California has become the first state in the US to adopt a state-administered cap-and-trade program, LA Times reports. Yesterday, the California Air Resources Board voted unanimously for the carbon pricing scheme.
The plan, part of the state's climate change law AB32 mandating carbon emissions be reduced to 1990 levels by 2020, covers 85% of California's source of carbon emissions. Starting in 2013 polluters will have to either reduce emissions to the cap level or buy emission credits for the excess.
As for the impact on the rest of the nation, LA Times quotes Gary Gero of Climate Action Reserve:
If California gets it right, others will see it's possible to regulate greenhouse gas emissions while protecting its economy and while fostering a new green economy and industry. People watch what California does and do emulate it. Future cap-and-trade programs are going to pick up a lot of the design features we are implementing here. You'll see regional programs develop. They will put pressure on the federal government. It will send out ripples around the country.
We'll see about that last part...
Though the California program may be the first state-administered cap-and-trade program, regional carbon trading schemes have existed for a while, and carbon taxes have been passed in various parts of the nation at the city and county level.