Third RGGI Auction Raises $117M for Renewables and Efficiency

Third RGGI Auction Raises $117M for Renewables and Efficiency

The Regional Greenhouse Gas Initiative's (RGGI) third carbon allowance auction raised $117 million last week for energy efficiency and renewable energy programs in 10 Northeastern states.

RGGI, the country's first greenhouse gas cap-and-trade system, officially began Jan. 1. Though the number of bids submitted was lower than in the second auction in December, the per-ton price inched up 13 cents.

About 50 buyers snatched up 31.5 million 2009 allowances at $3.51 per ton of carbon dioxide, compared to $3.38 per ton in the second auction and $3.07 in the first.

A parallel offering of nearly 2.2 million allowances for the next RGGI control period that begins in 2012 sold for $3.05 per ton. All told, the three auctions have generated more than $262 million in revenue distributed among the states, which include Connecticut, Maine, Maryland, Massachusetts, Rhode Island, Vermont, New York, New Jersey, New Hampshire and Delaware.

The majority of bidders for both types of allowances in Wednesday's auction were electricity generators buying the permits for compliance purposes. The next auction is scheduled for June.

The system's cap is set at 188 million metric tons of carbon dioxide equivalent, which will be ratcheted down incrementally through 2018 for a 10 percent total reduction. Several reports, however, indicate emissions in 2008 were between 16 percent and 17 percent lower than the cap.