Northeast states' cap-and-trade system makes gains against climate change

Businesses potentially make money by cutting their pollution and selling off their permits, while businesses that continue to pollute must pay more for their pollution.
By Mark Schwartz | Aug 29, 2017
Nine northeastern statesfive of whom are headed by Republican governorsconfirmed Wednesday that they have cut carbon-dioxide emissions by 40% since 2008 under their interstate "cap-and-trade" program, the Regional Greenhouse Gas Initiative (RGGI). The states also announced a follow-up goal of reducing emissions 30% more by 2030.
"It's a major victory for the region, given the fact that it has all nine states on board, five of which are Republican governors," Jackson Morris, the Natural Resources Defense Council's director of Eastern energy, told the Huffington Post. "You couch all that in the lens of the Trump federal situation, and it's a major victory today for acting on climate."
The nine states in the RGGIConnecticut, Delaware, Maine, Maryland, Massachusetts, New Hampshire, New York, Rhode Island and Vermontbrought their total carbon-dioxide emissions down from 110 million tons in 2008 to 79.2 million tons in 2016. They committed this week to cap emissions at 75 million in 2021 and reduce them by another 2.25 million a year over the following decade.
Cap-and-trade is a system by which the government sets a limit on pollution emissions and fines businesses if they run over it. However, it also lets the businesses by and sell "permits," which allow the businesses that buy them to pollute more up to a certain amount.
Businesses potentially make money by cutting their pollution and selling off their permits, while businesses that continue to pollute must pay more for their pollution. The government prints more permits if the prices of permits get too high and threaten to spike consumer electricity prices.
California has its own state cap-and-trade program, but RGGI is the only interstate program in the country.

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