States looking to create their own carbon markets should consider taking a page from Washington state, new research finds.
The reason? Washington’s cap-and-invest program provides financial incentives to oil refineries and other big businesses that can help them pay for decarbonization efforts — aiding the climate fight in the long run.
Washington state’s approach is “broadly applicable to any jurisdiction that’s thinking about carbon pricing,” said Drew Veysey, a senior associate with the Rocky Mountain Institute, which produced the report. “There are lessons for … lots of places, potentially, if they are interested in how you treat industry under carbon pricing.”
The Washington state system sets a yearly limit on greenhouse gas emissions and forces regulated businesses to buy state-issued pollution allowances, with each representing a ton of emissions. The state uses the revenue to find climate-focused projects.
