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U.S. President Barack Obama speaks to the press after hosting a roundtable with CEOs about climate change Oct. 19, 2015 in Washington, DC. The group reportedly discussed carbon mitigation, sustainability and how new technologies can support the efforts.Aude Guerrucci-Pool/Getty Images

President Barack Obama's signature action in battling climate change came under fire on Friday from 24 states and top business groups, which asked a U.S. appeal court to block the administration's plan to curb carbon-dioxide emissions from power plants.

The states, including Republican-led West Virginia, Ohio and Texas, challenged the Environmental Protection Agency's Clean Power Plan, which aims to lower emissions from the country's power plants by 2030 to 32 per cent below 2005 emission levels. Business groups, led by the U.S. Chamber of Commerce and the National Association of Manufacturers, filed their own petition asking the court to block the EPA rules.

The court action comes as the Obama administration is negotiating with other countries to conclude an ambitious climate agreement in Paris in December. Republicans in Congress and across the country continue to reject Washington's efforts to cut emissions, and are sending signals to global partners that Mr. Obama's commitments at the United Nations Climate Change Conference may not be honoured by a future Republican administration.

In a session in Bonn this week, negotiators made some progress toward a deal, but still face bitter divisions over affluent nations' funding for climate action – both emission reductions and adaptation – in the developing world. Poorer nations are demanding more than $100-billion (U.S.) a year in financing from taxpayers and companies in the industrialized world, which they hold responsible for the growing climate-change threat.

Prime-minister-designate Justin Trudeau is preparing to attend the climate conference in Paris with several provincial premiers, and are pledging that Canada will play a leadership role after a nearly decade in which critics accused the Conservative government of lagging on the issue.

The EPA plan is the cornerstone of the U.S. administration's commitment to reduce overall emissions by up to 28 per cent by 2025, as power plants contribute 40 per cent of U.S. emissions. Many utilities are already shifting from coal-fired power to natural gas and renewable sources. Canadian hydroelectric and renewable-power producers expect to export clean power to help states meet their emissions targets.

But state attorneys-general filed a petition with a U.S. appeal court in Washington on Friday, saying the EPA plan exceeds the limits of the federal Clean Air Act.

"As Attorney-General, I have a responsibility to protect the lives of millions of working families, the elderly and the poor from such illegal and unconscionable federal government actions," West Virginia's Patrick Morrisey said. "It's the people who can afford it least who are going to be affected the most."

Business lobby groups argue that the EPA failed to take into account the serious concerns expressed by states and industry regarding the plan's cost, its implementation and legality. They complain that the administration has "bypassed" Congress, though Mr. Obama has repeatedly urged congressional leaders to pass climate legislation that would take the place of the EPA rules.

While U.S. business associations have consistently fought climate regulations, their Canadian counterparts have been more amenable, with both the Canadian Chamber of Commerce and the Manufacturers & Exporters Association endorsing market-based carbon pricing.

Environmental groups insist that there is little likelihood that the appeal court will block the EPA regulations, noting that the Supreme Court has ruled that the agency has the authority to regulate greenhouse-gas emissions.

Even as some states pursue legal action, virtually all have begun to address how they will meet the Clean Power Plan targets, David Doniger, senior attorney for the Natural Resources Defence Council, said in an interview on Friday. He said state governments would rather design their own approaches – as allowed by the EPA rules – than sit idle and allow Washington to intervene directly.

"The more they engage in that planning, the more it becomes apparent that there are practical ways to comply," Mr. Doniger said, "and companies and other stakeholders get more invested in how they're going to do it rather than how they're going to fight it."

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