WASHINGTON, Jan 6 (Reuters) - An appellate court will hear arguments on Wednesday on whether Governor Chris Christie illegally withdrew New Jersey from a regional trading scheme aimed at cutting carbon emissions, raising hopes among environmental groups that the state might be forced to rejoin.
A three-judge panel in Trenton will hear oral arguments from green groups Environment New Jersey and the Natural Resources Defense Council that Christie did not follow proper administrative procedures when he pulled the state out of the Regional Greenhouse Gas Initiative (RGGI) at the end of 2011.
Christie, a Republican often mentioned as a possible presidential candidate, claimed the RGGI was costing rate payers too much and did not deliver environmental benefits to New Jersey.
The then-10-state program, which was created by Republican and Democratic governors of the northeast and mid-Atlantic in the early 2000s, requires power plants to reduce their carbon emissions by buying and selling emission permits.
The nine current RGGI states are calling for the federal Environmental Protection Agency (EPA) to use the RGGI program as a template for other states to comply with rules expected to be proposed this summer that would curb carbon from existing power plants, the largest domestic source of emissions.
New Jersey's Department of Environmental Protection (DEP) said in its court filings that it followed procedure because it informed the public of "the effect of New Jersey's withdrawal from RGGI" on its website.
Environmental groups, however, said that simply posting a statement declaring an end to the rules was not in compliance with state law. Such moves, they argue, require a public comment period.
Dale Bryk, director of the air and energy program for the NRDC, said now is a perfect time for New Jersey to re-enter the RGGI, with federal rules are on the way and citizens demanding action in the wake of Superstorm Sandy in late 2012, which caused billions of dollars of damage in the state.
"The reality is, the program (RGGI) has continued to get stronger. The governor increasingly is being shown to be out of step with New Jersey and the greater northeastern U.S.," she said.
Bryk said that residents of New Hampshire, another RGGI member, backed the program when the state legislature voted to withdraw from RGGI in 2011.
States that still participate in RGGI say the program has been a major boon to their economies. The program's quarterly carbon emission permit auctions have netted $2.4 billion to the RGGI region since the end of 2008.
State lawmakers have been trying to pass legislation that would enable New Jersey to re-enter RGGI. The proposals have majority support, but not enough backing to override the governor's expected veto.