Californiacarbon allowance prices at the over-the-counter market have backed off the$13.00/tonne-mark to conclude the month of September. During the week endedSept. 27, the spot California carbon allowance contract was seen in a bid-and-askspread of $12.92/tonne to $12.97/tonne, stumbling 3 cents on the week.
TheSeptember 2016 vintage 2016 California carbon allowance contract was assessedin a bid-and-ask range of $12.89/tonne to $12.97/tonne, down 1 cent from theweek prior. The December 2016 vintage 2016 California carbon futures contractwas unchanged on the weekly period in a bid-and-offer spread of $12.92/tonne to$13.05/tonne.
Tradingvolumes in the California carbon secondary market have been thin in the lastfew weeks as many compliance entities have likely purchased needed allowances.
Inother news, the California Air Resources Board held a public hearing Sept. 22to discuss previously proposed amendments to the California cap-and-trade system. Theseamendments include setting new emissions caps for 2021 to 2050, extending thecap-and-trade program beyond 2030 and integrating the program with federalrequirements under the Clean Power Plan.
TheClean Power Plan would require states to meet individual carbon emissions ratelimits at existing power plants beginning in 2022. CARB staff is proposing touse the proposed post-2020 program to comply with the Clean Power Plan,including the use of a bridge period to link the two programs.
Followinga series of informal workshops earlier in the year, CARB staff developed thedraft proposal that would also allow for the continued linkage with Quebecbeyond 2020, as well as future linkage with Ontario and other jurisdictions;continue to prevent emissions leakage in the most cost-effective manner; andextend the allocation of allowances to the state's utilities.
California'sprogram is currently linked with the cap-and-trade system of Quebec under theWestern Climate Initiative. Proposed amendments would link the California andQuebec joint programs with the emerging program in Ontario beginning in 2018.
TheCARB adopted the state's cap-and-trade regulation in October 2011, which wentinto effect Jan. 1, 2012. The first compliance period began Jan. 1, 2013, withthe second compliance period covering 2015 to 2017, and the third complianceperiod running from 2018 to 2020.
Theproposed draft changes will be voted on by the CARB at a meeting slated forearly 2017. If the amendments are adopted, they would become effective Oct. 1,2017.
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