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WCA Schedule
- Q2 Auction Application Deadline
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May 6, 2024 |
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May 24, 2024 |
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June 5, 2024 |
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June 12, 2024 |
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- Q3 Auction Application Deadline
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August 5, 2024 |
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August 23, 2024 |
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September 4, 2024 |
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September 11, 2024 |
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- Q4 Auction Application Deadline
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November 4, 2024 |
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November 22, 2024 |
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December 4, 2024 |
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December 11, 2024 |
News Update
- Washington Gov. Inslee signs GHG program tax exemption. Governor Jay Inslee (D) has signed a bill into legislation which grants tax exemption to revenue generated from the purchase and sale of carbon allowances and credits for covered and opt-in entities in the cap-and-trade program. HB 2199’s exemption from the state's business and occupation tax and public utility tax specifically includes revenue from the sale, purchase, generation, transfer and compliance retirement of Washington Carbon Allowances (WCAs), and no-cost allowances allocated to specific industries, price ceiling units, and carbon offsets.
- Q1 2024 auction clears at record low. Amid the persisting uncertainty over the future of the Washington market, the state’s first quarterly auction of 2024 cleared at the lowest price seen since the program’s inception. The auction held on March 6th, 2024, sold all of the 7.4 M allowances supplied at the clearing price of $25.76/t, marking a sharp 50% drop compared to the previous auction clearing price of $51.89 seen in the December 2023 auction. The March auction cleared just $1.74 above the auction floor price of $24.02, and $30.40 below the allowance price containment reserve (ACPR) auction trigger price of $56.16, thereby bypassing the trigger and leaving the next regular quarterly auction scheduled for June 6th, 2024.
- Washington cap-and-trade bills to go before Gov. Inslee. Washington lawmakers have advanced three bills to go before Governor Inslee. Of the three bills, SB 6058 intends to remove barriers in the state’s cap-and-trade program ahead of linkage discussions with the California and Quebec jurisdictions to align the Washington program with joint market. The changes proposed in SB 6058 include allowing carbon offsets originating outside of Washington to be eligible towards compliance obligations, aligning with the joint market’s three-year compliance periods, and granting the Washington State Department of Ecology the power to set compliance obligations for imported electricity. The other bills include HB 2119 regarding tax exemptions for the cap-and-trade program as discussed above, and SB 6047, which would allow public utilities and other government agencies to plan cap-and-trade auction bids outside of public sessions.
- CFTC to finish CO2 offset guidance in July. The US Commodity Futures Trading Commission (CFTC) hopes to finalize guidance for derivates contracts for voluntary carbon offsets within the next few months, according to CFTC chairman Rostin Behnam. The CFTC proposed guidance for futures and options last year to exchanges in hopes of strengthening the integrity of the carbon market, but exchanges such as the Intercontinental Exchange (ICE) and the Chicago Mercantile Exchange (CME) have warned the CFTC that the guidance could take them outside of their depth as exchanges by requiring them to ensure the carbon offsets associated with the derivatives listed on the exchanges adhere to “real, additional, permanent, verifiable” emission reductions. While the guidance is non-binding in its current state, exchanges may be reluctant to list new contracts due to the imposed scrutiny and cost of reviews, which in turn would weaken the developing market. The CFTC is still reviewing public comments regarding the guidance and plan to finalize by July 2024.
Offsets Update
- ECY has issued 61,130 new Emission Offset Credits (EOCs) in February 2024. To date, ECY has issued 310,266 since the first issuance in December 2023, all of which have been issued to three projects using the ozone depleting substance (ODS) protocol provided by ECY.
- In the first compliance period from 2023-2026, no more than 5% of an entity’s compliance obligation may be met using EOCs, however an additional 3% may be met by EOCs that are generated from offset projects on federally recognized tribal land.
WCA Pricing Update
Pricing as of March 18th, 2023:
- Vintage 2024 – Mar. 2024 Delivery: $28.81
- Vintage 2024 – Dec. 2024 Delivery: $30.51
- Vintage 2024 Average Daily Price (Feb. 2024): $34.27
Market Update
- Dec-24 allowance prices began recovering in February after experiencing unprecedented drops over the course of January. Pricing opened at $35.00 to start the month and sank to a record low of $33.12 on Feb. 5th, before returning up to $36.00 to close out the first full week. Prices then steadily climbed to the month-high of $37.25 during the second week, before slowly tracing down to $36.68 to finish the third week of the month. Allowance pricing continued to descend into the fourth week down to $35.38 to close out the month.
- WCAs set a new all-time low for Dec-24 allowances at $33.12, marking a 39% YTD drop on Feb. 5th, 2024.
- All 7.4M allowances offered in the quarterly auction held on Mar. 6th cleared at $25.76, just $1.74 above the auction floor price, and $30.40 below the Tier 1 APCR trigger price, marking the lowest auction settlement seen in the program its inception.
Figure 1. WCA Daily Transactions (Mar. 2023 to Present)
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WCA Pricing (Vintage 2024)
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Dec. '24 Delivery
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Prompt Delivery
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Average Daily Price (2024):
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$ 39.54
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$ 42.02
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Average Monthly Price (Feb. 2024):
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$ 35.96
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$ 34.27
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2024 Highest Daily Price:
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$ 54.00 (Jan. 2nd, 2024)
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$ 52.20 (Jan. 2nd, 2024)
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