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Last spring, the Washington Department of Ecology notified Cap-and-Invest market participants about rulemaking focused on implementation of Senate Bill 6058 and other changes to Chapter 173-446 WAC and Chapter 173-441 WAC necessary to facilitate linkage. We also sent a market notice about SB 6058 implementation in November 2024.
- Topics the Climate Commitment Act requires Ecology to address prior to Oct. 1, 2026, which include:
- Adoption of allowance budgets for the second compliance period (2027-2030) to ensure that emissions reductions are aligned with the state’s greenhouse gas emissions limits for 2030, 2040, and 2050.
- This includes adjustments to the emissions baseline to incorporate municipal waste-to-energy facilities, a new sector covered by the Cap-and-Invest program starting in the second compliance period. RCW 70A.65.070(1)(b)
- Continuing to address imported electricity associated with centralized electricity markets, pursuant to RCW 70A.65.080(1)(c).
- Rules on the amount of allowances allocated at no cost to electric utilities that must be consigned to auction during the second compliance period, pursuant to RCW 70A.65.120(3)(b).
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Amendments to clarify statutory requirements, implement new statutory authority, and make other changes to address elements identified by Ecology during the first two years of implementing the Cap-and-Invest Program to improve the overall program.
During the rulemaking process, Ecology will gather public input on potential changes to the rule. California and Québec are currently considering amendments to their cap-and-trade regulations. Changes to those programs will be reviewed during Washington’s rulemaking process. If the Legislature modifies Chapter 70A.65 RCW during the 2025 legislative session, Ecology will incorporate any necessary rule changes into this rulemaking process. The rulemaking topics may continue to evolve as we gather additional information, receive input from interested parties, and review California’s and Québec’s proposals.
We expect to adopt changes to the rules in summer 2026. We will share additional information on the expected timeline for the rulemaking as part of the rule announcement and continue to update the Cap-and-Invest rulemaking webpage.
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