A 'Brand New, Improved' Cap-and-Trade System for California

A California state senator has proposed to overhaul California’s cap-and-trade system explains the changes he wants to see.

2 minute read

May 26, 2017, 7:00 AM PDT

By Elana Eden


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California successfully defended its cap-and-trade program from a recent legal challenge, but it still has to wrestle with what will happen when the program expires in 2020—especially since the state emissions reduction target extends to 2030.

One proposal, from Senator Bob Wieckowski, is to essentially replace the current system with a new version of cap and trade that would change both how carbon is priced and how the revenues are spent. In The Planning Report, Wieckowski describes the three broad categories of investment his plan would create: climate research, infrastructure adaptation, and a new consumer program called "climate dividends."

"When we set a cap, there is necessarily going to be an increase in the price of gasoline and carbon-based products," he explains. "The idea is to return some of the money generated to the consumer, to ease the increased direct costs that we anticipate."

He also wants to see the state's investment in infrastructure shift to prioritize the upgrade or even relocation of basic facilities like sewers and roads, especially in disadvantaged communities.

Some of these facilities are located in areas that are endangered by sea-level rise and climate change. As we rebuild them, it may not be possible to simply fortify the surrounding ground. They may actually have to be moved to, for lack of a better term, higher ground. That’s quite a change from how we’re using cap-and-trade funds right now.

New technologies and innovations, meanwhile, would be explored through a third bucket of money dedicated to researching best climate adaptation practices. That approach speaks to Wieckowski's broader vision of where California fits into the global effort toward resilience.

"California's forte is the export of problem-solving ideas and devices that can help out the rest of the world," he says. Especially in light of the Trump administration's "disinterest" in climate action, he says, "People are looking for answers from us. How California goes, the world wants to go."

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