California, New Mexico and 10 U.S. Northeastern states may try to create a North American carbon market on their own now that President Barack Obama has given up on cap-and-trade legislation that stalled in Congress.
The emissions-trading system would be based on a planned carbon market in California, the most populous state, and an existing regional cap-and-trade program for power plants in the Northeast, according to state environmental officials. Three Canadian provinces have also shown interest in a cross-border carbon-trading system, the officials said.
“The key is to have as large and as liquid a market as possible,” John Yap, British Columbia’s climate-change minister, said in a telephone interview. Under cap-and-trade, the government creates a market for pollution rights by issuing a limited number of carbon-dioxide permits, which companies can buy and sell.
Of the six states in the Midwestern Greenhouse Gas Reduction Accord -- Iowa, Illinois, Kansas, Michigan, Minnesota and Wisconsin -- Democrats lost the governor’s race or control of the legislature to Republicans in five, according to data from the National Conference of State Legislatures. Many Republicans in national and state politics have opposed cap-and- trade, which they say is an energy tax in disguise.