The Regional Greenhouse Gas Initiative (RGGI) had its very first auction for CO2 allowances last week. All allowances offered in Auction 1 were sold at $3.07.
RGGI (commonly pronounced "Reggie") is the first mandatory, market-based effort in the US to reduce greenhouse gas emissions. Ten Northeastern and Mid-Atlantic states will cap and then reduce CO2 emissions from the power sector 10% by 2018. In cap-and-trade, global warming pollution is limited to an agreed-upon cap that declines over time. The governing authority issues "permits", also called "allowances", corresponding to the cap, with one allowance equal to a ton of CO2 or its equivalent in greenhouse gases. Companies must have allowances for any global warming pollution they emit.
Under RGGI, states will sell emission allowances through auctions and invest proceeds in consumer benefits: energy efficiency, renewable energy, and other clean energy technologies. RGGI hopes to spur innovation in the clean energy economy and create green jobs in the participating states.
Learn more here: http://rggi.org/rggi