Last week, the Circuit Court of the City of Richmond ruled in favor of the Virginia Department of Environmental Quality (DEQ), keeping the Commonwealth’s successful cap-and-trade program in place. The lawsuit, filed by the Virginia Manufacturers Association, alleged that the program violated Virginia’s Clean Energy & Community Flood Preparedness Act when it amended its carbon trading program regulations to allow for the direct auction of carbon dioxide allowances. The court determined, however, that the DEQ did not create an illegal tax through this mechanism.
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