PHOENIX — A spat between two state officials over use of a $1 million penalty against a polluter has erupted into a full-blow debate over global warming and whether Arizona should impose ne — and potentially expensive — greenhouse gas emission limits.

 Gary Pierce, a member of the Arizona Corporation Commission, said the Department of Environmental Quality is pursuing an agenda that ultimately would force Arizona companies to cut carbon dioxide emissions. Pierce said the move, being done at the behest of Gov. Janet Napolitano, could ruin the state’s economy on th basis of an unproven theory.

 But DEQ Director Steve Owens said global warming is a fact calling it a “no brainer’’ that reducing carbon dioxide emission will help prevent further warming.

 The fight comes as the Western Climate Initiative is set t release rules Tuesday detailing how much each participating stat — including Arizona — will have to reduce greenhouse ga emissions.

 Napolitano’s office is refusing to release details, wit gubernatorial press aide Jeanine L’Ecuyer saying all they have is a draft even though Owens is co-chair of WCI. Even th “stakeholders’’ who the governor said were being consulted including affected industries, said no information has bee shared with them.

 But what’s already known is that the plan is built around a “cap  and trade’’ system to start in 2012.

 The essence of such a program is that it calculates how much greenhouse gas each source emits and sets a schedule of how much each must cut, and how fast. Companies could either spend th money to meet those reductions or purchase pollution credits from other firms who cut emissions more than the target.

 But that means higher costs, especially for Arizona utilities which depend heavily on fossil fuel power plants. And an additional costs they incur would be passed on to their customers.

 Several business groups already have raised questions about instituting a such a system, particularly one that covers only  few states and provinces.

 Glenn Hamer, president of the Arizona Chamber of Commerce and Industry, said imposing new costs on businesses here would make them less competitive than firms in other states that have no such limits. Hamer even questioned having national standards, given that overseas companies do not face the same restrictions.

 The fight between Pierce and Owens is a microcosm of that larger dispute.

 It started with a settlement DEQ negotiated last month with Honeywell International Inc. over environmental violations. part of the deal, Honeywell agreed to give $1 million to Western Governors Association to finance the work of the Western Climate Initiative to draft the cap and trade system.

 Pierce questioned using these dollars for what is known as  “supplemental environmental project,’’ saying the funds should have been used to benefit communities affected by Honeywell’s pollution.

 But Owens, in his response to Pierce, did more than defend th legality of the move. He made it personal.

 “It is clear that your opposition to this SEP stems from your personal belief that climate change is not real, despite th overwhelming scientific consensus that not only is climate change happening but human activities are contributing significantly to it,’’ Owens wrote.

 “I readily accept the earth is warming,’’ Pierce told Capitol Media Services.

 “The reality is, the human part is a theory,’’ Pierce continued, saying that the change just as easily could be caused by “sola activity, which a lot of science believes.’’

 Pierce said the real question is how much should be spent on a cap and trade program to reduce those emissions “and how bad you want to hurt Arizona’s economy to do it,’’ given questions that remain about whether it actually would slow warming.

 The issue is more than academic to Pierce and other commission members: If electricity costs more from coal- and gas-fired plants, utilities will seek to pass on the difference t customers. Commission member Bill Mundell said he has seen figures that a cap and trade system could raise the cost of electricity produced by fossil-fuel power plants by anywhere from $50 to $80 a month for residential customers.

 Ed Fox, who is in charge of environmental affairs for Arizona Public Service, said he can’t say yet how much his company’s power-generating costs might go up. He said the governor’s office, while inviting input from affected industries an environmental groups, has not been forthcoming with drafts and

 details.

 There also is the question of whether Napolitano can impose

 limits on her own.

 The commissioners already are arguing they need to approve

 anything that affects electricity costs. That view also is shared

 by most of the candidates for the three open seats on the

 commission.

 And Hamer said he believes a cap and trade system requires

 legislative approval.

 Napolitano was noncommittal on what parts of the new regulations

 she will seek to enact on her own by rule.

 “I’m waiting to see what the recommendations are to review

 those,’’ she said. “Obviously, things that require legislative

 approval we’d like to work with the Legislature on those.’’

 But the governor already has staked out her turf: She vetoed

 legislation earlier this year that would have barred DEQ from

 imposing greenhouse gas emission standards without approval from

 lawmakers.

 And it was Napolitano who directed Owens to craft rules requiring

 that vehicles sold in Arizona beginning in 2011 meet new

 standards for greenhouse gas emissions, a move everyone admitted

 will drive up the cost.