Vermont could clear way for new emissions rules

By Scott Malone

BOSTON (Reuters) - A Vermont judge could soon clear the way for nearly a dozen states to surmount auto industry protests and limit emissions from cars and light trucks to protect the environment, legal experts said.

The rural northeastern state in 2005 followed California's lead in calling for a 30 percent cut in the amount of carbon dioxide, the main gas blamed for global warming, emitted from automobiles starting with 2009 models. U.S. automakers have sued both states, and Rhode Island, seeking to have the rules overturned.

Vermont's suit is the first to go to trial.

Arguments wrapped up on Tuesday after nearly a month of testimony, and legal experts expect U.S. District Court Judge William Sessions to rule before September.

"This will be an important signal to the other cases, so I do anticipate that there will be an important precedent set in this case," said Daniel Esty, the director of Yale University's Center for Environmental Law and Policy.

The Vermont trial began shortly after the U.S. Supreme Court ruled in an unrelated case that carbon dioxide can be regulated as a pollutant, rejecting a 2003 argument by the federal Environmental Protection Agency that it did not have authority over carbon dioxide.

That finding, legal experts said, weakened the auto industry's argument that the 10 states that have adopted the rules are overreaching in regulating carbon dioxide emissions. Fuel efficiency is federally regulated.

"I expect Vermont to win, and I think the deference shown to the states as sovereign entities by the Supreme Court recently sends a strong signal to this court that it needs to be very deferential to Vermont's desire to protect its air," Esty said.