Western Climate Initiative Issues Cap-and-Trade Design Plan

The Western Climate Initiative released its plan to institute a GHG emissions cap-and-trade program in January 2012 that would cut 2005 emissions levels 15 percent by 2020, the Associated Press reported. The program would include California, New Mexico, Quebec, Ontario and British Columbia, all of which were preparing their own emissions rules.

Platts reported that the program would auction emissions allowances four times yearly with a single round of bidding and allowances awarded on a lowest winning bid, uniform price basis. Additionally, a reserve price will be set, a reserve of allowances will be made available if prices rise past a specified level, and allowance purchase limits will be applied to prevent market manipulation. The coalition said its design was a "starting point" for members to take part in the cap-and-trade program rather than a "model rule" governing the program.