On Wednesday, February 28, 2018, Ontario announced the results of the first joint Ontario, Quebec, California auction of greenhouse gas emission allowances, held February 21, 2018.
A total of 98,215,920 current (2016 and 2018 vintage) greenhouse gas emission allowances were sold at a settlement price of $18.44 CAD, and a total of 8,576,000 future (2021 vintage) allowances were sold at a settlement price of $18.34 CAD. The auction generated estimated proceeds to Ontario in the order of $471 million, which by law will be invested in programs that will reduce greenhouse gas pollution and help families and businesses reduce their own emissions through the Climate Change Action Plan.
In the linked market, actual auction proceeds are calculated and reported in a post-auction proceeds report issued by each jurisdiction. The proceeds reports for the February auction will be posted on March 20, 2018.
By law, all proceeds Ontario receives from the auction will be invested in programs that help families and businesses reduce their greenhouse gas pollution through the Climate Change Action Plan.
The auction was administered by the Ontario Ministry of the Environment and Climate Change, the Quebec Ministère du Développement durable de l’Environnement et de la Lutte contre les changements climatiques and the California Air Resources Board, using services contracted by the Western Climate Initiative (WCI) Inc., with oversight from an independent market monitor to ensure the integrity of the process.
The summary report of the results has been made available to the public.
Making it easier and more affordable for people to fight climate change at home is part of Ontario’s plan to create fairness and opportunity during this period of rapid economic change. The plan includes a higher minimum wage and better working conditions, free tuition for hundreds of thousands of students, easier access to affordable child care, and free prescription drugs for everyone under 25 through the biggest expansion of medicare in a generation.
- On May 18, 2016, Ontario passed landmark climate change legislation that ensures the province is accountable for responsibly and transparently investing proceeds from the cap and trade program.
- The Climate Change Action Plan and the cap and trade program form the backbone of Ontario’s strategy to cut greenhouse gas pollution to 15 per cent below 1990 levels by 2020.
- On September 22, 2017, Ontario signed a cap and trade linking agreement with Quebec and California. The linkage took effect on January 1, 2018.
- While this is the first joint auction that includes Ontario, it is the 14th joint auction for Quebec and California.
- After introducing its cap and trade program and putting a price on carbon, California’s economy grew at a pace that exceeded the growth of the rest of the U.S. economy.
- The number of jobs in California grew by almost 3.3 per cent in the first year and a half of the program, outstripping the national rate of job creation, which was 2.5 per cent over the same period.