RGGI IN 2ND EMISSIONS AUCTION

Going once, going twice: 31.5 tons of carbon on the block in 2nd greenhouse gas auction
Mary Esch, December 18, 2008 (AP via Yahoo Finance)

"The Regional Greenhouse Gas Initiative requires power plants to pay for every ton of carbon dioxide they produce, providing a financial incentive to cut emissions…The program is seen as a model for greenhouse gas reduction programs nationally…the RGGI program may eventually merge with the Western Climate Initiative, which is being developed by California, six other western states, and four Canadian provinces…The RGGI states are New York, Connecticut, Delaware, Maine, Maryland, Massachusetts, New Hampshire, New Jersey, Rhode Island and Vermont.

"The first [RGGI] auction [in September]…netted nearly $40 million for renewable and energy-efficient technologies in the participating states…Bids in [the recent second auction]…will be used to determine a clearing price based on supply versus demand. The minimum clearing price is set at $1.86 per ton.

"The price in the first auction ended up at $3.07…If the clearing price is the same as in September, that would bring the states $197 million for energy efficiency and greenhouse gas-reducing programs…The cap is scheduled to be reduced by 2.5 percent a year between 2015 and 2018, but the reduction may be accelerated if actual emissions drop faster than that as companies switch to cleaner fuel and more efficient technologies. The idea is to make it more cost-effective for companies to invest in cleaner technology than to pay for emissions…"