The Regional Greenhouse Gas Initiative (RGGI)
Power generation industry has expressed concerns that the collective effort of a group of Eastern states to combat global warming violates the Constitution’s Compact Clause and Commerce Clause, and is preempted by the President’s power over foreign policy
Status: No lawsuit has been filed; however, an industry challenge to block implementation of RGGI is expected
Discussion & Analysis: In the absence of federal action on climate change, a group of Northeastern states began to fashion a collective regional response in 2003. Today, this effort is known as the Regional Greenhouse Gas Initiative (RGGI) and represents an unprecedented joint approach by Northeastern and Mid-Atlantic states to combat global warming. RGGI’s goal is to reduce carbon dioxide emissions from power plants in participating states through a mandatory “cap-and-trade” program. Ten states (CT, DE, MA, MD, ME, NH, NJ, NY, RI, and VT) have signed a memorandum of understanding to become participants in the process, while several other U.S. jurisdictions (DC and PA) and Canadian provinces are observing. Each RGGI participant state must ultimately enact agreed-on rules, by way of state legislation or regulation, to implement the program.
The initial RGGI compliance period is scheduled to begin on January 1, 2009. Failure of any covered power plant to comply with program requirements will subject the plant to enforcement by state environmental authorities. If successful, RGGI will stabilize emissions from the power sector at roughly current levels from 2009 through the beginning of 2015. A further 10% reduction is anticipated by 2019. The RGGI participant states have discussed extending program coverage in the future to include other sources of greenhouse gas emissions, and to include greenhouse gases other than carbon dioxide.
Power sector advocates commenting on the RGGI process have argued that the RGGI approach, as presently formulated, may be unconstitutional in several ways. First, industry has argued that RGGI may violate the Compact Clause in the absence of congressional approval (which, to date, the RGGI participant states have expressed no intent to seek). However, no court has ever invalidated an interstate agreement for lack of Congressional consent. Additionally, in the words of relevant Supreme Court precedent, the prohibition of the Compact Clause is directed at a “combination tending to the increase of political power in the [s]tates, which may encroach upon or interfere with the just supremacy of the United States.” It is by no means clear that RGGI rises to this level. Second, industry has asserted that RGGI may impermissibly burden interstate commerce under the so-called “dormant” Commerce Clause—another challenge that may prove difficult to sustain under existing legal precedent. Third, industry has argued that RGGI could intrude on the foreign policy prerogative of the Executive Branch to address global warming in a manner that takes into account emissions from other countries. Although this last argument may be weakened by the Supreme Court’s recent determination in Massachusetts v. EPA that EPA is authorized under the Clean Air Act to regulate greenhouse gas emissions, Massachusetts may simultaneously strengthen an industry argument that the Clean Air Act itself preempts state and regional regulation.
The RGGI scheme will almost certainly have to survive one or more legal challenges before it can be implemented, which in turn casts serious doubt on the program’s much-anticipated 2009 start date.
Key Opinions: None.
See Also: The official RGGI website, http://www.rggi.org/index.htm (the page on stakeholder comments includes written comments from various sources, including from members of regulated industry: http://www.rggi.org/stakeholder.htm). For information about the Western Climate Initiative, a similar effort launched in 2007 by various Western states (AZ, CA, NM, OR, and WA), see http://www.westernclimateinitiative.org/. Nine Midwestern states (Illinois, Indiana, Iowa, Kansas, Michigan, Minnesota, Ohio, South Dakota, and Wisconsin) and a Canadian province launched The Midwestern Regional Greenhouse Gas Reduction Accord in November 2007, the third major regional agreement of its kind. For more information on the initiative, see http://www.midwesterngovernors.org/resolutions/GHGAccord.pdf.
A foreign policy preemption challenge is also expected in the context of the Regional Greenhouse Gas Initiative, the collective effort of various Mid-Atlantic and New England states to combat climate change.
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