Washington State enacts cap-and-trade and clean fuels legislation

2021-05-04

In an historic move, the Washington State Legislature passed two major pieces of climate change legislation in the closing days of its recent session over the weekend of April 24-25, 2021.

Once signed by Governor Inslee, the Climate Commitment Act creates a market-based, economy-wide, cap-and-trade program. The other legislation (HB 1091) creates a program to reduce the carbon in transportation fuels.1 These bills follow on the heels of the 2019 Clean Energy Transformation Act (CETA), which requires that the electric generating sector be completely decarbonized by 2045.

Together, these three laws place Washington firmly in the top tier of states addressing climate change. They also strengthen the policy alignment along the West Coast by opening the door to linkage with California’s cap-and-trade program and adopting a clean fuels program similar to that of British Columbia, Oregon, and California.

Big Picture

As shown below, Washington State currently emits roughly 100 million metric tons of anthropogenic greenhouse gases (GHGs) annually. Consistent with the Paris Agreement and what the science says is necessary to avoid a global temperature increase greater than 1.5 degrees C, Washington’s legislature in 2020 committed to achieving net-zero GHG emissions by 2050.

To achieve this, the legislature established interim GHG emission limitations of 50 million tons by 2030, 27 million tons by 2040, and five million tons by 2050 (with the remaining five million tons of emissions to be offset by an equal amount of GHG capture and sequestration).2 In combination with CETA, the two new bills are designed to meet these ambitious goals.

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JS Supra, 4 April 2021
; https://www.jdsupra.com/legalnews/washington-state-enacts-cap-and-trade-9618890/