California’s Cap-and-Trade Program

Announcing Exciting Changes to California’s Cap-and-Trade Program


Following up on the extension of climate change legislation, the California Assembly, state Senate, and Governor Brown have agreed to an aggressive and responsible cap-and-trade spending plan.

The ultimate goal of cap-and-trade is to reduce harmful greenhouse gas emissions. However, the funds that come from cap-and-trade auctions can also be useful for programs that help reduce the impact of climate change on the people of California, such as helping state residents obtain clean fuel vehicles, improving access to renewable energy, and supporting community greening projects such as park expansions.

During negotiations the Assembly pushed to ensure the spending level was prudent and that Californians in both rural and urban areas, and in underserved communities that are disproportionately impacted by air quality problems, will benefit most from these programs.

Some of the details of the agreement are:

  • Ongoing cap-and-trade funding for transit and housing programs that reduce greenhouse gas emissions;
  • $1.4 billion in one-time funds for the Legislature to allocate where most needed;
  • $900 million over the coming year to reduce the harm caused by greenhouse gas emissions; and
  • $500 million in reserve for the future due to the volatile nature of cap and trade revenues

Taken together with last year’s passage of SB 350, which mandates half the energy generated in California comes from renewable sources by 2030, and the recently passed SB 32, extending greenhouse gas reduction legislation, California continues to be a national and global leader in the fight against climate change.

For more about this issue, see this video produced by the Assembly Democratic Caucus.