Including electricity imports in California’s cap-and-trade program: A case study of a border carbon adjustment in practice

This article examines the inclusion of electricity imports in California’s cap-and-trade program. Having struggled to prevent the circumvention of the compliance obligation for imported electricity, policymakers weakened the policy’s environmental effectiveness during implementation. Drawing on empirical data, this case study finds that political opposition from utilities led to this policy outcome. The reason behind this opposition lay in concerns about regulatory uncertainty and the policy’s effectiveness in achieving emissions reductions.