Dealing a major setback to New York’s efforts to reduce acid rain in the Adirondacks, a federal judge yesterday overturned a law penalizing power plants in the state for trading pollution credits to plants in 14 other states. According to U.S. District Court Judge David Hurd, the state’s 2000 Air Pollution Mitigation Law conflicted with the federal Clean Air Act, which allows pollution credits to be freely traded between states. Under the New York law, utilities trading credits of acid-rain forming gases to companies in Midwestern and Southern states would be charged a 100-percent penalty, because such states account for about 70 percent of the acid rain that falls in New York. The ruling was a triumph for the consortium of electricity generators and emissions traders that filed the suit, but a blow to environmental groups and Gov. George Pataki (R), who signed the law.