This dissertation analyzes North Carolina's Clean Smokestacks Act (CSA). By targeting sulfur dioxide (SO2) and nitrogen oxides (NOX) emissions at fourteen coal-fired powerplants owned by Duke Energy and Progress Energy, the CSA implements utility level caps in two phases and allows for trading of emissions within each utility. In my analysis I employ emissions data from the Continuous Emissions Monitoring System (CEMS) and powerplant characteristics from the Emissions and Generation Resource Integrated Database (eGRID). Difference-in-differences and the synthetic control method are used in concert with a nationally representative control group to analyze effectiveness, leakage, and the distribution of damages in the CSA. I estimate that the CSA reduced annual emissions of SO 2 by approximately 100,000 tons and emissions of NOX by approximately 50,000 tons. This result is a smaller estimated effect of the policy than prior studies have shown. Additionally, I provide evidence that the reductions are not due to utilities shifting production and are due to the installation of abatement technology. Estimating avoided damages from 2003 to 2014, the CSA results in estimated benefits of $1.88 billion (2014$).