In PacifiCorp v. Sixkiller, No. 24-4803, 2026 WL 2277099 (9th Cir. Aug. 7, 2026), the Ninth Circuit affirmed dismissal with prejudice of PacifiCorp’s challenge to Washington’s Climate Commitment Act (“CCA”). PacifiCorp argued that the Washington State Department of Ecology violated the Dormant Commerce Clause through enforcement of decarbonization requirements under the CCA by providing no-cost greenhouse-gas allowances for electricity serving Washington customers, while requiring PacifiCorp to purchase allowances for emissions associated with electricity exported from its Washington facility to customers in other states.
Washington’s CCA requires covered emitters to obtain allowances for greenhouse-gas emissions. Electric utilities subject to Washington’s Clean Energy Transformation Act (“CETA”) receive no-cost allowances for emissions associated with electricity sold to Washington customers. CETA separately requires utilities serving Washington customers to transition toward carbon-neutral and ultimately carbon-free electricity. Electricity exported outside Washington is not subject to CETA and therefore does not receive the corresponding no-cost CCA allowances.
The Ninth Circuit held that PacifiCorp failed to plausibly allege unconstitutional discrimination because Dormant Commerce Clause discrimination requires different treatment of substantially similar economic interests. The Court reasoned that emission associated with electricity serving Washington customers and emissions associated with exported electricity were not similarly situated. Washington electricity is already governed by CETA’s separate decarbonization requirements, while exported electricity is not. The CCA’s no-cost allowances therefore operate alongside CETA to avoid overlapping regulatory burdens rather than simply providing an economic preference to Washington consumers.
The Court also rejected PacifiCorp’s reliance on cases involving discriminatory taxes and surcharges. Unlike those cases, Washington was imposing different environmental requirements on emissions already subject to different regulatory regimes. The Court emphasized that granting PacifiCorp’s requested relief could leave its exported generation subject to neither CETA’s decarbonization mandate nor the CCA’s allowance-purchase requirement. The Court affirmed dismissal without leave to amend and the denial of PacifiCorp’s preliminary-injunction request as moot.
Judge Bress dissented, reasoning that the CCA facially disadvantages interstate electricity sales and that the case should have proceeded to factual development concerning whether CETA’s burdens and the CCA’s no-cost allowances were roughly equivalent.
The decision is significant for utilities and other businesses subject to state environmental programs. It indicates that different regulatory treatment affecting interstate operations will not necessarily violate the Dormant Commerce Clause where the regulatory activities are subject to materially different environmental regimes.