Georgetown Law

New Mexico Environment Board to Consider Repeal of Cap-and-Trade Rules


New Mexico’s Environmental Improvement Board (EIB) has agreed to consider repealing the State’s two separate cap-and-trade regulations passed by the board in late 2010.  The New Mexico Court of Appeals supported the agreement, reached in a settlement with industry parties challenging the regulations in court, by remanding the litigation to the board on July 19. (Public Service Co. v. New Mexico Environmental Improvement Board, No. 31,020).

The reshuffled EIB board, all appointees of new Governor Susana Martinez (R), will conduct a series of public hearings beginning Nov. 8 in response to petitions to repeal the rules filed by plaintiffs in the litigation, including utility Public Service Company of New Mexico. The petitions challenge two cap-and-trade regulations:

The petitioners argue that the GHG limits would have "significant economic costs," including a slowdown in state oil and gas production, that they would not provide discernible health or environmental benefits, and that they were improperly adopted.

In addition, EIB will also consider a petition to repeal GHG emissions monitoring and verification requirements. (Petition to Repeal Reporting and Verification of Greenhouse Gas Emissions 20.2.300 & 301, No. 11-17).

Environmental organization New Energy Economy filed a motion on July 29, 2011, in response to one of the repeal petitions, arguing that the EIB has no authority to revise or repeal a previously adopted rule, and arguing that the board members are disqualified because of their “manifest bias and lack of impartiality.” A New Mexico Supreme Court ruling on July 27, 2011 established New Energy Economy as a party in the appellate case, overruling the appellate court’s previous decision. (New Energy Economy v. Hon. Linda M. Vanzi, No. 33,074). 

Earlier this year, the Martinez administration moved to block publication of one of the cap-and-trade regulations in the state register, which would have prevented the rule from being finalized. New Energy Economy challenged the action in court, arguing that the administration could not stop publication after the rulemaking had been completed, and the New Mexico Supreme Court agreed, resulting in the publication of the rule on January 31, 2011.   (New Energy Economy v. Martinez, 2011 NMSC 6).

Several bills were also introduced to repeal the cap-and-trade regulations in the Democratic-controlled state legislature, but none were successful before the legislature’s adjournment.


New Energy Economy has a procedural summary here: