As momentum behind federal climate change legislation builds in
Washington, D.C., the possibility of a cap-and-trade program for
greenhouse gases grows ever more likely.
On February 26, 2009, the Obama administration offered a clearer
view into its thinking on federal legislation on climate change
when it released an outline of its budget plan for Fiscal Year
2010. For the first time, the Office of Management and Budget (OMB)
placed a dollar value on the right to emit greenhouse gases, and
used this value as the basis for a $645.7 billion assumption about
a new and sustained source of government revenue generated from the
auctioning of carbon emissions allowances.
According to the Obama plan, the new emissions allowances will
be created under a federal, economy-wide, cap-and-trade system for
greenhouse gases modeled on the acid rain program launched
following the 1990 amendments to the Clean Air Act. Under the acid
rain program, most emissions allowances were
