RGGI Auction 57 Clears At $13.45, Allowance Prices Drop 3% | Emissions Watch Blog

Published September 9, 2022 | Brian Doyle | Blog Postemissions-watch

RGGI Auction 57 was held on September 7, 2022. The clearing price was $13.45/ton, 3% lower than the clearing price of $13.90/ton on June 1st (see Figure 1). Although the clearing price was only $0.45/ton lower than the most recent auction, Auction 57 marks the first time since Auction 45 in September 2019 that the clearing price has declined from the previous auction.

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The clearing price fell short of the 2022 Cost Containment Reserve (CCR) trigger price of $13.91/ton.[1] The CCR provision is a mechanism that allows for the release of additional allowances when auction prices exceed the established price threshold (the trigger price).

[1] The CCR trigger price increases by 7 percent each year.

Auction 57 Specifics

Bidding interest was strong in Auction 57 and 22,404,023 allowances were sold.  Sixty-six entities submitted bids and the quantity of allowances for which bids were submitted was 2.6 times the available supply. Fifty-two bidders secured allowances, with ten bidders purchasing 66 percent of all the available allowances. Figure 2 shows the breakdown of allowances sold to each of the successful bidders.

The Market Monitor report for Auction 57 indicated that following this auction, 54 percent of allowances in circulation were held by compliance entities and 46 percent were held by non-compliance entities.

RGGI Auction 57 Figure 1
RGGI Auction 57 Figure 2
RGGI Auction 57 Figure 3

Figure 3 shows the percentage of allowances sold to compliance entities versus investors. In this auction, compliance entities purchased significantly more allowances than investors (80 percent versus 20 percent).

ESAI provides detailed analysis of the RGGI market, including an allowance price forecast, emissions projections, and updates on relevant policy and regulatory developments. For more information on how to access this information, please contact Brian Doyle at [email protected]

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