The two large pricing schemes currently in force in the U.S. include California’s cap and trade system and the Regional Greenhouse Gas Initiative (RGGI) – a cap and trade system on power plants across nine northeastern and mid-Atlantic U.S. states. California’s cap and trade is a key element for them to reach their emission reduction goals. Washington state’s Clean Air Rule, September, 2016, instituted what is essentially cap and trade on large stationary emission sources, but it is currently in litigation.
Several states currently have some sort of carbon pricing proposal and/or have some sort of push underway. Proposed legislation for some form of price on carbon is accelerating quickly, with a plethora of legislative proposals in 2018-19 with many moving pieces. Overall cap and trade is growing, but carbon tax seems to be a hard sell.
Northeastern and Mid-Atlantic U.S.
Carbon pricing policies are existing or being considered in . The New England efforts are loosely coordinated by the National Caucus of Environmental Legislators (NCEL).
The Regional Greenhouse Gas Initiative (RGGI) is a cap and trade system on power plants for nine northeastern states. RGGI’s cap was initially set too high (2009) but was later readjusted and to date RGGI is functioning well. New Jersey and possibly Virginia may also soon join RGGI. Pennsylvania is going a different route, filing a petition calling for formation of a cap and trade system modeled on California.
The Transportation and Climate Initiative (TCI) is a consortium of twelve states and the District of Columbia. At the end of 2018, nine of the states agreed to develop a framework that caps the region’s overall transportation emissions and trades in a system modeled after RGGI.
For more information on New England and Mid-Atlantic states, click on these links: Connecticut, Delaware, Maine, Maryland, Massachusetts, New Hampshire, New Jersey, New York, Pennsylvania, Rhode Island, Vermont, Virginia, Washington D.C.
The first (and only) midwestern state to propose carbon pricing (so far) is Minnesota, with legislation introduced May 2018.
The three Pacific Coast states of California, Oregon and Washington have or are considering carbon pricing. California has cap and trade and is in a trading market with Quebec, governed by the Western Climate Initiative (WCI). There is the possibility that Oregon and Washington could join the WCI if cap and trade is approved. Utah entered the fray in 2017 with a proposal for a carbon tax. Colorado, Montana and New Mexico are making approaches to the problem and Hawaii proposed a modest carbon tax in 2018.
For a compilation of climate change legislation passed by states see the Digital Environmental Legislative Handbook. For an excellent summary and updates on carbon pricing legislation see state information on the NCEL website.
Last updated January 29, 2019