EU and California to step up cooperation on carbon markets

At the Global Climate Action Summit in San Francisco today, European Climate Action and Energy Commissioner Miguel Arias Cañete and California Governor Jerry Brown agreed to strengthen bilateral cooperation on carbon markets.

Commissioner Arias Cañete and Governor Brown issued the following press announcement:

"Climate change is impacting our world today more than ever. We need more action and joint efforts, notably through carbon pricing, to meet this global threat. We, the EU and California, are both dedicated to working together to identify practical paths to decarbonize the world and deliver on the Paris goals.

The EU and California have a successful track record of technical exchange and mutual support to date on climate action and carbon markets. Today, Commissioner Miguel Arias Cañete and Governor Jerry Brown renewed and deepened their joint commitment and confirmed their view that greater alignment of carbon markets is in the interests of both. Aligning carbon markets could maximize and leverage climate action for economic transformation while ensuring real progress on reducing greenhouse gas emissions. In addition, Commissioner Miguel Arias Cañete and Governor Jerry Brown emphasized the need to engage other jurisdictions with similar and emerging programs to foster broader dialogue.

Over the next twelve months, officials from the EU and California will step up the frequency of exchanges, including on principles for alignment and the role of carbon pricing in:

• Sending near- and long-term investment signals for transformative technologies
• Addressing economic competitiveness
• Maximizing public benefits of use of programme revenues.

They also agreed to review, assess, and report on progress in these exchanges in twelve months.

The European Commission and California will work through the Florence Process, which brings together representatives of the key jurisdictions, including China, Canada, New Zealand, and others, to address issues of common interest. The Florence Process provides a venue for open dialogue and information exchange.'

Commissioner Arias Cañete emphasised that:

“Today we show that we are dedicated to remaining at the forefront of global action on climate change and the transition to a low-carbon economy. We will work closely together on carbon markets to contribute to the ambitious goals of the Paris Agreement. The experience of the EU and California can help identify opportunities and enable higher ambition. We are dedicated to working closely together, but also with others who are similarly committed to implementing cap and trade, in particular through the Florence Dialogue."

Governor Brown stressed that:

"To avoid climate catastrophe California and the EU must collaborate even more closely on carbon pricing — and all other climate actions."

Background

The EU emissions trading system (ETS) covers some 45% of EU greenhouse gas emissions in some 31 countries, has been in operation since 2005, and is set to deliver a reduction of 43% in EU emissions from the sectors covered by 2030.

The California ETS covers some 85% of California emissions and is linked to the ETS of Quebec. The linked California and Quebec ETS is the only economy-wide ETS in the Americas.

The Florence Process brings together representatives of the key jurisdictions with emissions trading programs from the EU, China, California, Quebec and New Zealand, to address issues of common concern and interest.

Some 88 countries are planning to use carbon pricing to meet their Paris goals, with 25 jurisdictions implementing cap and trade programs and 51 carbon pricing initiatives scheduled for implementation.