There’s big news from California this week as the state moves ahead on adopting a cap on carbon pollution. Despite federal inaction on the problem, the California Air Resources Board voted unanimously, 9 – 0, to endorse its cap-and-trade plan over alternative climate policies.
Advocates for the carbon cap have been plagued by the opposition’s lawsuits and legislative challenges (such as the AB32/Prop 23 referendum), but have again established the cap as one of the most efficient, cost-effective ways to move their pollution policy forward. The cap will eventually cover over 80% of the state’s carbon emissions.
Investors are expecting the policy to be in place soon. They’ve bet their money on it, in fact. Using futures contracts, two companies have conducted the first trade of carbon allowances for the California emissions trading scheme. The contract indicates the companies expect the allowances to trade at a price of $17.75 per ton of carbon pollution in December 2013.
Even just the expectation of this policy is stimulating the booming growth of clean energy investment. Since the U.S. patent office opened a new fast-track program for clean energy technologies last year, businesses have filed over 4,000 clean tech patents. The Clean Energy Patent Growth Index reports that the first quarter of 2011 had the second-highest growth in clean tech patents since they began keeping records, and California’s patent applications have skyrocketed to 600% of their levels in 2001.