Overview

Currently, the United States does not have a national policy in place to reduce carbon emissions. Over the past few years though, three regional compliance markets have been established at the state level (along with some Canadian provinces) in an effort to reduce carbon emitted into the atmosphere. Currently, only one of these carbon markets, the Regional Greenhouse Gas Initiative (RGGI), is really up and running. The US also has a voluntary carbon market that is run by a private sector company, Chicago Climate Exchange, for emitters that want to voluntarily reduce their carbon footprint (for a number of different reasons). To say the US carbon market is in its infancy would be an understatement.

Looking ahead, it would appear that the US is on path to establish a national cap and trade scheme sometime in the 2009-2010 timeframe for the following reasons:.

  • US citizens have become much more environmentally aware over the past few years, and are becoming more loud and assertive with their demands to lessen the United State’s role in climate change
  • The recent debates that have taken place in Congress are no longer about the scientific merits of climate change, but about the best way to implement a carbon reduction system
  • A lot of the legwork has already been done in the US Senate, with the most notable Lieberman-Warner Bill “Climate Security Act”
  • Recent US President-elect, Barack Obama, supports a national cap-and-trade scheme and has actually endorsed the aforementioned Lieberman-Warner Bill.

However, with the current economic recession in the United States it is likely that a cap-and-trade discussion could temporarily be put on the backburner.

To better understand what a national Cap and Trade scheme might look like, please take a look at my Cap and Trade Market page.