Communities for a Better Environment v. California Air Resources Board

Communities for a Better Environment (CBE), a California environmental health and justice organization, filed a petition for writ of mandate against the California Air Resources Board (CARB) and its Executive Officer in California Superior Court. CBE alleged that CARB’s May 29, 2026 approval of amendments to the State’s Cap-and-Invest program (formerly Cap-and-Trade) violated the California Environmental Quality Act (CEQA). Adopted in 2011, California’s Cap-and-Invest program aimed to reduce greenhouse gas emissions by imposing annual aggregate emissions limitations on large industrial facilities. CBE alleged that changes made to the January 2026 proposal in April 2026 (the “15-Day Changes”) would undermine California’s greenhouse gas reduction targets and divert revenue from greenhouse gas-reducing projects and ratepayer assistance funded by Cap-and-Invest auction proceeds. CBE focused particularly on the new “Manufacturing Decarbonization Incentive” (MDI), which grants free emissions allowances to industrial facilities for investments in biofuels, hydrogen, carbon capture, and related infrastructure. CBE argued that the 15-Day Changes’ increased allowances available for the MDI “fundamentally altered” the program without corresponding revisions to the environmental review or an opportunity for meaningful public comment. CBE further alleged that the Final Environmental Impact Assessment (EIA), posted only two days before CARB’s vote, failed to analyze the environmental, air quality, and cumulative impacts of the 15-Day Changes. CBE also alleged that the Final EIA lacked an adequate project description and baseline (including because it failed to disclose increasing impacts of climate change and air pollution), improperly rejected consideration of more stringent alternatives, gave conclusory responses to public comments, and rested on an unsupported statement of overriding considerations. CBE asked the court to set aside CARB’s approval of the amendments, certification of the Final EIA, and adoption of related findings; to enjoin implementation of the amendments pending CEQA compliance; and for a declaratory judgment that CARB’s actions violated CEQA; and for costs and attorneys’ fees.

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