November marks a big date. It’s not just about a presidential election. It’s also about the kick off to California’s cap-and-trade system to limit carbon emissions.
The Golden State, in fact, will be operating what will become the world’s second largest cap-and-trade program, next to the one run in Europe. It is also getting established at a time when similar congressional attempts to curb greenhouse gas emissions have come to a screeching halt. So, why now and what does it portend for any American revival of such a movement?
“To be successful over the long-term, this program is going to have to deliver demonstrable benefits for Californians — benefits that we (not only) can see in terms of the environment and air quality, but also benefits that we can see in terms of economic development, job creation, cleaner energy and transportation infrastructure,” says Mary Nichols, chair of the California Air Resources Board.
The state will start its program in January 2013 but in November 2012, it will begin auctioning the credits — a pursuit expected to raise $1 billion. At first, 90 percent of those allowances will be given to participants and 10 percent must be purchased. By 2016, the program is expected to be in full force, and a $10 billion market. About 600 industrial facilities will be affected: cement companies, oil refineries and electric power generators.