California Carbon Allowance Market (CCA)
The CCA market launched in 2012, and now covers ~75% of the state’s GHG emissions. California joined the Western Climate Initiative (WCI) in 2007 and linked its program with Québec’s in January 2014.
Year in Review:
At the start of 2021, the CCA market incurred several changes, including the addition of a price ceiling, the inclusion of two allowance price containment reserve tiers below the price ceiling, reductions in the use of offset credits (i.e. credits from projects that do not adequately provide direct environmental benefits), and a steeper allowance cap that declines to 2030.1
In Jan. 2023, Washington will launch their cap-and-trade system, which will eventually connect to California and Quebec’s linked programs known as the Western Climate Initiative.2
*TNAC: total number of allowances in circulation, a term specific to the EU ETS but is a measure of the allowance surplus
- International Carbon Action Partnership, “USA - California Cap-and-Trade Program Factsheet,” retrieved 12/31/2022
- Department of Ecology, State of Washington, “Climate Commitment Act”, retrieved 2/8/2022/