RGGI Carbon Allowance Auction Price Falls 8% to $3.23

June 19, 2009

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All 30.8 million allowances under the Regional Greenhouse Gas Initiative (RGGI) were sold at auction this week, fetching an average price of $3.23 per allowance.

That price is down from the $3.51 achieved in the March auction. View the entire auction results here.

This time, the minimum bid was set at $1.86, with a maximum of $12.

One bidder bought up 7.7 million allowances or nearly a fourth of all those available. In all, four bidders purchased 2 million or more emission allowances, with nine bidders buying 1 million or more, and 18 bidders scooping up 250,000 allowances or more.

The auction generated $104.2 million for the 10 participating Northeast and Mid-Atlantic states, with funds to be put toward investments in energy efficiency programs and renewable energy, among other initiatives.

Prices for 2012 vintage allowances received a lower price of $2.06.

In a separate document, Point Carbon notes that the RGGI and other regional carbon trading initiatives would be adversely affected by the Waxman-Markey climate bill winding its way through the House of Representatives.

Utilities buying allowances from regional programs would be able to trade in their regional allowances at a value equal to what they paid. In that case, utilities and other emitters would be forced to spend more at that time. For instance, if the government sets a $13-17 price for carbon, and a utility has bought 1,000 regional allowances at $3.50 each, the utility would receive only about 250 federal allowances, meaning that it would have to spend more on down the line.

In other carbon-tracking news, Know The Number unveiled a 70-foot-tall billboard (see above image) in New York City, near Madisson Square Garden, that is a real-time estimation of global carbon emissions. The carbon counter also is available on the Web, where individuals and businesses can download a real-time widget for their computer desktop or Web site.

As of Friday, June 19, the carbon counter stood at more than 3.6 trillion metric tons.

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