While California`s cap-and-trade program is unlikely to suffer significant setbacks because of the complaint, the case is nonetheless important for its potential to redefine interstate relations and redefine the limits of state authority on the international stage. California has more than 70 international agreements that could theoretically face similar challenges. Similarly, many countries regularly engage with foreign countries on trade issues in order to stimulate their local economies. In addition, the complaint raises questions about the pre-emption power of the federal government for other cross-border activities, such as government and local rules on the environmental impact of international pipelines. Whatever the outcome, the complaint will have a considerable impact, whether it is the refusal, limitation or assertion of the state`s authority to act in this area. The cap-and-trade system has a clear objective: to reduce greenhouse gas emissions compared to 1990. As outlined in the Climate Change Action Plan, the cap-and-trade system is a fundamental driver for achieving Quebec`s ThG reduction targets of 20% by 2020, 37.5% by 2030 and 80-95% by 2050 compared to 1990.  The cap-and-trade system is specifically aimed at issuers who are defined as “any person or commune operating a business in a regulated economic activity” that emits more than 25,000 tonnes of carbon dioxide per year or its equivalent (tCO2e). These sectors include transportation, industry, housing and industry, agriculture, waste and electricity. Now that President Trump has tried to impose his constitutional authority on cross-border agreements to combat climate change, can President Trump bring down California`s cap-and-trade agreement with Quebec? Probably not.
Three factors make it likely that California`s cap-and-trade program will survive constitutional control: in particular, the federal government has argued that California could help Canada meet its climate change goals, as set out in the agreement in violation of the Trump administration`s climate change policy. Supporters also say that the money generated by the purchase of emission credits can be used for other strategies to combat climate change. For example, California`s high-speed rail project, which proponents say will reduce auto and air traffic in the federal state when completed, will be funded in part by the cap-and-trade program. A recent complaint filed by the Trump administration`s Justice Department seeks to block a six-year agreement between California and Quebec that “binds” their respective cap-and-trade programs.