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California adopted the nation’s first cap-and-trade program to help reduce greenhouse gas emissions and meet the state’s climate change goals. The cap-and-trade program comes out of California’s AB 32, a landmark bill on emissions passed in 2006.  Although industry representatives and unions questioned its impact on jobs, and environmental justice groups said the program allowed polluting in low-income neighborhoods to continue, the California Air Resources Board voted unanimously to adopt the program.  Read more about this landmark cap-and-trade program.  

 

The first phase of the program will apply to major industry, like oil refineries and electric utilities, starting in 2013.  In 2015 the program will be extended to natural gas and transportation fuel industries.  California chose the cap and trade program to meet its greenhouse gas reduction goals; the state aims to be at 1990 GHG levels by 2020.  

 

There are various approaches to curbing carbon emissions, both regulatory and through the market, with each system raising its own set of advantages and disadvantages.  The EPA offers a basic explanation of cap and trade systems. 

 

Will other states follow suit? The verdict is still out.  With the economy and jobs being a current hot button issue, decision makers will have an eye out for how the program effects the economy.  But while industry reps expressed concern about decreasing jobs, California’s bold move continues to showcase the state as a leader in clean energy.  While the program will likely face obstacles around implementation and execution (as any groundbreaking policy does, particularly one that is the first of its kind in the nation), the Golden State’s program demonstrates  a commitment and promise to the clean tech industries.  Such a loud and clear signal continues to position California as a welcoming home for clean tech businesses, and with it the jobs of a green economy.