April 25 (Bloomberg) -- California regulators backed a state plan to spend proceeds from carbon permit sales on energy efficiency, clean transportation and natural resources programs.
The state Air Resources Board voted today to support the proposal from the state Finance Department to invest the first three years of revenue from the allowance auctions on carbon-reducing projects including high-speed rail, zero-emissions vehicles, low-income housing retrofits and urban forestry.
California Governor Jerry Brown proposed last year using as much as $500 million a year in revenue from the carbon sales to pay for a high-speed rail project linking the state’s largest cities. The air board has so far generated $138 million from its first two allowance auctions and will hold one more on May 16 for this fiscal year, which ends June 30.
Brown is expected to release next month an updated budget for the 2013-2014 fiscal year, including proposals on how to spend the auction profits.
Under California’s carbon cap-and-trade program, the state is limiting emissions from power generators, oil refineries and other industrial plants, and cutting that limit gradually to reduce emissions to 1990 levels by 2020. The system will eventually cover 85 percent of the greenhouse gases released in the state.
The air board is issuing carbon allowances, each permitting the release of 1 metric ton, through a combination of free allocations and quarterly auctions. Companies must turn in carbon permits to cover their emissions, and those with more allowances than they need can sell or trade the excess.
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