RGGI – Results from the first U.S. cap-and-trade GHG permit auction

Michael Giberson

The results from the first RGGI auction have been announced, coming in louder than a whimper, but softer than a bang. As the WSJ Environmental Capital blog reports, “Demand was actually pretty strong.” About 50 million units were bid upon, while just 12.5 million were offered. The demand pushed the clearing price to $3.07 a ton, higher than the $1.86 a ton minimum bid.

From the RGGI results page:

Auction
Number
 
Auction
Format
Allocation
Year
Quantity
Offered
Quantity
Sold
Clearing
Price
  Reports
CO2 Allowance
Auction  1
9/25/2008
 
Sealed
Bid,
Uniform Price
2009 12,565,387 12,565,387 $3.07   PDF
CO2 Allowance
Auction 2.1
12/17/2008
 
TBD 2009 TBD TBD TBD  
COAllowance
Auction 2.2
12/17/2008
 
TBD 2012 TBD TBD TBD  

The market monitor reported, “We observed the auction as it occurred and have completed our review and analysis of its results. Based on our monitoring of participant conduct in the auction, we find no material evidence of collusion or manipulation by bidders.”

As Environmental Capital notes, the $3.07 a ton price is substantially lower than prices in Europe, but as we noted here last week, “I can imagine that the program designers were interested in not beginning with a bang.”

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