John Whitehead wants instructions

John talks about Jerry Brown's energy tax hike:

One feature of economic incentive-based environmental policy is that it is possible to achieve (1) a given amount of emissions reductions at lower cost and/or (2) additional emissions reductions at the same cost relative to environmental standards (i.e., command and control regulation):

Gov. Jerry Brown issued an executive order Wednesday dramatically ramping up this state’s already ambitious program aimed at curbing greenhouse gas emissions, saying it was critical to address what he called “an ever-growing threat” posed by global warming to the state’s economy and well-being.
Under Mr. Brown’s order, emissions would have to be reduced by 40 percent over 1990 levels by 2030. Under existing state law, emissions are supposed to be cut back by 80 percent over 1990 levels by 2050, and Mr. Brown said this tough new interim target was essential to helping the state make investment and regulatory decisions that will assure that goal is reached.
Mr. Brown’s order marks an aggressive turn in what had already been among the toughest programs in the nation aimed at reducing greenhouse gas emissions. Under the law put into place by Mr. Brown’s predecessor, Arnold Schwarzenegger, the state was required to reduce greenhouse gas emissions to 1990 levels by 2020 on the way to reach the 2050 target; California is already well on its way to meeting the 2020 goal, and may exceed it, officials said Wednesday.

Then John aks:

Unless I'm told otherwise, I'm attributing California's ability achieve additional emissions reductions to cap-and-trade. 

Well John, the data will tell you, and I am at your side collecting data and looking as past results.  We have a couple of complexities here.

1) California CapnTrade is a net revenue gain for government
2) California government invests in energy inefficient systems.
3) CapnTrade prices usually drop faster than the economy down turns.

So how can we answer your question?

We are going to see if Jerry gets more taxes for his projects that increase emissions.  We are going to check the private sector sensitivity to energy prices. If the private sector is more sensitive to energy prices than government spending, then we have our answer, Jerry will increase emissions with CapnTrade because it is a net tax increase the way it is designed..