California adopts historic cap-and-trade regulations
The California Air Resources Board, after three years of contentious debate, on Thursday approved the nation's first state-run cap-and-trade program, which will for the first time put a price on carbon emissions.
The unanimous vote paves the way for the carbon trading market, which begins in 2013 and will eventually require 85% of the state's largest polluters to either emit less carbon or purchase credits on a market that the air board will regulate.
The market is projected to exchange about $10 billion in carbon allowances by 2016, which would make it second largest in the world behind the European Union.
The program is part of AB 23, the state's 2006 climate change law that mandates a reduction in greenhouse gas emissions to 1990 levels by 2020.
Said board Chairwoman Mary Nichols: "We've done something important."
Photo: Valero Energy's Wilmington refinery in a 2010 photo. Credit: Christina House / Los Angeles Times