California is moving to link its cap-and-invest market with Washington’s, Gov. Gavin Newsom announced. The governor’s office estimates the change could provide $10 billion in electricity-bill credits and generate $8 billion for the state climate fund through 2030.
Newsom’s action allows the California Air Resources Board to begin the public process; he also published formal findings on Washington’s market, as required by state law. The states aim to hold their first joint auctions in 2027, expanding the California-Quebec market linked in 2014. The link would let companies use or sell Washington-generated pollution allowances. A Greenline Insights model cited by the Environmental Defense Fund projects 45 million metric tons of additional climate pollution cuts through 2045, equal to the annual emissions of 12 coal plants.
The Environmental Defense Fund praised the proposal. The Western States Petroleum Association said it supports well-designed market-based emissions cuts but urged caution, calling for analysis of effects on jobs, fuel costs and both states’ economies given differences in program designs, allowance inventories and market conditions.
