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Ninth Circuit Hears Appeal in Challenge to California

Ninth Circuit Hears Appeal in Challenge to California’s Low-Carbon Fuel Standards

 

October 16, 2012

 

On October 16, 2012, the U.S. Court of Appeals for the Ninth Circuit heard oral argument in a challenge brought by a number of groups, including ATA, to the low-carbon fuel standards promulgated by the California Air Resources Board (CARB). The regulation requires fuel providers (refiners, importers and blenders of fuel) to reduce the carbon intensity of the fuels they sell in California. Because the regulation includes emissions associated with the production and transport of fuels in assigning carbon intensities, fuels produced outside of California inherently have a higher intensity rating than otherwise equivalent fuels produced in-state.  The lower court agreed with ATA and the other challengers that this violated the dormant Commerce Clause doctrine, which prohibits states from discriminating against out-of-state commerce by providing an economic advantage to in-state interests.