Ratifying Kyoto Via Local Actors: Accomplishments and Limitations of Local Cap-and-Trade Programs

• Date: 01 August 2010
• Author: Roger R. Martella and James W. Coleman

40 ELR 10780 ENVIRONMENTAL LAW REPORTER 8-2010

R E S P O N S E

Ratifying Kyoto Via Local Actors:

Accomplishments and Limitations

of Local Cap-and-Trade Programs

by Roger R. Martella and James W. Coleman

Roger Martella is a partner in the Environmental Practice Group at Sidley Austin LLP. He recently rejoined Sidley Austin after

serving as the General Counsel of the U.S. Environmental Protection Agency, where he led the team responsible for developing the

federal government’s climate change legal framework in response to the landmark Supreme Court decision Massachusetts v. EPA.

James Coleman is an associate at Sidley Austin LLP. His practice focuses on climate change, including climate

legislation, climate tort suits, NEPA, state low carbon fuel standards, and EPA’s full suite of GHG rulemakings.

The authors of the current piece1 argue that “the May-

ors Climate Protection Agreement illustrates that the

notion of an exclusive, national authority to deal with

issues deemed ‘foreign’ cannot succeed.”2 e argument is

that while “rulemakers try to classify a set of problems as

categorically national or local, the world in which they are

operating belies the boundaries imposed.”3 ey see groups

such as the U.S. Conference of Mayors and the National

Governors’ Association playing a natural role in addressing

issues that, like climate change, have ramications simulta-

neously at the local, national, and international levels. Noting

that these groups operating in this capacity are technically

translocal nongovernmental organizations of local govern-

ment ocials, the authors helpfully dub them TOGAs.

e authors convincingly argue t hat TOGA s are of

increasing importance across the spectrum of political issues.

But it is worth noting that more traditional orga nizations

of local actors a re already addressing the specic issue high-

lighted by the authors—global climate change—through

regional greenhouse gas (GHG) cap-and-trade systems. ese

regional systems have sprung up across the United States and

across the world. TOGAs, in turn, have the opportunity to

play a critical role in bridging these distinct local eorts to

address a fundamentally global challenge.

e authors also identify specic legal doctrines—such

as federal preemption—as impediments to the eorts of

TOGAs because these doctrines privilege uniform national

laws over patchworks of local laws. Consistent with this

theory, regional cap-and-trade systems are indeed imperfect

1. Judith Resnik et al., Kyoto at the Local Level: Federalism and Translocal Orga-

nizations of Government Actors (TOGAS), 40 ELR (E. L.  P’ A.

R.) 10768 (Aug. 2010) (a longer version of this Article was originally pub-

lished at 50 A. L. R. 709 (2008)).

2. Id. at 10775.

3. Id.

because of their limited geographical scope, a challenge high-

lighted with climate change due to the lack of nexus between

regulating GHG emissions at the local level and local impacts

from climate change. But the pursuit of a comprehensive

national GHG regime, even if it preempts local systems to

some extent, does not by any means eliminate critical oppor-

tunities for loca l actors, coordinated by TOGAs, to play a

key role in contributing to climate change solutions.

I. Regional GHG Cap-and-Trade Regimes

Despite climate cha nge being a global issue warranting a

national, if not a global, response, in the United States, state,

local, tribal, and regional governments have led the charge

to reduce GHG emissions. ese eorts have taken numer-

ous forms, including eorts by California to reduce GHG

emissions from cars and light-duty trucks, low carbon fuel

standards, controls on stationary sources, and even consumer

energy eciency standards for appliances and light bulbs.

Perhaps most preva lent among such eorts has been the

establishment of state and regional market-based cap-and-

trade systems. Cap-and-trade regimes function by placing

a quantitative cap on emissions of a pollutant from a given

category of sources. e overall cap is broken into smaller

quantities of the pollutant, termed allowances, that a source

must possess if it plans to emit the pollutant. us, the num-

ber of allowances held by a source determines how much

pollutant it can emit. e cap administrator usual ly either

(i) distributes these allowances for free to existing sources,

or (ii) sells the allowances at an auction. Following this ini-

tial distribution, sources may buy or sell these allowances as

their anticipated emissions change. Cap-a nd-trade systems

often also allow covered sources to purchase osets instead

of a llowances. Osets are certied reductions in emissions

from sources not subject to the c ap-and-trade regime. ese

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