On September 9, 2016, the Maine Public Utilities Commission announced the results of the 33rd auction of carbon dioxide (CO2) allowances by the nine Northeastern and Mid-Atlantic states participating in the Regional Greenhouse Gas Initiative (RGGI), the nation’s first market-based regulatory program to reduce greenhouse gas (GHG) pollution.
The September 7th auction was the third auction of 2016, and generated $67.7 million. There were 14,911,315 CO2 allowances were sold at the auction at a clearing price of $4.54. Bids for allowances ranged from $2.10 to $12.65 per allowance. The money generated is allocated among the nine RGGI States which in turn utilize and invest the funds pursuant to state laws and rules.
Maine’s portion of Auction 33 proceeds is about $2.2 million. Since RGGI’s inception, Maine has received $81.8 million which has been used to finance rate relief, energy efficiency and renewable energy projects. Many of these programs and projects are managed through the Efficiency Maine Trust.
“I am pleased that the market monitor has reported that Auction 33 was a competitive auction with no indication of market manipulation or collusion,” said MPUC Commissioner Carlisle McLean, who also serves as the RGGI Inc. Treasurer. She also said, “RGGI continues to make strides toward a clean, low-cost electricity system while also providing revenue for each state to invest to their advantage. Although one of the smaller RGGI states, Maine continues to benefit from participating in the program.”
About the Regional Greenhouse Gas Initiative
The Northeast and Mid-Atlantic states participating in the third RGGI control period (Connecticut, Delaware, Maine, Maryland, Massachusetts, New Hampshire, New York, Rhode Island, and Vermont) have implemented a mandatory market-based regulatory program in the U.S. to reduce greenhouse gas emissions. The 2016 RGGI cap is 86.5 million short tons. The RGGI cap declines 2.5 percent each year until 2020. The RGGI states also include interim adjustments to the RGGI cap to account for banked CO2 allowances. The 2016 RGGI adjusted cap is 64.6 million short tons. RGGI is composed of individual CO2 budget trading programs in each state, based on each state’s independent legal authority. A CO2 allowance represents a limited authorization to emit one short ton of CO2, as issued by a respective state. A regulated power plant must hold CO2 allowances equal to its emissions for each three-year control period. RGGI’s third control period began on January 1, 2015 and extends through December 31, 2017. For more information visit www.rggi.org.
Image credit: Air pollution image courtesy of publicdomainpictures.net.