Carbon-Free Prosperity in California: Policies for Success

This report by Energy Innovation outlines policy recommendations to help California achieve its goal of an 80 percent reduction in greenhouse gas emissions below 1990 levels by 2050. The authors argue that while the state is on track for its 2020 goals, it must accelerate policy development in electricity, buildings, transportation, and methane emissions, while expanding cooperation with other U.S. states and China.

• To maintain progress toward the 2050 goal of an 80 percent reduction in greenhouse gas emissions below 1990 levels, California must establish a carbon cap for the year 2030 to provide policy certainty and encourage long-term investment.
• In the electricity sector, the report recommends transitioning from cost-of-service regulation to a performance-based model that aligns utility incentives with long-term climate goals, and redesigning wholesale power markets to value 'flexible resources' such as storage and demand-side resources.
• For buildings, the report suggests accelerating the implementation of AB 758 to improve energy efficiency in existing buildings, requiring energy performance labels during home sales, and increasing the ambition of energy performance standards for appliances.
• Transportation policy recommendations include enhancing the Low Carbon Fuel Standard (LCFS) with a price floor and a cost-containment mechanism, and using carbon permit auction revenue to fund public transit contingent on the adoption of smart growth policies like congestion pricing.
• Regarding oil and gas production, the report urges California to develop 'gold standard' methane emissions standards for the entire lifecycle of production, processing, storage, transport, and distribution, noting that methane levels in Los Angeles were found to be 50 percent higher than CARB data suggested.
• The report advocates for continued subnational cooperation, specifically through a west coast carbon strategy with Oregon, Washington, and British Columbia, and providing technical assistance to China on emissions trading, air pollution control, and CO2 reduction strategies.

APA

Harvey, H., & Busch, C. (2014). Carbon-Free Prosperity in California: Policies for Success. Energy Innovation. https://energyinnovation.org/wp-content/uploads/Carbon-Free-Prosperity-in-California.pdf

Chicago

Harvey, Hal, and Chris Busch. Carbon-Free Prosperity in California: Policies for Success. Energy Innovation, 2014. https://energyinnovation.org/wp-content/uploads/Carbon-Free-Prosperity-in-California.pdf.

Wikipedia

{{cite report |last1=Harvey |first1=Hal |last2=Busch |first2=Chris |title=Carbon-Free Prosperity in California: Policies for Success |publisher=Energy Innovation |date=February 2014 |url=https://energyinnovation.org/wp-content/uploads/Carbon-Free-Prosperity-in-California.pdf |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{harvey2014carbonfree, author = {Harvey, Hal and Busch, Chris}, title = {{Carbon-Free Prosperity in California: Policies for Success}}, institution = {Energy Innovation}, year = {2014}, month = feb, url = {https://energyinnovation.org/wp-content/uploads/Carbon-Free-Prosperity-in-California.pdf}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }