Governor Newsom announces major step toward the linkage of California and Washington state Cap-and-Invest programs

NEW YORK — California Governor Gavin Newsom took a major step forward in linking California’s Cap-and-Invest program with Washington’s by announcing today at New York Climate Week that his office has completed the requirements for California and Washington to link their cap-and-invest markets.

“California and Washington are showing how states can join forces to drive investments in affordable clean energy and curb climate pollution,” said Fred Krupp, President of Environmental Defense Fund. “By scaling up proven and efficient pollution-cutting programs, states can deliver savings for families and businesses, while making a huge impact on our national emissions. More states should follow their lead.”

This announcement follows the signing of the linkage agreement by Washington, California and their partner Québec from this past June. Moving forward, the California Air Resources Board will complete a formal rulemaking to enable the California program to accept allowances from Washington, progressing toward the shared goal of launching joint auctions in 2027.

For over 10 years, California has worked in a linked carbon market with Québec to cut emissions, and with the addition of Washington state, this broader market will have even greater impacts. Since 2012, California's program has generated more than $36 billion in revenue for climate action. Washington passed their own Cap-and-Invest program in 2023, which has already generated over $3 billion for climate and community investments across the state. Modeling shows that linking California and Washington state’s Cap-and-Invest programs will cut an additional 45 million metric tons of climate pollution across the two states through 2045 — equal to the annual emissions from 12 coal plants.