Last night the California Air Resources Board (ARB) adopted a cap-and-trade regulation. The ARB staff presentation outlines the program.
The regulation establishes California’s greenhouse gas (GHG) emission cap-and-trade program. Cap-and-trade is a regulatory approach that controls GHGs from major emission sources by setting a declining limit (the “cap”) on GHG emissions while employing market mechanisms (the “trade”) to cost-effectively achieve the emission reduction targets. The cap-and-trade program is one element of California’s plan to address climate change. Once implemented, the cap-and-trade regulation will provide a fixed limit on GHG emissions from the sources responsible for about 85 percent of the state’s total GHG emissions. ARB estimates that implementation of the regulation would reduce GHG emissions by 18 to 27 MMTCO2e in 2020.