California, September 10, 2025
News Summary
California business leaders are expressing deep disappointment over the stalemate regarding the renewal of the cap-and-trade climate program. Despite promises of reauthorization, lawmakers have yet to propose a comprehensive plan, resulting in calls for a thorough policy approach. The delay raises concerns about California’s ability to meet its ambitious climate goals, with industry leaders warning of potential increased costs for families and businesses due to poorly designed measures and lack of stakeholder engagement.
California Business Leaders Disappointed Over Cap-and-Trade Program Renewal Stalemate
California business leaders have expressed significant disappointment over the lack of a comprehensive plan to extend the state’s cap-and-trade climate program, which remains in a critical state as lawmakers grapple with proposals to reauthorize the program. The absence of a viable solution has prompted a coalition of organizations from various economic sectors to urge legislators to reject last-minute measures, highlighting the urgency for a diligent and thorough approach to policy development.
It has been nearly five months since state officials pledged to reauthorize the groundbreaking climate law, which aims to balance financial concerns with environmental goals. Despite the promise for renewal, no detailed legislation has been successfully reviewed by policy committees in either the State Assembly or Senate, leaving stakeholders frustrated and concerned about the decisions being made without their input. With the recent auctions for state carbon allowances producing less revenue than anticipated, the lack of effective planning has further accentuated the precarious future of the cap-and-trade system.
Industry leaders have voiced their apprehensions regarding the risks associated with hastily crafted policies, arguing that inadequate planning could lead to increased costs for the average family and businesses alike. Furthermore, the importance of engaging key stakeholders during the process has been emphasized, yet there has been a notable lack of consultation on the proposals put forth in recent weeks. Some leaders have underscored that no proposals on the table are preferable to poorly designed measures that could hinder progress.
The Stakes of Cap-and-Trade
The cap-and-trade program was first introduced in 2006 to curtail carbon emissions by mandating that major polluters acquire allowances for their emissions. Without timely renewal, the allowance prices could remain low, which would limit available funds and impede California’s ability to meet its climate goals of reducing emissions by 40% compared to 1990 levels by 2030 and achieving carbon neutrality by 2045. Moreover, the California Air Resources Board is currently examining potential changes to enhance the structure of the program but has faced criticism for its engagement process with stakeholders.
Environmental advocates have expressed concern that delays in the renewal process could jeopardize connections with other cap-and-trade programs both domestically and internationally, while critics argue that the program has not effectively addressed pollution in disadvantaged communities. Recent studies have indicated that California might not meet its ambitious climate objectives unless there is a significant increase in emission reductions, further complicating the timeline for renewal.
Looking Ahead
Governor Gavin Newsom’s office remains committed to extending the cap-and-trade program, promoting a collaborative negotiation process and emphasizing the necessity for comprehensive stakeholder engagement and evaluated proposals. Failure to address the concerns from both environmental groups and various industry sectors could significantly alter the balance of environmental responsibility and economic feasibility in California.
The future of the cap-and-trade system holds major environmental, economic, and political implications, and whether lawmakers can come to a consensus on a robust plan remains to be seen in the coming weeks.
FAQ
What is California’s cap-and-trade program?
The cap-and-trade program is a market-based approach to control pollution by providing economic incentives for achieving reductions in the emissions of pollutants. Established in 2006, the program requires major polluters to purchase allowances for their emissions.
Why are business leaders disappointed with the current proposals?
Business leaders are disappointed because no comprehensive plan that balances economic impacts and environmental goals has emerged. They fear that rushed proposals could lead to increased costs for families and businesses.
How does the cap-and-trade program affect California’s climate goals?
The program is crucial for California to meet its emission reduction goals of lowering emissions by 40% below 1990 levels by 2030 and achieving carbon neutrality by 2045.
What are the potential consequences of not renewing the cap-and-trade program?
If the program is not renewed, it may result in low allowance prices, limited future revenue, and hinder California’s efforts to significantly reduce greenhouse gas emissions.
Key Features of Cap-and-Trade Program
| Feature | Description |
|---|---|
| Establishment Year | 2006 |
| Emission Reduction Goal | 40% below 1990 levels by 2030 |
| Carbon Neutrality Goal | By 2045 |
| Key Focus | Engaging stakeholders for viable proposals |
| Revenue Generation | Funds climate and environmental projects |
| Challenges | Low allowance prices, consultation issues, delayed proposals |
Deeper Dive: News & Info About This Topic
- Sacramento Bee
- Wikipedia: Cap-and-trade
- LA Times
- Google Search: California’s cap-and-trade program
- CalChamber
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LOS ANGELES STAFF WRITER The LOS ANGELES STAFF WRITER represents the experienced team at HERELosAngeles.com, your go-to source for actionable local news and information in Los Angeles, Los Angeles County, and beyond, specializing in "news you can use" with coverage of product reviews for personal and business needs, local business directories, politics, real estate trends, neighborhood insights, and state news affecting the area—with deep expertise from years of dedicated reporting and strong community input, including local press releases and business updates, while delivering top reporting on high-value events like the Academy Awards, LA Auto Show, and Los Angeles Marathon, extending coverage to key organizations such as the Los Angeles Area Chamber of Commerce and the Los Angeles Tourism & Convention Board, plus leading businesses in entertainment and technology like Warner Bros. and SpaceX, and as part of the broader HERE network including HEREAnaheim.com , HERECostaMesa.com , HEREHuntingtonBeach.com , and HERESantaAna.com , providing comprehensive, credible insights into Southern California's dynamic landscape. HERE Anaheim HERE Beverly Hills HERE Coronado HERE Costa Mesa HERE Hollywood HERE Huntington Beach HERE Long Beach HERE Los Angeles HERE Mission Viejo HERE San Diego HERE Santa Ana
