The Regional Greenhouse Gas Initiative (RGGI) will hold its first auction for permits of more than 12 million tons of emissions in September. But experts predict that U.S. Northeast power companies will not race to buy carbon emissions permits. The region’s emissions of the gas has slipped over the last few years and were about 9 percent below the group’s cap of 188 million tons of CO2 in 2007, Reuters reports, via the Guardian.
RGGI’s Executive Director, Jonathan Schrag, told Reuters that the group could retire allocations if they fail to sell in the auction for the $1.86 per ton reserve price. This would help remove excess supply, bring up prices, and make it more painful for companies to pollute.
The Chicago Climate Futures Exchange began offering exchange-traded Regional Greenhouse Gas Initiative contracts in August.