Collection: Non-Cascadia Climate Action

While Cascadian climate hawks have been fighting rearguard actions against proposed pipelines and coal trains, California has been rolling out an ambitious carbon cap. Such a cap is the principal alternative to a carbon tax—such as British Columbia’s carbon tax shift—as a method for putting a price on carbon in Oregon and Washington. It’s an option Oregon will consider next year in its impending revenue-reform debate. In Washington, the Golden State’s cap appears to be the model that Governor Jay Inslee favors: he recently convened a panel of leaders to design a state “Cap and Market” system.

The panel, after deliberation, may conclude that the best choice is for Washington to simply photocopy California’s rules and join the Golden State’s system. California actually designed its carbon market so that other states can plug themselves into it. Or the panel could opt to design its own system. Either way, Cascadia’s climate warriors would do well to study how their southern neighbor put a price on carbon, because the Golden State’s rules form the dominant carbon trading market in North America. Just last week, the state auctioned more than 20 million carbon-emission permits at $11.50 apiece.

Here are 17 things worth knowing about that market. Some of them are details, even arcane ones, but the details of a carbon pricing system matter enormously. They matter more than whether the underlying mechanism is a tax or a cap. (Sightline laid out the details of good design in Cap and Trade 101.)

1. The cap is strong . . . until 2020.

California’s carbon cap—the flagship in an armada of global warming policies launched in 2006 as Assembly Bill 32 (AB 32)—came into force in January of 2013, initially covering the electric-power sector and large factories with giant carbon footprints. Next year, it expands to the carbon dioxide from gasoline, diesel, natural gas, and other fossil fuels (and to other greenhouse gases such as methane). By then, the Cali cap will be the most comprehensive, though not the most aggressive, carbon-pricing regime in the world.

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