CA Problem Solvers Release Cap-and-Trade Principles
FOR IMMEDIATE RELEASE
August 18, 2025
CONTACT: Nick Mirman
nick@cmpublicaffairs.com
SACRAMENTO - Members of California's bipartisan and bicameral Problem Solvers Caucus today released the caucus's four Cap-and-Trade principles, focused on lowering costs for consumers and promoting legislative oversight of program implementation.
As the Governor and Legislature consider reauthorizing the Cap-and-Trade program, the Problem Solvers Caucus believes that any proposal should prioritize affordability, comprehensive cost-analysis, robust oversight and participant certainty. These principles could be used as a roadmap to achieving bipartisan consensus:
Affordability: Free allowances and offset protocols ease cost pressures on food, fuel, utilities, building materials and other consumer needs. They also keep businesses and jobs in our state. A Cap-and-Trade extension should retain and enhance these features to protect consumers, jobs and the economy.
Comprehensive Cost Analysis: Executive agencies perform cost-benefit and economic analyses before adopting or modifying important policies. While crucial for identifying potential costs and consequences, these assessments aren’t always complete, timely, or transparent. A Cap-and-Trade extension should seek additional best practice standards and economic analysis reforms for climate portfolio policies to better illuminate tradeoffs, cumulative impacts, and the interplay with other rules and regulatory bodies.
Oversight: Reexamination of past policies is as important as prospective analysis. Prior rules may become irrelevant, need updates, or contain legacy costs that exceed current benefits. A Cap-and-Trade extension should pursue processes for the regular, rigorous legislative review of significant climate portfolio policies to assess their current necessity, performance, costs and impacts.
Certainty: Cap and Trade is the linchpin strategy for achieving California’s 2045 climate goals but key provisions sunset in less than five years. Uncertainty about the program’s future casts doubt among covered entities, investors, and communities – doubt that can deter investment and delay progress. A broad, bipartisan program extension through 2045 would send a strong signal that the state is committed to the program's longevity.
"A clean extension of California's Cap and Trade program isn't good enough - we need to make changes that reduce Californians' cost of living," said Assemblyman David Alvarez (D-San Diego), a Problem Solvers Caucus co-chair. "California's climate programs will not be effective if they're not exportable to other states and nations, or lower costs for consumers. We can do Cap and Trade and accomplish our climate goals in a way that attracts other governments to match our policies, but it must be cost effective."
“California’s climate policies should prioritize affordability and market principles while addressing environmental concerns," said Senator Suzette Martinez Valladares (R-Santa Clarita), a Problem Solvers Caucus co-chair. "A well-structured Cap-and-Trade program can drive innovation more cost-effectively than heavy mandates, but it must consider costs, jobs, and competitiveness while ensuring rigorous oversight and stable rules that encourage long-term investment.”
The California Problem Solvers Caucus has been focused on California's climate policies since its inception. It has held dozens of meetings over the years discussing the state's ongoing climate policies with climate experts, industry leaders, and academics. The Caucus will also be organizing a tour of a state-of-the-art clean California refinery to learn more about the clean fuels process and the challenges the industry faces.
This effort to make the Cap-and-Trade program more affordable for Californians falls in line with the Caucus's larger affordability push, including its bill to implement a cheaper, more environmentally-friendly fuel blend (AB 30).
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ABOUT THE CALIFORNIA PROBLEM SOLVERS CAUCUS: The California Problems Solvers Caucus was established in 2020, and seeks to find solutions reached through collaboration, not division; mutual respect, not partisan bickering; and will work in service to the people of California. The caucus is made up of both Assemblymembers and Senators, Democrat and Republican.
Problem Solvers are principled, pragmatic and committed to putting people over party. Learn more at www.caproblemsolversfoundation.com.