SB 775 will provide consumer rebates, add financial stability to the system
Sacramento – State Senators Bob Wieckowski (D-Fremont) and Senate President pro Tempore Kevin de León today announced a new and improved Cap and Trade program to take effect in 2021 and maintain California’s global leadership in the fight against climate change.
SB 775, which will be heard in the Senate Environmental Quality Committee on May 10, eliminates some of the key weaknesses of the existing system and puts Cap and Trade on solid ground through 2030. The bill requires two-thirds support in the Legislature.
“SB 775 shows that we are listening carefully to those who have concerns about the current system and we are targeting those weak points to build a better, more predictable and more stable program to enable California to meet its greenhouse gas reduction goals and stay in the forefront on climate change issues,” said Wieckowski, chair of the Environmental Quality Committee. “This new, post-2020 program puts money back into consumers’ pockets through climate rebates, and includes a price floor and ceiling at quarterly auctions to eliminate the wild fluctuations we’ve experienced in the past. It puts a cap on the price of carbon and limits it by law. While others may be retreating on climate change, this bill is a clear statement that California will continue to lead the way on clean energy issues.”
SB 775 also creates an Economic Competitiveness Assurance Program to protect California manufacturers covered by Cap and Trade. It ensures that every business that sells carbon-intensive products in the state is treated fairly and competes on a level playing field.
“We’ve already decided as a Legislature and as a state that we want to dramatically reduce pollution and move toward a clean energy future,” De León said. “That debate is over. Now we’re deciding how we get there. And our best bet is to stay the course we’re on with some adjustments to make sure we protect consumers, keep the market stable and reach our targets.”
The existing Cap and Trade system is a rule adopted by state regulators to help reduce heat-trapping gases that cause global warming. Putting a price on carbon is seen by experts as key to reducing its production and driving investment and innovation into new, lower polluting technologies. Passing a new program beyond 2020 with two-thirds support would help insulate Cap and Trade from legal challenges.
SB 775 directs revenue to three newly created funds: California Climate Infrastructure Fund, California Climate and Clean Energy Research Fund, and the California Climate Dividend Fund. By simplifying carbon pricing, the post-2020 Cap and Trade program would be more easily replicated by other states or countries seeking to reduce their own greenhouse gas emissions.
Wieckowski chairs the Senate Environmental Quality Committee and served as a Senate delegate to the Paris Climate Conference.