Examining California And Quebec's Cap-And-Trade Systems

In our latest blog piece covering Ontario's planned adoption of a cap-and-trade system that will be linked with the existing systems in Quebec and California, we described some of the major recent developments in Ontario and the United States to help put the province's cap-and-trade efforts in context. These developments include: the successful implementation of legislation and market mechanisms to curb sulfur dioxide and nitrogen oxide emissions in the 1990s and early 2000s, the development of the Western Climate Initiative, the signing of a Memorandum of Understanding with respect to a provincial and territorial cap-and-trade initiative between Ontario and Quebec, and the introduction of enabling cap-and-trade legislation in Ontario. In this piece, we illustrate the key elements of Quebec and California's linked cap-and-trade regime with a view towards anticipating how Ontario may choose to design its system over the coming months.