ISSAQUAH, Wash. — Some lawmakers across the country think the future of climate policy looks like this: A growing network of states forming a carbon market, forcing polluters to pay by the ton for the greenhouse gases they emit and reinvesting the revenues into clean energy and electrification projects.
Such programs, known as cap-and-trade, limit carbon emissions to a set amount that shrinks each year, and require businesses to bid at auctions for permits known as “allowances” for each ton they emit. Organizations may trade or sell those allowances with one another.
With an established program in California, a newly created system in Washington state and a plan in New York that’s still in development, cap-and-trade is poised to cover a quarter of the American economy.
But less than a year into cap-and-trade, Washington state is facing backlash over the program’s perceived contribution to high gas prices. A voter initiative that’s likely to be on the ballot next year, stoked by anger over prices at the pump, threatens to repeal it altogether.
The fight over the ballot initiative, regardless of whether it passes, could delay Washington’s plan to link its market with California’s. And leaders in New York, where state officials are still drawing up their own rules for cap-and-trade, say they’re watching Washington with concern. In other Northeastern states, which may follow New York, lawmakers are waiting for the dominoes to fall.
The future of cap-and-trade, some advocates say, may hinge on next year’s battle in Washington state.
“Why do you think I spent 80 hours a week on this?” said Washington state Sen. Joe Nguyễn, a Democrat who chairs the Senate Environment, Energy & Technology Committee. “This is the future of decarbonization. This has implications not just in Washington state, it has implications globally.”
Climate Commitment Act
Climate advocates credit Washington’s enactment of cap-and-trade in 2021 with reviving momentum for such programs. The state’s measure came 15 years after California passed its law, and just over a decade after President Barack Obama’s effort to create a federal program failed in Congress.
Washington lawmakers designed the Climate Commitment Act,