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RGGI secondary market CO2 allowance prices flat to higher to end January

Regional Greenhouse Gas Initiative CO2 allowance prices at the secondary market were flat to a touch higher during the week ended Jan. 25.

Broker data show the RGGI spot allowance contract in a bid-and-offer range of $3.61/ton to $3.91/ton, rising 1 cent week over week. The January 2017 vintage 2017 contract was marked in a bid-and-ask spread of $3.63/ton to $3.92/ton, also increasing 1 cents from the week prior.

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As of Jan. 25, the December 2017 vintage 2017 futures contract was assessed in a bid-and-offer range of $3.75/ton to $4.00/ton, flat from the week before.

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Over-the-counter RGGI CO2 allowance prices ramped higher earlier in the month after it was confirmed that the Indian Point nuclear power plant in New York will be shuttered ahead of schedule. Entergy Corp. said it will shut the first of Indian Point's two reactors, Indian Point 2, by April 30, 2020, followed by Indian Point 3 by April 30, 2021. The two units produce a total of 2,078 MW.

Sources have indicated that assuming the lost generation from Indian Point is replaced with mostly natural gas, statewide carbon emissions could increase anywhere from 10% to 15% a year.

RGGI is made up of nine states: Connecticut, Delaware, Maine, Massachusetts, Maryland, New Hampshire, New York, Rhode Island and Vermont. The participating states use a market-based cap-and-trade program to reduce greenhouse gas emissions from regional power plants, selling nearly all emissions allowances through auctions and investing proceeds in energy efficiency projects in the residential, commercial and municipal sectors.

The RGGI states are working on an extended program review that began in 2016, with a focus on the potential tightening of the program's emissions cap, as well as coordination with the implementation of the Clean Power Plan. The states will hold a webinar Jan. 31 to review proposed design elements and updated modeling analyses.

Market prices and included industry data are current as of the time of publication and are subject to change. For more detailed market data, including power, natural gas index prices, as well as forwards and futures, visit our Commodities Pages.