California to Raise Billions/Year from Cap-and-Trade

April 11th, 2012 by Zachary Shahan

California’s starting a state cap-and-trade system to help address global warming later this year. A new report from the state’s Legislative Analyst’s Office finds that the program could be raising up to $14 billion.

The money will be raised from CO2 pollution credits. Auctioning begins this fall and it’s expected that $1 billion to $3 billion will be raised in 2012 and 2013 as the program gets rolling.

Currently, the California state budget deficit is at $9 billion. However, even if the surplus from the cap-and-trade program is greater than the deficit, that doesn’t ensure that it will cut the deficit to zero, since the money raised from the program must be used for projects that are themselves related to cutting greenhouse gas emissions. Still, Governor Jerry Brown’s budget for the coming fiscal year includes $1 billion in revenue from the program, and a considerable amount of money from the program could go towards California’s ambitious high-speed rail plans.

California, under the Global Warming Solutions Act of 2006, has committed to cutting its greenhouse gas emissions 80% by 2050 (below 1990 levels).

Cap-and-trade, originally dreamt up by business interests and used legislatively by the George H.W. Bush administration starting in 1990 to stop acid rain, has been used by Europe and the Northeastern U.S. for years to cut global warming pollution. Programs have also now been implemented or approved in Australia, China, New Zealand, and other places.

The Northeastern U.S. cap-and-trade program under the Regional Greenhouse Gas Initiative (RGGI) has been hugely successful, as we’ve written many times here on CleanTechnica. In fact, the biggest problem related to the program has actually been the use of RGGI funds for general state purposes (such as reducing state deficits) rather for the clean energy and energy efficiency programs the money is supposed to go to. Hopefully, that doesn’t become an issue in California. Overall, though, RGGI has shown us that cap-and-trade cuts CO2 emissions, saves citizens money through improved energy efficiency, and creates jobs. California has a lot to look forward to!

Source: Yale Environment 360
Image: California flag via shutterstock

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Tags: California, california cap and trade, california Global Warming Solutions Act, Global Warming Solutions Act, RGGI

About the Author

Zachary Shahan spends most of his time here on CleanTechnica as the director/chief editor. Otherwise, he's probably enthusiastically fulfilling his duties as the director/editor of Solar Love, EV Obsession, Planetsave, or Bikocity. Zach is recognized globally as a solar energy, electric car, and wind energy expert. If you would like him to speak at a related conference or event, connect with him via social media. You can connect with Zach on any popular social networking site you like. Links to all of his main social media profiles are on ZacharyShahan.com.

http://pulse.yahoo.com/_6ERBGTORH5UCCG6CKMETJVON7Y David N

This California Cap and Trade plan won’t raise a dime of revenue. These taxes will just be the death warrant for California business. Those that can pass the cost along to the consumer will do so. Those that can’t will either go out of business or leave the state.

The net effect of this will make California less competitive. More unemployment, more job and taxpayer exodus.
- http://cleantechnica.com/ Zachary Shahan
  
  No previous experiences with C&T would lead one to believe that and i’ve seen no evidence that would be the odd case in CA.
  - http://pulse.yahoo.com/_6ERBGTORH5UCCG6CKMETJVON7Y David N
    
    The only previous experience we have with C&T is in Europe. And, frankly, that experience isn’t one to make one hopeful.
    - http://cleantechnica.com/ Zachary Shahan
      
      Not sure what you are talking about.
      
      We have C&T in the NE U.S. — highly successful.
      
      We had it implemented for Acid Rain — heard of acid rain lately?
      
      EU is so far ahead of its CO2 reduction targets that it is looking to increase them considerably. Anyone else cutting emissions as needed?
CharliePeters

Federal ethanol policy increases Government motors oil use and Big oil profit.

It is reported that today California is using Brazil sugar cane ethanol at $0.16 per gal ($8billion for Big oil) increase over using GMO corn fuel ethanol. In this game the cars and trucks get to pay and Big oil profits are the result, that may be ready for change.

Folks that pay more at the pump for less from Cars, trucks, food, water & air need better, it is time.

The car tax of AB 118 Nunez is just a simple Big oil welfare program, AAA questioned the policy and some folks still agree.

AB 523 is just a short put (waiver) from better results.