RGGI Inc conducts quarterly regional auctions which function as the primary market for CO2 allowances. All states participate in these auctions based on their individual program regulations. Maryland's program allows, but does not require, participation in the multi-state auctions. Maryland has participated in all quarterly auctions to date and does not hold any additional auctions outside of this mechanism.
Participation in RGGI auctions is open to all interested parties, including corporations, individuals, non-profit organizations, brokers and environmental advocacy organizations. Eligibility determination includes a thorough review of:
- The Qualification Application,
- Intent to Bid, and
- Financial security assurances of each applicant.
RGGI states approve the qualifications of each applicant. Applicants are also required to disclose both direct and indirect corporate associations and are limited to purchasing a certain percentage of the allowances up for bidding.
How Do the RGGI Auctions Operate?
The auctions operate in a single-round, uniform-price sealed-bid format. Each participant has one opportunity to submit one or more undisclosed bids as well as the quantity of allowances (in multiples of 1,000) that they are willing to purchase at that price.
The bids are then ranked from high to low and allowances are tentatively awarded in this order until cumulative demand is greater than the supply of allowances offered for sale. All allowances are then sold at a clearing price determined by the value of the highest rejected bid.
RGGI Auction Resources
- The RGGI auctions are held quarterly.
- The schedule of auctions is published on the RGGI website.
- The auction notice and other relevant auction materials are published.