: relating to or being a system that caps the amount of carbon emissions a given company may produce but allows it to buy rights to produce additional emissions from a company that does not use the equivalent amount of its own allowance

Examples of cap-and-trade in a Sentence

Recent Examples on the Web
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The rail project currently receives 25% of the cap-and-trade proceeds, which is roughly $1 billion annually depending on the year. Trân Nguyễn, Los Angeles Times, 28 June 2025 The budget agreement does not reauthorize the cap-and-trade program and leaves many of those questions unanswered for later in the session or next year. Grant Stringer, Mercury News, 27 June 2025 The spending agreement also backfills $1 billion in General Fund spending from the Greenhouse Gas Reduction Fund, which is funded by cap-and-trade auctions to pay for climate projects. Nicole Nixon, Sacbee.com, 25 June 2025 But canceling the bullet train and allowing the costly cap-and-trade program to expire would significantly reduce the cost of living in California by cutting the price of energy and everything that uses energy. The Editorial Board, Oc Register, 11 June 2025 See All Example Sentences for cap-and-trade

Word History

First Known Use

1995, in the meaning defined above

Time Traveler
The first known use of cap-and-trade was in 1995

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Cite this Entry

“Cap-and-trade.” Merriam-Webster.com Dictionary, Merriam-Webster, https://www.merriam-webster.com/dictionary/cap-and-trade. Accessed 5 Jul. 2025.

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