Regional Greenhouse Gas Initiative surpasses $1 billion in proceeds
On September 5, the Regional Greenhouse Gas Initiative (RGGI) held its 17th auction of carbon dioxide (CO2) allowances. Generators in the nine RGGI states bought a total of 24.5 million allowances in the auction, one for each ton of CO2 emitted in the compliance period. Bids for the CO2 allowances ranged from $1.93 to $6.51 per allowance, with a clearing price of $1.93, the minimum reserve price for the auction. With states generally holding excess allowances, sales of allowances in auction 17 represented only 65 percent of the 37.9 million allowances offered for sale. Proceeds from the auction amounted to $47.4 million, which the states typically spend on energy efficiency, clean and renewable energy, direct bill assistance, and other consumer benefit programs.
With this auction, RGGI has surpassed the $1 billion mark for net cumulative proceeds since 2008 from all RGGI states, including amounts from New Jersey although the state no longer participates in RGGI. To date, the total cumulative proceeds for the six New England states amounts to about $334 million.
RGGI auction proceeds are an important funding mechanism for energy-efficiency programs in New England and are therefore a critical element in ISO’s process to forecast energy efficiency and its long-term impact on the grid.