TORONTO, 18 July – The California state legislature’s approval to extend the state’s cap and trade law until 2030 is a welcome boost for market confidence, says IETA.
The state Senate and Assembly approved the extension of the market last night. In a bipartisan vote supported by two-thirds of each body, the approval brings to an end months of uncertainty over the market’s future and gives clarity to businesses operating in the state.
“We applaud the effort by California Democrats and Republicans to secure passage of the legislation to continue the state’s carbon market until 2030,” says Dirk Forrister, IETA’s CEO and President. “Business needs clear rules and predictability, and that is what the California state policymakers have provided.”
California’s cap-and-trade program began in 2012, covering large power and industrial facilities, before broadening coverage in 2015 to include transportation fuels and natural gas. Today, the program caps 85% of the state’s total emissions. In 2014, it linked with Québec’s market, and it is expected to link to Ontario’s new cap-and-trade program in 2018. Other jurisdictions, such as Oregon, Nova Scotia and Mexico, are eyeing a link as well.
“Now that we have clarity on California’s future direction, efforts to expand the reach of the linked market can ramp up,” says Katie Sullivan, Managing Director for IETA. “There is a great opportunity to build a market with sizeable impact – one which can lead to meaningful emissions reductions at a lower cost than if each jurisdiction acted alone.”
She adds: “IETA is ready to support the next wave of carbon markets in North America, and to help business uncover new opportunities in the low-carbon future.”