California tables new cap-and-trade plan that jumps ahead of Quebec and Ontario

California jumps over Quebec with carbon plan

MONTREAL — California’s Senate proposed a new and more ambitious carbon credit cap-and-trade system this week, challenging Ontario and Quebec to do the same or get left behind.

Quebec and California have a linked carbon credit market that expires at the end of 2020. Ontario held its first carbon credit auction in March and intends to link to the California-Quebec system in 2018.

Both provinces, however, will need to adapt to California’s proposed reforms if they want to continue working with the state after 2020, said Jessica Green, professor of environmental studies at New York University.

“It’s a big change,” she said Wednesday in an interview about California’s new bill. “It’s a decisive statement that’s saying: ‘If you want to play with us, you have to play by our rules and those rules are getting stronger all the time.'”

The new California plan provides for an increase in the minimum price for one ton of carbon dioxide or equivalent greenhouse gas to US$20 and creates a ceiling of US$30. Every year the minimum price would increase by US$5 and the ceiling by US$10.

The current market price for a ton of carbon equivalent is US$13.50.

Carbon offsets would no longer be permitted in the new bill and companies that emit greenhouse gases would need to purchase new credits every year.

Moreover, the new plan eliminates the possibility of acquiring free carbon credits.

A cap-and-trade system for carbon credits allows companies to purchase the right to emit greenhouse gasses.

In Quebec, all businesses that emit 25,000 metric tons a year of carbon dioxide or its equivalent have to comply with the system, except fossil fuel companies, which are only scheduled to comply starting in 2018.

Quebec currently holds joint auctions with California every quarter and the province has delegated the administration of them to California’s regulator.

“It’s an identical system right now,” said Danny Cullenward, an energy economist and lawyer who advised the California Senate on the bill.

He said Quebec and Ontario will still be allowed to link to California’s new plan, but the provinces will have to match the minimum carbon credit price floor.

“If somebody wants to link to this new market they have to have a comparable minimum carbon price,” he said in an interview. “It would be a terrible idea if we set up an ambitious climate plan and we linked to a partner that was not all that ambitious.”

Gary Wheeler, spokesman for the Ontario Ministry of the Environment and Climate Change, said in an email that the proposal is one of several early drafts put forward by different California state senators.

“None have gone through the legislative process and there are significant discussions that need to happen before anything is finalized,” Wheeler said.

He said Ontario is committed to partnering with Quebec and California “and we will all be working together to determine the most responsible, effective way to keep lowering emissions in the next period after 2020.”

Representatives from the Quebec government did not respond to a request for comment Thursday.

If passed by California legislators, the new system would begin in January 2021, but there is no guarantee it will be adopted, Cullenward said.

“It’s too soon to tell, and (passing the bill) will be a significant lift, but there are positive signs,” he said.

Giuseppe Valiante, The Canadian Press

Canadian Press

Get local stories you won't find anywhere else right to your inbox.
Sign up here

Just Posted

Autism Awareness Day highlights challenges amid COVID-19

AutismBC regional coordinator in Kelowna discusses living with autism amid a pandemic

UPDATE: Good Samaritan delivers stolen sentimental mail

Some items stolen from boxes in the BX area were returned to the rightful owner

WATCH: Armstrong retirement community adapts amid COVID-19

Heaton Place rethinks programming to ensure residents stay safe, healthy and entertained

BREAKING: Inmate at Okanagan Correctional Centre tests positive for COVID-19

This is B.C.’s first community outbreak at a corrections facility

Answer your phone, Vernon school district says

No caller ID or unknown callers could be your child’s teacher reaching out

Trudeau rejects mandatory stay-at-home order for now; COVID deaths up

The virus has now infected more than 10,000 Canadians and cost 130 their lives

B.C. health care workers gain access to virtual health care options

During COVID-19 many clinics have closed, leaving health care workers with nowhere to turn

Tax collectors, auditors to help field ‘historic’ numbers of benefit-seeking callers

‘If you work for CRA, people think we are just there to take money from your pockets.’

Cowichan couple won’t self-isolate after returning from overseas

New law requires 14 days of self-isolation when returning to Canada

Family uses social media to help truckers find places to eat during pandemic

Restaurants Serving Drivers in Western Canada seeks to provide a list of places open for drivers

Advocates sound alarm over COVID-19 limiting access to contraceptives, abortion

The COVID-19 outbreak has hit sexual-health services from almost every angle

‘We’re working to help every Canadian’: Minister of Middle Class Prosperity

Minister Mona Fortier explains she is working with all levels of government amid COVID-19

Two planes come into close contact above Kelowna

The incident occurred between a WestJet flight and a private plane back in 2019

Most Read