The program's quarterly auctions of emissions allowances have gone on largely without a hitch. The program has fit in, as was expected, with other emissions reduction programs implemented under AB 32, the state's landmark greenhouse gas legislation, including mandates for renewable fuels sources for electrical utilities and emissions standards for new cars and trucks.
It has done so without a measurable drag on economic growth. The program generated $969 million in revenue for the state through the end of 2014, and is expected to generate $2 billion a year or more in the future. The money must be spent on efforts to reduce carbon emissions.
"What we've learned is that a cap-and-trade system will not kill the California economy," says Stanford economist Lawrence H. Goulder, who advised the ARB on the program's design. "The economy has continued to flourish."
