Tradeable Energy Performance Standards Act

The Tradeable Energy Performance Standards Act establishes a market-based system for reducing carbon emissions from large energy facilities. Covered facilities (electricity and thermal energy producers above certain size thresholds) must obtain emission allowances for each metric ton of CO2 they emit, either by receiving allowances from the government or purchasing them. Facilities can also pay increasing fees (starting at $50 per ton in 2028) or trade allowances with other facilities through bilateral agreements. The bill creates an offset program to fund projects that reduce emissions or sequester carbon, with grants awarded based on cost-effectiveness.