“The program known as cap and trade sets a declining limit on total greenhouse gas emissions in the state from major polluters. Companies must reduce their emissions, buy allowances from the state or other businesses, or fund projects aimed at offsetting their pollution. Money the state receives from the sales funds climate-change mitigation, affordable housing and transportation projects, as well as utility bill credits for Californians.
It was set to expire after 2030. The law Newsom signed Friday at the Morrison Planetarium in San Francisco potentially boosts carbon-removal projects and requires the program to align with California’s target of achieving so-called carbon neutrality by 2045. That means the state will remove as many carbon emissions as it releases. The law changes the name to ‘cap and invest’ to emphasize that the money goes toward other programs.”
Launched in 2017 by the governors of Washington, New York, and California to help fill the void left by the U.S. federal government’s withdrawal from the Paris Agreement, the Alliance has grown to include 24 governors from across the U.S. representing approximately 60 percent of the U.S. economy and 55 percent of the U.S. population. Governors in the Alliance have pledged to collectively reduce net greenhouse gas emissions by at least 26-28 percent by 2025, 50-52 percent by 2030, and 61-66 percent by 2035, all below 2005 levels, and collectively achieve overall net-zero greenhouse gas emissions as soon as practicable, and no later than 2050.
The Alliance’s states and territories continue to advance innovative and impactful climate solutions to grow the economy, create jobs, and protect public health, and have a long record of action and results. In fact, the latest data shows that as of 2023, the Alliance has reduced its collective net greenhouse gas emissions by 24 percent below 2005 levels, while increasing collective GDP by 34 percent, and is on track to meet its near-term climate goal of reducing collective greenhouse gas emissions 26 percent below 2005 levels by 2025.
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