California and Québec in early August will conduct a practice carbon auction for their linked cap-and-trade programs, according to the California Air Resources Board and the ministère du Développement durable, de l’Environnement et de la Lutte contre les changements climatiques (Ministry of Sustainable Development, Environment and the Fight against Climate Change) of Québec.
A successful practice auction will pave the way to holding the first joint auction of carbon allowances by the two programs in November 2014, the two agencies say.
Application for the practice auction will begin in the last week of July, and the bidding window will be open one day during the first week of August. All registered participants in the California and Québec programs are eligible to participate in the practice auction.
During the practice auction, participants will test the updated auction platform and become familiar with the new features that support a joint auction, such as the handling of both Canadian and US currency. California and Québec officials will monitor the practice auction simultaneously, testing and verifying joint oversight and communication procedures. Following the practice auction, the ARB and the MDDELCC will evaluate its performance to confirm that all systems and procedures work properly.
California companies bought all 16.95 million allowances to release carbon emissions at the state’s most recent cap-and-trade auction. The state’s seventh auction on May 16 sold carbon allowances for $11.50 each. An additional 4 million permits that can’t be used until 2017, of the 9.2 million that were available, sold at $11.36.