RGGI NEARS BRINK OF FAILURE AS CARBON AUCTION HITS NEW LOW; UTILITIES & INVESTORS REFUSE TO BID ON “FUTURE” CO-2 PERMITS
The nation’s only mandatory carbon cap-and-trade scheme is nearing the brink of failure, as demand for carbon allowances hit an all-time low at the Sept. 7 auction of the 10-state Regional Greenhouse Gas Initiative.
The auction raised only $14 million – roughly one-tenth of the $117 million record high set two years ago.
RGGI sold less than 18 percent of the 42 million CO-2 current allowances, or permits, offered at the quarterly auction. The clearing price was $1.89 per allowance, the minimum allowed by RGGI.
Even more telling was RGGI’s failure to sell a single one of the 1.8 million future permits it tried to sell for use next year and beyond. The fact that utilities and investors would not bid on future permits is evidence of a lack of confidence in the future of RGGI as it currently exists.
In 13 auctions over the past three years, RGGI has sold $900 million worth of permits on behalf of the states. New Jersey’s share is nearly $107 million.
The next auction, scheduled for Dec. 7, is expected to be the last one that includes New Jersey. The state is pulling out of RGGI at the end of the year, as ordered by Gov. Chris Christie.
The other RGGI states are New York, Connecticut, Massachusetts, Maine, New Hampshire, Vermont, Rhode Island, Delaware and Maryland. Under RGGI, utilities are required to obtain an allowance for each ton of CO-2 released by their electric generators. The cost is ultimately passed along to businesses and consumers in the form of higher rates for electricity.
Follow these links to previous New Jersey Watchdog reports on RGGI:
THE SECRETS TEN STATES & WALL STREET DON’T WANT YOU TO KNOW http://newjersey.watchdog.org/2010/07/28/cap-trade-scheme-is-clouded-in-secrecy/
NJ WATCHDOG SUES STATE OVER CARBON AUCTION “SECRETS” http://newjersey.watchdog.org/2010/09/06/1016/
WHY RGGI IS FAILING & UNLIKELY TO CUT CO-2 EMISSIONS BEFORE 2030 http://newjersey.watchdog.org/2010/11/17/why-rggi-may-fail-to-impact-co-2-emissions-for-20-years/
NJ WATCHDOG SUES STATE OF $777 MILLION OF AUCTION SECRETS http://newjersey.watchdog.org/2011/01/09/1620/
NEW YORK OFFICIALS RELEASE 2,000 RGGI EMAILS TO NJ WATCHDOG; NEW JERSEY STILL CLAIMS THE RECORDS ARE CONFIDENTIAL http://newjersey.watchdog.org/2011/02/20/new-york-releases-2000-rggi-emails-new-jersey-still-claims-records-are-confidential/
NOT DEAD YET! RGGI REBOUNDS WITH $83M CAP & TRADE AUCTION http://newjersey.watchdog.org/2011/03/11/1740/
DEMOCRAT BACKS NEW JERSEY BILL TO REPEAL RGGI CAP & TRADE http://newjersey.watchdog.org/2011/04/20/democrat-suppo…rggi-cap-trade
PSEG FIGHTS TO KEEP CAP & TRADE RECORDS SECRET http://newjersey.watchdog.org/2011/04/25/2307
REPORT? WHAT REPORT? NJDEP IGNORES GLOBAL WARMING LAW http://newjersey.watchdog.org/2011/05/11/report-what-report-njdep-ignores-its-duty-under-global-warming-law/
PSEG & NJDEP TO RATEPAYERS: IT’S NONE OF YOUR BUSINESS! http://newjersey.watchdog.org/2011/05/23/2365/
NEW JERSEY QUITS CAP & TRADE; FUTURE OF RGGI IS UNCERTAIN http://newjersey.watchdog.org/2011/05/26/christie-pulls…rade-uncertain/
NEW JERSEY TO KEEP $102 MILLION IN RGGI DIVORCE SETTLEMENT http://newjersey.watchdog.org/2011/06/02/2455/