Yesterday Pacific Legal Foundation filed an amicus brief asking the United States Supreme Court to review a Ninth Circuit decision which upholds a California fuel import restriction against a commerce clause challenge brought by several fuel producers and consumer groups. We are pleased to be joined on the brief by our friends at Cato Institute, National Federation of Independent Business Legal Center, Reason Foundation, the California Manufacturers and Technology Association, and the Energy and Environment Legal Institute, all urging the Court to review this very important case.
There is a lot of debate about greenhouse gas emissions, primarily carbon dioxide from power plants, manufacturing, and transportation, and whether and how these relate to changes in the long term climate. California’s government has decided to reduce local greenhouse emissions under a state law known as AB 32. The state has an emissions cap and trade program in place, which rations fuel for most uses, and has forced significant increases in vehicle mileage standards as well.
One of the other rules that the California Air Resources Board has imposed, however, goes beyond the Golden State, and tries to regulate emissions sources all over the world. The Low Carbon Fuel Standard says you can’t import fuel into California unless you reduce the greenhouse emissions from making that fuel in Indiana, or Canada, or Brazil, or wherever it was produced.
You might wonder how one state can regulate the fuel production supply chain in other states and around the globe. And the answer is that under our Constitution, it cannot. Our Framers designed a federal system, in which each of the states attends to matters within its own borders, and does not have power to regulate in other states. This is to prevent states from engaging in protectionist trade conflicts with each other, a problem that was a very real backdrop to the ratification of our Constitution.
The United States Supreme has repeatedly rebuffed state efforts to regulate their neighbors, in cases involving imported milk, coal, fish, fresh produce, alcohol, even waste being sent to landfills. So it seems pretty clear that California cannot regulate how crude oil is produced in Canada, or how ethanol is produced in Nebraska or Brazil.
But, when a large group of affected parties sued California over its cross-border mandates, the Ninth Circuit Court of Appeals refused to put a stop to it, and instead applauded California for taking “legal and political responsibility for greenhouse gas emissions, wherever they occur.”
The plaintiffs have appealed the case to the United States Supreme Court, and out brief supports their petition. States trying to regulate other states’ citizens and businesses is a basic violation of our constitutional system of federalism, and this case is particularly important because one state is trying to micromanage the entire national fuel supply chain.