Integrating equity and justice into a market-based framework
Are market-based mechanisms such as “cap-and-trade” and “cap-and-invest” a reliable solution to mitigating the harmful impacts of carbon emissions and the resultant devastating effects of climate change?
Cap-and-trade has been the choice strategy for governments around the globe for decades. Governing bodies have enforced “caps,” or maximum limits on the amounts of pollution, such as carbon emissions, that a company may produce. Companies can then “trade” emissions allowances, so those who pollute less can compensate for those who pollute more, or save the allowances for their own future use. How has this strategy fared? How does a cap-and-invest approach differ in principle and implementation from a cap-and-trade approach? And, how will the recent United States Supreme Court (SCOTUS) ruling, limiting the power of the U.S. Environmental Protection Agency (EPA) to regulate carbon dioxide emissions from existing power plants, affect these approaches?
Through an environmental justice lens, cap-and-trade programs have not historically been designed to redress the exploitation of certain communities, especially BIPOC communities. Has cap-and-trade successfully brought us closer to our global goals of reducing carbon emissions and mitigating the catastrophic effects of climate change? Or is there a better way forward?
Recently, Kathy Hochul, the governor of New York, announced an “ambitious” cap-and-invest program that will direct the revenue generated by caps on greenhouse emissions to disadvantaged communities. The program aims to balance the scales for communities that have historically endured the negative consequences of pollution and other environmental hazards created by various industries.
Could cap and invest be the new and improved strategy to achieve a greener and more equitable future?
We explored these questions and more during this convening where we brought two environmental justice thought leaders together to discuss this topic in greater detail. Vernice Miller-Travis, who leads on environmental justice initiatives at Metropolitan Group and who has dedicated her life to this cause, was in conversation with Jared Snyder, former deputy commissioner for climate, air and energy at the New York State Department of Environmental Conservation. Together they discussed the benefits and drawbacks of cap-and-trade and the potential of cap-and-invest as an alternative model and drew from decades of experience and expertise in the fields of environmental justice, climate mitigation, and federal and local policy implementation.