Interactions among market mechanisms for reducing greenhouse gas emissions in California

Cap-and-trade, the renewables portfolio standard and the Low Carbon Fuel Standard are important parts of California's efforts to reduce GHG emissions. Cap-and-trade interacts with RPS to help utilities pay for the RPS. If LCFS brings medium carbon-intensity fuel to market, that would free up allowances for other sectors. Cap-and-trade is not serving as a cost-minimizing mechanism.