CA Cap-and-Trade: It’s Official

Breaking news: the much-discussed greenhouse gas regulation known as “cap-and-trade” has arrived in the US. Chem.Info online reports that California will now require its biggest greenhouse gas offenders/emitters to start purchasing permits for emissions.

Then, the cap, or number of allowances, will decline over time in an effort to drastically reduce greenhouse gas emissions by 2050.

Almost $1 billion. Roughly 39.5 million allowances are being pre-sold Nov. 14 for 2015 emissions. Roughly 23 million allowances will be sold for 2013 emissions.

The California Air Resources Board or ARB has estimated that businesses will pay a total of $964 million for allowances in fiscal year 2012-2013.

CA cap-and-trade  The program addresses refineries, power plants, industrial facilities and transportation fuels. The regulation includes an enforceable GHG cap that will decline over time, reports the AP. California’s ARB will distribute allowances, which are tradable permits, equal to the emission allowed under the cap. The ARB will monitor the program as well.

This “cap-and-trade” system is designed to do four things:

  1. control emissions of heat-trapping gases
  2. spur investment in clean technologies
  3. show that cap-and-trade can be done in the world’s ninth-largest economy
  4. provide a blueprint for other governments, nations and (inevitably) US states to follow

For the first two years of the program, large industrial emitters will receive 90% of their allowances for free. The gentle start hopes to give companies time to reduce emissions through new technologies or software-driven analysis and process improvements or other means.

Environmental laws seem to start in California and trickle eastward.  (Remember how people used to smoke cigarettes in New York City?)  So mind the cap

About Kal

Kal Kawar, CIH, PE, has a bachelor's in chemical engineering and a master's in industrial hygiene. His professional experience includes serving as staff industrial hygienist for IBM's New York semiconductor manufacturing facility, and as industrial hygienist for IBM’s US headquarters. Now executive vice president of Actio, Kal taps more than 20 years' worth of chemical engineering, industrial hygiene, and environmental engineering experience. His far-reaching expertise with global regulatory challenges created by EPA, TSCA, REACH, RoHS, WEEE – and hundreds of others – aid in developing Actio software solutions for MSDS management, raw material disclosure compliance, and product stewardship in a supply chain.
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