RGGI Carbon Auction Clears at Record High, Generates $1 Billion

The Regional Greenhouse Gas Initiative on Sep. 11 announced that its latest carbon allowance auction generated $1 billion, highlighting continued strength in the Northeast’s cap-and-trade market as Virginia resumed participation after rejoining the program in July.

The program’s 73rd carbon allowance auction cleared at $37.65 per allowance, with nearly 29 million allowances sold, including additional permits released through the program’s cost-control mechanism. Virginia contributed about 6 million allowances to the offering following its return on July 1, 2026, increasing overall supply while demand remained strong enough to push prices to a new high.

The latest auction marked a notable increase from the previous sale in June, when allowances cleared at $35 each. The clearing price rose by about 8 percent, while auction proceeds climbed from $642 million to $1 billion, reflecting both higher prices and a larger volume of allowances sold. The stronger outcome suggests compliance demand has remained resilient despite the expanded supply entering the market.

States will reinvest the auction proceeds into energy efficiency, renewable energy, beneficial electrification, utility bill assistance, and greenhouse gas reduction programs. The auction also sold all 1 million available Cost Containment Reserve allowances, exhausting the reserve for the remainder of 2026 and leaving no additional reserve allowances available for the next auction scheduled for Dec. 2, 2026.

Meanwhile, the Emissions Containment Reserve, which removes allowances from the market when prices fall below a predetermined threshold, remained inactive because auction prices stayed well above the trigger level. Participating states also supplemented the latest sale with about 4 million additional set-aside allowances and expect to offer roughly 2 million more during the December auction as regulators continue managing allowance supply.

The latest results came as utilities and other regulated entities prepare to meet emissions obligations under the sixth compliance period. Alongside the auction outcome, the initiative’s independent market monitor released an updated assessment of allowance supply and demand to help market participants evaluate future compliance needs while supporting long-term investment in clean energy and emissions reduction initiatives.