Emissions cap proposal may proceed: court

New Mexico greenhouse gas cap hearings resume after a Supreme Court ruling, allowing the Environmental Improvement Board to collect expert testimony, public comments, and regulators' input on an emissions cap, climate policy, and economic impacts.

The New Mexico Supreme Court cleared the way for a state regulatory panel to resume consideration a petition to establish a cap on greenhouse gas emissions in the state.

The justices vacated a lower court ruling similar to a bid to block EPA rules that effectively halted the state Environmental Improvement Board's process for gathering expert testimony and public comments related to an environmental group's emissions proposal.

Lawyers for the group, New Energy Economy, and the regulatory panel had asked the high court to overturn a preliminary injunction that Lovington Judge William Shoobridge granted in April while he considered the merits of the case. Opponents had filed a lawsuit in his court, arguing that the panel did not have authority to regulate greenhouse gases, much like when states sued EPA over federal greenhouse gas rules, and that such a regulation would ultimately harm New Mexico's economy.

Petition supporters argued that the case raised questions about separation of powers and if allowed to stand, Shoobridge's ruling would cripple state agencies' ability to carry out appointed responsibilities.

Chief Justice Charles Daniels agreed, saying the judicial branch must exercise its power, as in a Clean Air Act ruling by federal courts, without interfering in administrative processes.

Daniels said the case would be remanded back to the Environmental Improvement Board, with parallels to efforts to revise EPA air rules in North Carolina, which had initially scheduled public hearings on the matter for later this summer before the process was stalled by the legal wrangling.

Dr. John Fogarty, a Santa Fe physician and president of New Energy Economy, was pleased with the decision.

"I think the justices did their homework. They did their research and looked at the merits of the case and made a good ruling that puts democracy back on track," Fogarty said.

With the ruling, Fogarty said expert witnesses assembled by his group will be able to present their case to regulators and speak to what he described as serious social, economic and public health problems that stem from unchecked emissions and global warming.

However, the debate over the merits of capping greenhouse gas emissions is far from over.

Jeffrey Wechsler, an attorney who represented four state lawmakers, the New Mexico Oil and Gas Association and other industry groups concerned about the proposal, citing a recent EPA power plant case as context, said his clients plan to present their own testimony to the Environmental Improvement Board.

"We'll get to weigh in with our thoughts about the merits of this proposal," he said. "Depending on what the board does, there is the opportunity for appeal or another district court action."

New Energy Economy initially petitioned state regulators in December 2008 to impose a cap that would affect any business that emitted more than 10,000 metric tons of carbon emissions per year.

A revamped proposal submitted in March specified a phased-in program that would include only electricity generators and businesses in the oil and gas industry that emit more than 25,000 metric tons per year. It sought to reduce greenhouse gas emissions from those sources by 3 percent each year from levels set in 2010.

Critics question whether the board can set a cap since it hasn't established an air quality standard for greenhouse gases.

Public Service Company of New Mexico, one of the plaintiffs, has argued that a state cap on greenhouse gasses would be costly for businesses and utility customers, potentially raising power rates for many, and that the emissions debate should be settled by the federal government.

New Energy Economy argues that the state Legislature created the board and authorized it to hold public hearings for the purpose of considering air pollution regulation and public welfare protection.

Fogarty said Congress is far from adopting climate change legislation that would address greenhouse gas emissions so states need to act.

"The real attention is going to be focused on the states, where Texas has tried to block EPA rules before, and New Mexico being an energy producing state, taking action on global warming I think sends a strong signal," he said.

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