In a highly anticipated move, the California Air Resources Board (CARB) has issued its draft regulations to implement the centerpiece of the state’s Global Warming Solutions Act (AB 32), a landmark cap-and-trade program for greenhouse gas (GHG) emissions. While there are other, smaller cap-and-trade programs in the United States, California’s proposal will cover approximately 85% of the state’s total GHG emissions and has the ambition to lead towards a national and international cap-and-trade program. The timing of CARB’s draft regulations comes at the heart of a contentious political debate regarding the potential benefits and economic costs of controlling GHG emissions through such a program, including a state ballot proposition to delay the implementation of the regulations. (CARB’s draft proposal can be found here (see article).)

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