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California debuts landmark cap-and-trade system

Published: November 14, 2012 Comment on this article

CALIFORNIA PERMITTING: California has begun auctioning permits for greenhouse gas emissions, launching what is expected to be the world's second-largest carbon market.

photo - FILE - This March 9, 2010 file photo shows a tanker truck passing the Chevron oil refinery in Richmond, Calif. On Weds., Nov. 14, 2012, California’s largest greenhouse gas emitters will for the first time begin buying permits in a landmark “cap-and-trade” system meant to control emissions of heat-trapping gases and spur investment in clean technologies. The program is a key part of California’s 2006 climate-change law, AB32, a suite of regulations that dictate standards for cleaner-burning fuels, more efficient automobiles and increased use of renewable energy. (AP Photo/Paul Sakuma, File)

FILE - This March 9, 2010 file photo shows a tanker truck passing the Chevron oil refinery in Richmond, Calif. On Weds., Nov. 14, 2012, California’s largest greenhouse gas emitters will for the first time begin buying permits in a landmark “cap-and-trade” system meant to control emissions of heat-trapping gases and spur investment in clean technologies. The program is a key part of California’s 2006 climate-change law, AB32, a suite of regulations that dictate standards for cleaner-burning fuels, more efficient automobiles and increased use of renewable energy. (AP Photo/Paul Sakuma, File)

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CENTRAL PIECE: The plan is a central piece of the state's 2006 global warming law, a suite of regulations meant to dramatically reduce emissions of heat-trapping gases. Businesses must either cut emissions to cap levels or buy allowances from other companies for each extra ton of pollution discharged annually.

CHAMBER OPPOSITION: The auction occurred despite a last-minute lawsuit from the California Chamber of Commerce, which has argued the program should be invalidated as an illegal tax.