• 09 Jan 12

  North American carbon markets in 2012

  POINT CARBON ANALYSIS – The WCI will overtake RGGI as America’s largest carbon market in 2012, when two allowance auctions and increased activity in the secondary market make for significant volume growth in our view. The prospect that RGGI’s 2012 review will result in a tighter allowance budget will raise slightly the program’s prices, but we see RGGI’s 2012 auctions clearing under $2/ton as emitters purchase all available allowances. Amid continued risk and uncertainty surrounding purchases of California-eligible offsets, we expect 2012 offset market activity to resemble that of 2011. We forecast a total 2012 North American carbon market volume of 179 Mt, with a value of $782 million. This is roughly double the 2011 volume and value, with the latter increase driven by the WCI’s higher allowance prices.

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