RGGI Auction 59 Results – 3.8% Decrease | Emissions Watch Blog
March 10, 2023 | Tom Bausemer | Blog Post | emissions-watch | RGGI
Clearing Price of $12.50/ton Marks a 3.8% Decrease Over Previous Auction
The most recent RGGI quarterly auction (Auction 59) was held on March 8, 2023. The clearing price was $12.50/ton, 3.8 percent lower than the clearing price of $12.99/ton on December 7, 2022 (see Figure 1). Auction 59 represents the third consecutive auction with a clearing price at least three percent lower than the previous auction. The trend of lower clearing prices in recent auctions is notable given that clearing prices had increased in 12 consecutive auctions from September 2019 through June 2022.
The clearing price fell short of the 2023 Cost Containment Reserve (CCR) trigger price of $14.88/ton. 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).
Auction 59 Specifics
Bidding interest was strong in Auction 59 and 21,522,877 allowances were sold. Fifty-six entities submitted bids and the quantity of allowances for which bids were submitted was 2.4 times the available supply. Forty-nine bidders secured allowances, with ten bidders purchasing 71 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 59 indicated that following this auction, 60 percent of allowances in circulation were held by compliance entities and 40 percent were held by non-compliance entities. Figure 3 shows the percentage of allowances sold to compliance entities versus investors. In this auction, compliance entities purchased significantly more allowances than investors (82 percent versus 18 percent).
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