Nov 20 - McClatchy-Tribune Regional News - Dale Kasler The Sacramento Bee, Calif.

California's epic battle with the world's automakers over global warming neared a climax in a courtroom here Monday.

Lawyers for the state and the auto industry clashed over the fine points of a California law that would force manufacturers to significantly reduce vehicles' greenhouse gas emissions, starting with next year's models. The auto industry, arguing that the technological obstacles would explode the prices of new vehicles -- harming sales and erasing tens of thousands of jobs at America's auto plants -- is suing to have the law tossed out.

State lawyers pressed for a ruling Monday that would dismiss the suit outright. The automakers' lawyers sought a ruling that would award them victory without a trial. U.S. District Judge Anthony Ishii said he will rule at a later date.

The law, AB 1493, takes aim at tailpipe emissions, which account for about 40 percent of California's greenhouse gases. It requires a 30 percent reduction in those emissions by 2016.

Even if the law survives the challenge in Fresno, the state still needs a ruling from the U.S. Environmental Protection Agency before it can take effect. Two weeks ago California sued the Bush administration, saying that the EPA is dragging its feet over the state's request for the ruling.

The flood of litigation shows how California has struggled to turn its lofty ideas on global warming into something with teeth. It has been fighting the automakers for three years over AB 1493, which passed in 2002. The fight with the EPA could mean considerable delays in implementation of the law.

The law's fate has an impact well beyond California's borders. Eleven other states have adopted copycat laws, and five others are considering doing so, but they can take effect only if California is allowed to implement its law.

Monday's tussle turned on a key argument by the automakers: that the California law would require a huge leap in fuel-economy standards, an issue they say is exclusively under the authority of the National Highway Traffic Safety Administration. The automakers contend mileage standards would have to improve to 43 mpg from the current 27.5 mpg for passenger cars by 2016.

"They call it a greenhouse gas regulation. ... At its core, this is a fuel-economy standard,' attorney Andrew Clubok, representing the world's automakers, told the judge. He said California regulators' internal documents refer to "the dreaded two words: 'fuel economy.' "

Clubok said California is doing something that is fundamentally unfair. It is seeking a "free license" to impose its will on Michigan, Ohio and other states where car manufacturing is a big part of the economy.

"This regulation will lead to job losses -- the only question is the magnitude," he said.

Automakers have calculated that AB 1493, which was signed into law by then-Gov. Gray Davis, could raise vehicle prices by as much as $6,000 per vehicle. "There's no free lunch," Clubok said in an interview during a break, adding that job losses in auto plants would total at least 65,000 as vehicle sales plunge.

California officials dismiss those projections, saying automakers already have developed, or are working on, most of the technological improvements needed to meet the law. They believe the additional cost per vehicle is no more than $1,800.

They also said that if the California standards are too burdensome or costly for the automakers to meet, that's for the EPA to decide.

"The forum for that is the EPA waiver proceeding," attorney David Doniger, representing the Natural Resources Defense Council, said in an interview. The environmental organization is working with the state to defend against the automakers' lawsuit.

During Monday's two-hour hearing, Doniger and Marc Melnick, a deputy state attorney general, told the judge that three big legal decisions this year give added weight to California's arguments.

First, the U.S. Supreme Court ruled that the EPA has a duty to clamp down on greenhouse gas emissions just as it regulates other forms of air pollution.

Second, a federal judge in Vermont -- one of the 11 states to adopt a law identical to California's -- recently ruled against a similar suit by the automakers. A lawsuit by the automakers against Rhode Island, which also has passed an identical law, is pending.

Finally, last week a federal appeals court in San Francisco ordered the Bush administration to toughen the fuel economy standards for sport-utility vehicles, minivans and pickup trucks. The court said the administration had overlooked, among other things, the impact those vehicles have on global warming.

State officials believe the three cases will create a domino effect that will tip the Fresno case their way. But they also acknowledge that a huge battle still looms at the EPA.

Federal law says only the U.S. government can regulate air pollution. There's one exception: California can impose its own standards if it gets a waiver from the EPA. Other states can then copy California's standards.

California has received more than 40 such waivers on issues ranging from catalytic converters to smog restrictions. But state officials anticipate problems with AB 1493 and have already threatened another suit against the Bush administration if the waiver request is denied.

"We can't do anything until we get an EPA waiver," Melnick said.