The California Air Resources Board (CARB) has set Jan. 1, 2014, as the date to officially link the state's cap-and-trade program with that of the Canadian Province of Quebec.
California and Quebec have worked together over the past four years to develop their respective cap-and-trade programs to provide for potential linkage. According to CARB, the linkage agreement provides an opportunity to closely monitor and fine-tune these first two programs, setting the stage for similar arrangements with other jurisdictions that are committed to reducing greenhouse gases (GHGs).
Under the agreement, each jurisdiction will accept the other's carbon allowances and approved offsets for compliance under their respective cap-and-trade program. The two jurisdictions will share the Compliance Instrument Tracking System Service for tracking allowances and approved offsets. Both California and Quebec will be supported by WCI Inc. for basic administrative functions, but maintain control over their respective programs.
CARB says this agreement expands the environmental impact of California's GHG-reduction effort, provides a larger pool of available allowances and approved offsets, and offers additional opportunities for investment in the carbon market.
‘The board's action today broadens the environmental impact of California's cap-and-trade program and helps fight climate change by reducing greenhouse gases,’ says CARB Chairman Mary D. Nichols. ‘California retains absolute control over its own program, and the larger carbon market overall provides additional options for California businesses."
No date is yet set for the first California-Quebec joint auction.