Washington State signed a linkage agreement on Thursday to combine its carbon market with the joint market operated by California and Quebec. The move is expected to stabilize allowance prices, lower costs for businesses, and reduce emissions across the three jurisdictions. Officials say the linked market should be operational by 2027, creating the world's largest sub-national carbon market. Washington's carbon market, established under the Climate Commitment Act, has raised nearly $5 billion since its first auction in 2023. Current allowance prices in Washington hover around $60 to $70 per ton, while California and Quebec's joint market prices are around $28 per ton. Linking the markets is expected to bring Washington's prices closer to that lower level, reducing costs passed on to consumers. Supporters and critics agree that linking will improve market stability and predictability. The state will continue to use auction revenue for greenhouse gas reduction projects and public health investments. The agreement still requires California and Quebec to adopt regulations before full implementation.
