the Commerce Clause of the U.S. Constitution. The Commerce Clause reserves regulation of interstate trade to the Federal government.
The plaintiffs in the case are reportedly crude oil and ethanol producers who claim that California’ s law discriminates against imports of other fuels into the state.
The ruling means that refiners and ethanol producers won’t have to buy credits when importing oil and ethanol into California, as the regulations would have required in certain cases.