Platts launching CSAPR allowance assessments

Platts, effective trade date December 16, is launching daily assessments for eight types and vintages of sulfur dioxide and nitrogen oxides emission allowances that the US Environmental Protection Agency's Cross-State Air Pollution Rule created.

The CSAPR rule is scheduled to take effect January 1 unless court or congressional action affects its scheduled implementation.

Although the so-called 2012 phase 1 trading market for annual SO2 and NOx emissions does not formally begin until the implementation of the rule, some limited market activity has already begun, allowing assessments to be formulated prior to the formal implementation date.

The assessments will be published in Coal Trader, Coal Outlook, and Megawatt Daily, in Platts Electricity Alert and in Platts Market Data.

Assessments will be published for the eight following allowance types and vintages:

CSAPR Group 1 SO2 2012 CSAPR Group 1 SO2 2013 CSAPR Group 2 SO2 2012 CSAPR Group 2 SO2 2013 CSAPR Annual NOx 2012 CSAPR Annual NOx 2013 CSAPR Seasonal NOx 2012 CSAPR Seasonal NOx 2013

The 16 SO2 Group 1 states are Illinois, Indiana, Iowa, Kentucky, Maryland, Michigan, Missouri, New Jersey, New York, North Carolina, Ohio, Pennsylvania, Tennessee, Virginia, West Virginia and Wisconsin.

The seven SO2 Group 2 states are Alabama, Georgia, Kansas, Minnesota, Nebraska, South Carolina and Texas. The 23 states that make up Group 1 and Group 2 all fall under CSAPR's annual NOx provisions.

As of December 15, EPA had not made a final determination regarding the states that will fall under the seasonal NOx provisions. Under its proposal, the seasonal NOx requirements would apply to the same 23 states, plus Arkansas, Florida, Louisiana, Mississippi and Oklahoma.

The new assessments will be formulated based on systematic Market on Close practices using market information from brokers and other market participants. While all available information on trading activity that occurs throughout the day will be considered, bids and offers made and transactions done will be analyzed in relation to time of day to assess values at the end of the trading day, defined by Platts as 4 p.m. Eastern prevailing time.