Overview

• Lawmakers approved the reauthorization through 2045, rebranding the program as “cap and invest” and aiming to better align the declining emissions cap with state climate targets while expanding carbon-removal pathways.
• A companion bill locks in annual spending of auction proceeds, including $1 billion for high-speed rail, $800 million for affordable housing, $250 million for community air protection, and a $1 billion legislative set-aside.
• The package includes a measure allowing the state grid operator to join a western regional market, which the governor’s office says would bolster reliability and lower costs for ratepayers.
• To address fuel supply concerns, the legislation streamlines certain oil production permits in Kern County and adds tougher air monitoring and enforcement in highly impacted communities.
• The deal drew pushback from environmental justice advocates and Republicans over local air protections and costs, while supporters say it restores market certainty after an estimated $3.6 billion dip in auction revenue.