Washington state is finalizing plans to link its Cap-and-Invest program with California and Quebec's carbon markets, creating the largest subnational emissions trading system in North America. The Washington Department of Ecology proposed regulatory amendments on June 1 to align compliance deadlines, auction procedures, and technical rules across the three jurisdictions. If approved, the shared market would launch in 2027, allowing carbon allowances from any participating region to be used across the combined system with joint auctions and a single allowance price. A linked market could reduce allowance price volatility and lower compliance costs for Washington's covered entities, according to modeling from Resources for the Future. State officials also suggest that a larger, more stable market may reduce the likelihood of compliance costs being passed to consumers, potentially lowering prices at the gas pump. The linkage review includes an Environmental Justice Assessment to ensure at least 35% of auction revenues continue flowing to vulnerable communities under Washington's Climate Commitment Act.
