California's cap-and-trade program started auctioning greenhouse gas pollution permits Wednesday.
It's a central piece of the state's Global Warming Law or Assembly Bill 32, passed in 2006.
The cap-and-trade program places a limit, or cap, on emissions allowed by individual businesses.
An online auction was held Wednesday, where businesses could buy or trade those allowances, giving them the ability to go over their limit or profit if they're under it.
The auction was held despite a lawsuit filed Tuesday by the California Chamber of Commerce. It says the state doesn't have the authority to sell the permits as a way to raise revenue and calls it an illegal tax.
"We're not here to argue climate policy or global warming. We understand AB 32 is the law and that's the law of the land right now. The cap itself is going to lead the businesses to their reductions. It has to be in a cost-effective manner. It has to be technologically feasible," said Shelly Sullivan, Executive Director, AB 32 implementation group.
Many businesses leaders say the program will cost businesses too much money.
One says they can adhere to the cap and reduce emissions without having to buy credits.
The Air Resources Board says its cap-and-trade program gives businesses the flexibility to best decide how to reduce their emissions.
The results of the first auction, who participated and what they paid, will be released next week.