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How Would Facility-Specific Emissions Caps Affect the California Carbon Market?

Author

Listed:
  • Burtraw, Dallas

    (Resources for the Future)

  • Roy, Nicholas

    (Resources for the Future)

Abstract

Incentive-based approaches to addressing air pollution, such as cap-and-trade, enable flexible compliance that can reduce costs compared with prescriptive regulations. Flexibility implies that emissions reductions happen where abatement costs are lowest, but that may not be where emissions reductions are needed to mitigate preexisting inequities in pollution exposure. This paper examines the California carbon market and finds that emissions from stationary sources in disadvantaged communities have fallen overall as quickly and often more quickly than the state average, but with notable outliers often in densely populated areas. This paper considers additional requirements on individual facilities to ensure an equitable rate of progress and finds they would likely have little effect on the allowance market.

Suggested Citation

  • Burtraw, Dallas & Roy, Nicholas, 2023. "How Would Facility-Specific Emissions Caps Affect the California Carbon Market?," RFF Reports 23-09, Resources for the Future.
    • Handle: RePEc:rff:report:rp-23-09
    as

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    File URL: https://www.rff.org/documents/4094/Report_23-09v3.pdf
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    References listed on IDEAS

    as
    1. Lara Cushing & Dan Blaustein-Rejto & Madeline Wander & Manuel Pastor & James Sadd & Allen Zhu & Rachel Morello-Frosch, 2018. "Carbon trading, co-pollutants, and environmental equity: Evidence from California’s cap-and-trade program (2011–2015)," PLOS Medicine, Public Library of Science, vol. 15(7), pages 1-20, July.
    2. repec:plo:pone00:0094431 is not listed on IDEAS
    3. Sanya Carley & David M. Konisky, 2020. "The justice and equity implications of the clean energy transition," Nature Energy, Nature, vol. 5(8), pages 569-577, August.
    4. Dallas Burtraw & Charles Holt & Karen Palmer & William Shobe, 2022. "Price-Responsive Allowance Supply in Emissions Markets," Journal of the Association of Environmental and Resource Economists, University of Chicago Press, vol. 9(5), pages 851-884.
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    Cited by:

    1. Roy, Nicholas & Russo, Suzanne & Burtraw, Dallas, 2025. "Considerations for Washington’s Linkage Negotiations with California and Québec," RFF Reports 25-05, Resources for the Future.

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