California announces details of new ETS
The California Air Resources Board (ARB) has released the details of the greenhouse gas emissions trading scheme which is due to begin operating in California from 2012 onwards, aimed at reducing emissions to 1990 levels by 2020. The cap and trade program will apply to the state's 500 largest emissions.
However, citing the poor state of the Californian economy, the ARB announced that almost all permits will initially be provided to companies for free, rather than being sold at auction. Certain industries will be provided with all of their permits for free until 2020, including the oil and cement industries.
Despite claiming the economic situation as a justification for weakening the scheme, the ARB has argued that the law will drive innovation and green job growth. The plan is estimated to cost just 0.1 per cent of annual GDP growth. In addition, the relatively poor economic situation in California means that the goal of reducing emissions to 1990 levels by 2020 is less ambitious than when originally proposed.
At time of press, the scheme was due to be adopted in final form by the ARB on December 16.
More information: Air Resources Board