cap-and-trade allowances

Allowance distribution in California’s cap-and-trade program (Part II: Industry)

Yesterday I developed a basic overview of the different categories of allowances in California’s GHG trading program. As promised, this post considers the number of allowances that California will freely give to specific industries. Why do we care about industry allowances? First, allowances have value and the Air Resources Board (CARB) has chosen to give …


Allowance distribution in California’s cap-and-trade program (Part I)

Yesterday, I described California’s GHG cap-and-trade auction and the likely constraints on the auction clearing price. Today I want to switch gears to the allowance distribution. As summarized in our recent paper on California’s auction revenue, once you know the number of allowances available at auction and the auction clearing price, you can estimate revenue. …