West Coast Carbon Prices

Affordability and high prices continue to be top of mind for consumers. Legislators, both in Washington, D.C. and state capitals, are paying attention. In the energy realm, lawmakers have considered – and in some case implemented – programs that affect the price of heating fuels (e.g., Cap-and-Invest, Clean Heat Standard) and transportation fuels (e.g., Low Carbon Fuel Standard, Clean Fuel Standard) used by residential and commercial customers. By attaching a fixed cost or financial fee for the use of certain energy sources, policymakers hope these programs will reduce greenhouse gas emissions by penalizing their use.

The West Coast is home to multiple economy-wide carbon pricing programs that, ultimately, impact retail energy costs. Under Cap-and-Trade/Cap-and-Invest, obligated parties must pay to acquire “programmatic allowances,” each of which allows the entity to emit a certain amount of carbon emissions.

• Washington State’s Cap-and-Invest Program. November 2025 Auction = $60.43 per Tier 1 Allowance.
  • November 2025 Average Propane Cap-at-Rack Price = 39 cents per gallon.
• California’s Cap-and-Trade Program. November 2025 Auction = $28.32 per Allowance.
  • Program is linked with Quebec’s (Canada) Cap-and-Trade system.

Notably, New York is currently designing a Cap-and-Invest program that, like Washington and California, would ultimately impact retail propane prices paid by energy consumers. Based on the 2024 sales report, California is the largest state market (532 million gallons), New York is the third-largest state market (430 million gallons), and Washington State is 20^th largest market (180 million gallons).

For more information, contact NPGA’s Senior Director of State Advocacy & Affairs, Jacob Peterson.