I don't understand why there's a need for complex cap and trade schemes to deal with carbon emissions from vehicles when there is a perfectly simple way of adding a cost to driving a carbon-emitting vehicle. Just add more taxes to gas. Taxing the vehicles unfairly punishes people who drive gas vehicles but organize their life in such a way that they don't need to drive many miles. Who is more environmentally friendly, someone who drives 60 miles per day in a vehicle that gets 60 miles per gallon or someone who drives 10 miles per day in a vehicle that gets 20 miles per gallon? For that matter, electricity isn't 100% renewable, even in CA, so even people driving fully-electric vehicles will also have some carbon impact, which should be, likewise, taxed. Carbon emissions are an externality and we should be treating them as such.

Taxing vehicle sales and offering subsidies are dumb ways to incentivize reducing environmental impact. Instead, just tax that environmental impact directly and don't punish people who figure out how to live environmentally friendly using older, less environmentally friendly technology. People and companies will adjust their behavior accordingly. As a bonus, instead of costing the state billions, the state will collect billions, so they can spend the money building out renewable energy infrastructure, planting trees, creating more state parks and other programs that benefit the environment.