Not too long ago, the state of Washington launched into an formidable new plan to fight local weather change. Taking a web page from economics textbooks, the state instituted a statewide “cap and commerce” system for carbon emissions. The state establishes a cap on the whole quantity of carbon air pollution it’s prepared to permit annually, after which offers away or auctions off carbon emission permits that add as much as that whole. Firms can then commerce these permits on the open market.
Economists love cap and commerce plans as a result of they set up a restrict on carbon emissions whereas letting the market discover essentially the most environment friendly approach for decarbonization to happen. However cap and commerce has had a tough time catching on, particularly within the U.S.
The stakes are excessive for Washington’s new plan. If it succeeds, it might persuade different states to implement their very own variations, but when it fails, it would function a cautionary story. On right this moment’s present, we check out how Washington’s grand experiment with cap and commerce is faring.
This episode was hosted by Keith Romer and Kenny Malone. It was produced by Emma Peaslee and edited by Emily Siner. It was truth checked by Sierra Juarez and engineered by Valentina Rodriguez Sanchez. Alex Goldmark is Planet Cash‘s government producer.
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