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California Cap-and-trade Legal

Utah moves to sue California over cap-and-trade backed coal boost

Lawmakers from the state of Utah suggested Monday that the state set aside $2mn to sue California over rules aimed at inflating coal-fired power prices.

The proposal, which was set forth by Utah House of Representatives member Mike Noel (R), challenges the legality of California’s cap-and-trade program, wherein California utility providers pay an additional $15 per megawatt hour (Mwh) to buy power from coal-fired Utah power plants.

Stanley Young, California Air Resource Board (CARB) spokesman, says the state’s cap-and-trade system is aimed at contracting climate-changing gases no matter the coals origin.

While the motion was swiftly passed through a subcommittee hearing this week, Utah Senator Jim Dabakis (D) represented the lone public objector, calling the lawsuit a waste of taxpayer money.

“This is the state taking millions, like they do every year, and going up to the dome of the Capitol and just throwing it out there, wasting it,” Dabakis said, further adding that this lawsuit has no chance.

Dabakis’ sentiments were shared amongst multiple market participants Thursday, with one going so far as to say, “if they (Utah) bring a suit, California should file a counter suit for wasting everyone’s time.”

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