California, a leader in efforts to combat climate change, has become the first US state to implement cap-and-trade to regulate greenhouse gas emissions. The system will place a price tag on carbon emissions and allow the state’s industries to trade carbon credits. The system will provide financial incentives to companies in order to curb greenhouse-gas emissions. The cap-and-trade program is scheduled to start in 2013 and it aims to slash emissions to 1990 levels by 2020.
The first part of the plan will include a cap on emissions, allowing businesses to sell their excesses to companies exceeding their carbon allowances. Companies included in the plan will have to pay 10 percent of their initial credits, but they will be able to purchase carbon offsets in order to comply with the eight percent of annual emission obligations.
The plan should drive a a surge of investment in clean energy technology. The system will also force companies to innovate in order to stay competitive.
This is great news for the renewable energy sector. According to research group Next 10’s latest edition of the “Many Shades of Green” report, green job growth in California outpaces the overall economy by three times the rate of overall job growth. The new regulations are sure to add to the core green economy in California.
© 2011, Richard Matthews. All rights reserved.
The Success of RGGI Carbon Trading Shows Cap-and-Trade Works
Republican Gubernatorial Gains and US Carbon Trading Programs
Cap-and-Trade Legislation Faces Opposition
US Cap-and-Trade: What and Why
US Cap-and-Trade: Solutions
US Cap-and-Trade: Positioning Your Business
US Cap-and-Trade Implications for Business
Small Business Can Save Cap-and-Trade
Small Business’ Silence on US Cap-and-trade Legislation
Helping Small Business Accept US Cap-and-Trade
Cap-and-trade in Ontario and Quebec