Cap-and-Trade Program: Key Component of California's Path to Clean Energy under AB 32

Recognizing that California’s economic well-being, public health, and natural resources are threatened by climate change, the state Legislature passed Assembly Bill (AB 32) in 2006 to commit California to reducing greenhouse gas emissions to 1990 levels by 2020—roughly a 20 percent reduction. AB 32 directed the California Air Resources Board (ARB), a regulatory agency within the state’s Environmental Protection Agency, to develop a blueprint—known as the Scoping Plan—for achieving AB 32’s goal of reducing carbon pollution statewide. Released in 2008, the Scoping Plan lays out a comprehensive suite of direct emission reduction measures across all sectors of the economy, backed up by a hard cap to ensure compliance. California is on pace to meet AB 32’s reduction target, but policymakers must remain diligent as new measures come into effect and opponents step up their attacks, which aim to eliminate some AB 32 programs (such as the low carbon fuel standard) and weaken others (such as cap-and-trade).