CARB November 19 Cap-and-Trade Auction Cancelled – To Be Rescheduled

In a brief message posted to the California Air Resources Board’s (CARB) website, CARB notified cap-and-trade participants of the cancellation of the scheduled November 19, 2014 joint auction. Citing "technical difficulties," CARB sent an email to all participating account representatives apologizing for the last minute cancellation of Wednesday's auction and informing everyone that the auction would be rescheduled for another day. It hasn't yet been rescheduled. Nor is it known whether participants will be required to resubmit documentation for participation in a rescheduled auction.

Wednesday's auction was to be the first joint auction with Quebec that would have extended the sale of carbon credits beyond California. A successful auction would have allowed carbon credits purchased in California to be used by companies to emit carbon in Quebec, and vice versa. So far, California is the only North American government entity with a carbon market, an issue that has been a sore spot for all of the obligated entities, including our own food processing industry.

News reports indicate CARB had initially identified the problem as access to the electronic auction platform which was only allowing partial access to the auction. CARB has not yet indicated a date for rescheduling the auction, although Quebec said the new date "will be announced as soon as possible."

This glitch in the system may serve to increase the concerns regarding the efficacy of the cap-and-trade system and does not come at a good time for CARB. Starting January 1, 2015, natural gas and motor-vehicle emissions will become part of the carbon initiative, adding a number of new market participants seeking credits to the more than 400 industrial users already subject to the emissions ceiling.

CLFP will continue to monitor the situation and provide updates as they are made available by CARB staff.

Article written by John Larrea, CLFP Government Affairs Director

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CALIFORNIA LEAGUE OF FOOD PROCESSORS
2485 Natomas Park Dr., Suite 550
Sacramento, CA 95833
Phone: (916) 640-8150
Fax: (916) 640-8156
www.clfp.com