NEW YORK – The price of a permit to emit one ton of carbon in the Northeast states’ regional cap-and-trade program fell by 8 percent in the program’s third auction, which was held earlier this week, administrators said today.
The Regional Greenhouse Gas Initiative (RGGI) said it sold all of the nearly 31 million permits for carbon emitted in 2009-2011 that were up for auction at a clearing price of $3.23 per permit. The electronic auction was held on Wednesday.
That was down from the price of $3.51 each that the permits fetched in the previous auction last March, but the number of separate entities placing bids rose to 54, compared with 50 in March.
The auction raised $104.2 million for energy efficiency, renewable energy and other programs in the 10 participating states, which include Rhode Island, according to RGGI Inc., which administers the program on the states’ behalf.
Rhode Island will receive $1.49 million in proceeds from this week’s auction, RGGI said. The R.I. Office of Energy Resources earlier this year outlined plans to spend the money by expanding a number of existing energy efficiency programs overseen by National Grid, Rhode Island’s dominant gas and electric utility company.
The bidders included National Grid and a subsidiary of Dominion Resources Inc., which owns Providence’s Manchester Street and Somerset’s Brayton Point power plants.
In addition, RGGI sold all of the nearly 2.2 million permits for carbon emitted in 2012 on offer for a clearing price of $2.06 each. That was down by a third from the March auction, when 2012 permits sold for $3.05 each.
The future of the RGGI program is currently uncertain as Congress considers a federal cap-and-trade program to reduce greenhouse gas emissions. A bill under consideration by the House of Representatives would end the RGGI program and allow holders of RGGI allowances to exchange them for federal permits.
RGGI is a 10-state compact that calls for freezing and then reducing carbon dioxide emissions, a leading cause of climate change, by 10 percent over the next decade. Under RGGI (pronounced “reggie”), power plants that use fossil fuels must buy a permit for every ton of carbon dioxide they emit.
Although the cap for emissions technically went into effect on Jan. 1, there is a three-year compliance period, meaning polluters do not have to submit allowances to cover their 2009-2011 emissions until March 31, 2012.
The next RGGI auction is scheduled to be held Sept. 9.
