California will continue to monitor Washington state's nascent carbon market for the potential of future linkage and expects to have a "better idea" after its first year of operation, according to a top state regulator.
California will examine how well Washington's market is functioning and whether its behavior is "stable," to look at what impact it could have on California's program to incorporate another jurisdiction, California Air Resources Board (CARB) deputy executive officer of climate change and research Rajinder Sahota said today at the Argus Biofuels, LCFS and Carbon Markets Summit in Monterey, California.
CARB will need to examine a number of factors, including the stringency of Washington's efforts and many of the design elements of the program.
"We have to look at their offsets and does it meet the same criteria as ours?" Sahota said. "If not, we cannot include those in the program."
Sahota said she is bullish on the program's extension past 2030.
"We believe we have the authority to have the program post-2030, but it is so expansive that we expect and think the legislature will want to help shape that program, and we would be happy to have those discussions with them," she said.
CARB has not stipulated a timeline for inking the post-2030 extension but does have long-term targets out to 2045.
"The sooner you can embed and get the policy signals in statute, there is more certainty for investment beyond 2030," Sahota said. "We are trying to get both LCFS and cap and trade in 2024 as quickly as possible so our companies have the longest ramp possible to tighten that stringency to 2030."