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California’s Global Warming Law Could Cause Businesses To Flee State

A state law that requires power plants, factories and other businesses to cut greenhouse gas emissions could cause energy prices to rise and prompt businesses to delay expansion or flee California, according to a study by the state Legislative Analyst’s Office.

The landmark global warming law, which is being enforced in phases, could put the state’s businesses at a competitive disadvantage unless other states and the federal government come up with similar plans, the study by the nonpartisan agency said.

“Economic leakage” could occur as businesses move to states with lower regulatory costs, the report said. Industries that rely heavily on energy use and trade, such as aluminum, chemical or steel producers, could be disproportionately vulnerable.

The California Jobs Initiative said Tuesday that the state’s “go-it-alone approach” would destroy as many as 1.1 million jobs. The coalition, which includes trade groups, politicians and advocacy groups, has a proposition planned for the November ballot that would delay implementation of the law until the state’s 12.6% unemployment rate declines.

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