Amid Opposition, California Regulators Approve Major Changes To Cap-And-Trade Program | KQED

California’s cap-and-invest program limits emissions from major sources including oil refineries, steel and paper factories, cement plants, and other large polluters, with an annually declining cap targeting 40% below 1990 levels by 2030 and 85% below 1990 levels by 2045. CARB issues allowances per ton of greenhouse gases and sells them at auctions four times yearly. Auction revenue funds the California Greenhouse Gas Reduction Fund, which has collected over $31 billion since 2013. CARB’s January proposal to sharply reduce allowances was opposed by oil and gas leaders over potential consumer price increases amid market volatility. In April, CARB proposed the Manufacturing Decarbonization Incentive to return allowances if companies invest in decarbonization projects such as clean equipment replacements, carbon sequestration, and methane reduction. Climate, affordable housing, and transit advocates question whether projects will materialize and warn the program could reduce allowance auction value and GGRF funding.

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