Cap-and-Trade Extension Bills Debated in Sacramento

Legislators in Sacramento are currently debating three different bills which would extend and alter the California Cap-and-Trade Program.

The cap-and-trade program is administrated by the California Air Resources Board (CARB). The program requires the largest emitters of greenhouse gas emissions (energy producers, processing plants, etc.) to reduce their emissions over time. It also sets up the California Carbon Market, where greenhouse gas emission permits are bought and traded. The auctioning of the permits generates funding for climate change programs. More information on the program can be found here.

The three cap-and-trade extension bills currently in state assembly and senate each extend it to 2030 but change the program in different ways:

AB151 (Burke): Sets up the Compliance Offsets Protocol Taskforce. The taskforce would provide guidance and reports on training and issues for workers impacted by the transition to renewable energy sources.
AB378 (Garcia): Attempts to make changes to the program to address high air pollution burdens in low income communities. It would also allow CARB to directly regulate industrial facilities that do not meet their reduction targets.
SB775 (Wieckowski): Lets the cap-and-trade program expire and would restart a similar program without offset credits, creates new floor prices for permits, caps permit prices, and more starting in 2021. SB775 would create a climate dividend for Californians to offset future increases in energy prices.

Governor Jerry Brown is pushing for an extension with the approval of the state budget by mid-June.

The program’s selling of permits has funded CDFA’s Healthy Soils Initiative, the State Water Efficiency and Enhancement Program (SWEEP), the Diary Methane Program, and the Sustainable Agricultural Land Conservation Program. These programs provide funding to Californian farmers and ranchers for projects that reduce greenhouse gases. For more information, please contact the CCOF Policy department.