{"id":23832,"date":"2024-01-25T15:26:41","date_gmt":"2024-01-25T20:26:41","guid":{"rendered":"https:\/\/blogs.edf.org\/climate411\/?p=23832"},"modified":"2025-12-02T16:34:52","modified_gmt":"2025-12-02T21:34:52","slug":"cut-carbon-raise-cash-how-new-yorks-cap-and-invest-program-could-invest-billions-in-communities","status":"publish","type":"post","link":"https:\/\/blogs.edf.org\/climate411\/2024\/01\/25\/cut-carbon-raise-cash-how-new-yorks-cap-and-invest-program-could-invest-billions-in-communities\/","title":{"rendered":"Cut carbon, raise cash: How New York\u2019s cap-and-invest program could invest billions in communities"},"content":{"rendered":"

In leading climate states, you\u2019ll find trailblazing projects that are benefiting people\u2019s lives and cutting costly pollution right now.<\/p>\n

In Washington, young people ride the ferry across Puget sound and buses around the state for free. In California, low-income residents get money-saving home energy efficiency upgrades at no cost. And in New York, businesses and apartments earn major rebates to install EV charging stations \u2014 with 4,000 stations installed so far.<\/p>\n

These are just a few projects supported by funding from cap-and-invest programs. While limiting and driving down harmful climate pollution, these programs are in turn raising revenue that is re-invested in communities.<\/p>\n

As New York develops the rules for its statewide cap-and-invest program \u2014 the third such program in the nation \u2014 a high-ambition program would give New Yorkers an exciting opportunity to shape and direct billions<\/span> of potential investments each year for communities.<\/strong> From improving public transportation access to lowering energy bills, the possibilities are endless.<\/p>\n

Here are just a few ways that other statewide programs, like California and Washington, are putting their revenues to work, and how New York\u2019s participation in the Regional Greenhouse Gas Initiative (RGGI) is already funding projects around the state \u2014 investments that could be significantly expanded and scaled up with a strong statewide cap-and-invest program.<\/p>\n

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First, let\u2019s talk about the \u201cinvest\u201d in cap-and-invest<\/h3>\n

Cap-and-invest programs, like the one being developed by Governor Hochul and state agency officials, are designed to cut carbon and raise cash<\/strong>. The pollution \u201ccap,\u201d also called a limit, determines the maximum allowable amount of climate pollution that can be emitted across the state each year, and it gets tighter over time to align with New York\u2019s climate goals. Major polluters regulated under the program have to hold \u201callowances\u201d to cover each ton of their emissions. The state auctions or distributes only as many allowances as add up to the total cap.<\/p>\n

The market for allowances puts a cost on pollution, meaning polluters are highly incentivized to emit less of it<\/strong>. As the pollution cap declines, allowances become more scarce and more expensive. Over time, the choice becomes clearer and clearer: deploying clean energy and other sustainability strategies to cut pollution makes the most business sense.<\/p>\n

In the meantime, the state raises cash from the sale of those emissions allowances that can be invested into a variety of projects that benefit New York communities<\/strong> \u2014 accelerating the transition to clean energy, reducing air pollution, protecting communities from natural disasters, ensuring affordable energy, and much more.<\/p>\n

Washington\u2019s cap-and-invest<\/h3>\n

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While Washington\u2019s cap-and-invest program just completed its first year of operation, it has already raised over $1.8 billion in revenue<\/strong> that will be invested into communities across the state to build climate resilience, improve air quality, create jobs, and more<\/a>. As in New York, at least 35% of these investments must benefit communities that are overburdened by air pollution and most vulnerable to climate impacts. Here are just a few ways Washington residents will benefit from these investments, which are beginning to roll out across the state:<\/p>\n