| Comment | California has shown leadership on climate change by creating a
price on carbon. But the program can still be improved in several
ways. The Petroleum Refining, Natural Gas Extraction, and Cement
sectors received over 49 million free allowances in 2016. At $12.73
per allowance, that subsidy is worth over $629 million per year.
Reducing or eliminating this subsidy would help bolster demand
which has been lagging in recent permit auctions. The California
Climate Credit that appears twice a year on electricity bills can
be turned into an off-bill per-capita dividend that would be
simple, transparent, and inclusive of disadvantaged communities.
The State can gain supporters for the program’s extension, by
moving the funding for environmental programs into the regular
budget process and returning Cap & Trade revenues back to people as
climate dividends.
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