EXPLAINER | Cap-and-trade
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Cap-and-trade

Cap-and-trade is a market-based way to reduce pollution. It was first used successfully in the U.S. in the 1990’s, under former President George H.W. Bush to reduce sulfur dioxide, which causes acid rain.
Around the world,  more than 40 governments, in an effort to combat climate change, have put some sort of price on carbon—either by directly taxing fossil fuels, implementing cap-and-trade, or doing both. In the U.S., cap-and-trade systems are in place in California, and in the Northeast.

Pennsylvania is currently studying a citizen-led petition to implement an economy wide cap-and-trade system, modeled on California’s.

Here’s a brief explainer:

Latest stories


Pollution coming from a coal burning power plant.

Wolf’s cap-and-trade proposal takes a step forward

The Democratic governor issued an executive order declaring Pennsylvania would join a regional agreement aimed at reducing greenhouse gas emissions. Not everyone is on board.

By Katie Meyer

Rush-hour traffic heads west, right, and east, left, along the Schuylkill Expressway Wednesday, April 10, 2019 in Philadelphia.

Public input sought for potential region-wide transportation emissions cap-and-invest program

Pennsylvania may soon join a regional program meant to limit greenhouse gas emissions and increase investments in green transportation.

By Kathleen Davis/WESA

The Bruce Mansfield Power Plant burns coal to generate electricity in Beaver County.
Updated: November 19, 2019 | 6:52 pm

Lawmakers, criticizing Wolf’s executive order on joining cap-and-trade program, say it’s their call to make

Proposed bill would require Legislature to OK Pennsylvania becoming part of Regional Greenhouse Gas Initiative
By Scott Blanchard

FirstEnergy's Bruce Mansfield Power Plant in Shippingport, Pa.

Lawmaker: Proposal for Pa. cap-and-trade system to cut carbon emissions is ‘a beginning’

The bill would allow Pennsylvania to set its own cap, or negotiate with a group of other states in a regional program.

By Dana Bate/WHYY

The York 2 Energy Center in Peach Bottom Township, York County is an 828 megawatt natural gas-fired power plant co-located with the 565 megawatt York Energy Center.

PJM, nation’s largest power grid operator, grapples with carbon pricing as states diverge on climate policies

The organization is trying to walk a fine line between respecting states’ rights while figuring out how to incorporate diverse climate polices into its wholesale electricity market.

By Marie Cusick

Pennsylvania's efforts to comply with the federal plan to curb power-plant emissions could be delayed by an amended fiscal code, critics say

What is cap-and-trade?

By Marie Cusick

Talen Energy's Brunner Island plant in York County.

Citizen climate petition advances, after state board approves further study of cap-and-trade program

The ramifications of the petition could be politically significant– allowing significant climate policy to be implemented without new legislation.

By Marie Cusick

This photo taken May 5, 2014 shows the stacks of the Homer City Generating Station in Homer City, Pa. Three years ago, the operators of one of the nation’s dirtiest coal-fired power plants warned of “immediate and devastating” consequences from the Obama administration’s push to clean up pollution from coal. Faced with cutting sulfur dioxide pollution blowing into downwind states by 80 percent in less than a year, lawyers for EME Homer City Generation L.P. sued the Environmental Protection Agency to block the rule, saying it would cause a painful spike in electricity bills and grave harm to power producers like itself.

Climate petition calls on Pennsylvania to cut emissions through cap-and-trade system

Dozens of groups including environmental organizations, legal scholars, churches, and local governments argue Pennsylvania has the legal authority and constitutional duty to act on climate change.

By Marie Cusick