Cap-and-Trade Extension: Issues for Legislative Oversight

The cap‑and‑trade program is one of the state’s key policies intended to reduce statewide greenhouse gas (GHG) emissions. Recently, the Legislature extended the state’s cap‑and‑trade program from 2020 to 2030 with the passage of Chapter 135 of 2017 (AB 398, E. Garcia). In this report, we (1) provide background information on cap‑and‑trade and the recent extension of the program to 2030, (2) identify key administrative implementation decisions that could affect program outcomes and the need for legislative oversight, (3) identify potential opportunities to increase the effectiveness of a new advisory committee created by AB 398, and (4) describe potential state cap‑and‑trade revenue scenarios through 2030.