A "cap-and-trade" system for reducing carbon emissions from power plants and other industrial facilities would cut total emissions 14% below 2005 levels by 2020 and 83% below 2005 by 2050.
The proposal -- potentially one of the most far-reaching elements in the budget blueprint -- is unusually detailed. That suggests that President Obama will be less willing to negotiate with Congress over the specifics of his global warming strategy.
Under the plan, the government would issue permits setting emissions maximums -- caps -- for individual facilities. The caps would tighten annually to achieve the overall federal goals.
Under the "trade" part of the plan, plants that exceeded their emissions cap could buy permits at government auction to cover the excess, either from the government or from companies that did not reach their maximum.