New York Delays Climate Action as Western States Merge Cap-and-Trade Programs

California and Washington prepare to link their carbon markets, but New York's retreat from a similar program casts doubt on the future of regional climate cooperation.

Apr. 2, 2026 at 7:45pm

Got story updates? Submit your updates here. ›

A serene, almost melancholic painting of a lone wind turbine or solar panel standing tall against a backdrop of warm, golden sunlight and deep, dramatic shadows, evoking a sense of both progress and uncertainty in the face of the climate crisis.As New York retreats from climate action, the merger of Western states' cap-and-trade programs offers a glimmer of hope for regional cooperation on emissions reduction.NYC Today

Even as California and Washington state prepare to merge their cap-and-trade climate programs, New York's retreat from creating a similar program has sparked renewed debates about energy costs. After years of painstaking work, California and Washington are poised to merge their programs aimed at reducing emissions and bringing in revenue to help fight climate change. But those hopes are now in doubt as New York Democratic Gov. Kathy Hochul seeks to delay her state's signature climate law, which would establish a cap-and-trade program.

Why it matters

The merger of the California and Washington cap-and-trade programs could create a more stable carbon market and make it easier for multistate companies to comply. However, New York's retreat from a similar program raises concerns that it could cause other states considering a carbon market to hesitate, potentially slowing the spread of this key climate policy tool across the country.

The details

California became the first state to establish an economywide cap-and-trade program in 2013, four years after Congress failed to pass a national program. Washington state followed in 2021, rebranding its program as 'cap-and-invest' with a focus on helping communities most burdened by environmental pollution and climate change. The two states have been working to legally merge their programs, which would make Washington the third government to join California's market, already linked with the Canadian province of Quebec. Meanwhile, in New York, state agencies missed a 2024 deadline to issue regulations for a cap-and-trade program, and Gov. Hochul is now seeking to delay the state's entire climate law, citing affordability concerns.

  • In 2013, California became the first state to establish an economywide cap-and-trade program.
  • In 2021, Washington state lawmakers passed a bill to create a cap-and-invest program.
  • Last month, the three governments (California, Washington, and Quebec) released a draft linkage agreement, a key step in merging their carbon markets.
  • New York state agencies missed a 2024 deadline to issue regulations for a cap-and-trade program.
  • Last month, New York Gov. Kathy Hochul asked lawmakers to delay the state's entire climate law, pushing back deadlines to reduce emissions and casting doubt on the cap-and-trade program.

The players

Kathy Hochul

The Democratic governor of New York who is seeking to delay the state's climate law and cap-and-trade program, citing affordability concerns.

Marko Liias

A Democratic state senator in Washington who serves on the Environment, Energy & Technology Committee and supports the merger of the California and Washington cap-and-trade programs.

Todd Myers

The vice president for research with the Washington Policy Center, a free market think tank that has opposed Washington's cap-and-trade program but welcomes the merger with California and Quebec.

Jessica Spiegel

A vice president with the Western States Petroleum Association, an industry group with members in both California and Washington, who has urged Washington lawmakers to issue more carbon allowances.

Liz Moran

The New York policy advocate with Earthjustice, a nonprofit group that litigates environmental issues, who argues that Hochul is attempting to retaliate for a lawsuit seeking to force her administration to issue cap-and-trade regulations.

Got photos? Submit your photos here. ›

What they’re saying

“Our goal was never to just reduce emissions in the state of Washington. The Trump administration's hostility toward climate action only underscores the need for this kind of regional and subnational cooperation.”

— Marko Liias, Democratic state senator, Washington

“Essentially what happens is that California will subsidize us. I think it's a good move.”

— Todd Myers, Vice president for research, Washington Policy Center

“We have a real backtracking from the governor on the climate law at large, and particularly her own proposed cap-and-invest program. It certainly plays into this false narrative that climate action and affordability run against each other, when in reality we see them as running hand in hand.”

— Liz Moran, New York policy advocate, Earthjustice

What’s next

Lawmakers in Maryland have introduced a bill that would direct state agencies to conduct a study for a potential cap-and-trade program, while Oregon and Rhode Island lawmakers have also revived discussions about carbon pricing policies.

The takeaway

The diverging paths of New York and the Western states on cap-and-trade programs highlight the political challenges of implementing climate policies, even as the need for coordinated action becomes more urgent. The success or failure of these regional carbon markets could have significant implications for the future of climate action across the country.