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Industry News
WASHINGTON ECOLOGY ANNOUNCES CHANGES TO APCR ALLOWANCE SCHEDULE
The Washington Department of Ecology has issued a notice to informing participants of changes in the Allowance Price Con- tainment Reserve (APCR) allowance schedule effective for the remainder of the 2023-2026 compliance period.
These changes are intended to provide additional cost contain- ment for entities required to participate in the cap-and-invest program by ensuring that sufficient allowances are available at a sustainable cost to allow those entities to meet their compli- ance obligations.
The changes, detailed below, are consistent with the approach used in the November 2023 APCR auction.
In November, Department of Ecology Director Laura Watson announced a preliminary decision to seek a linkage agreement between Washington’s cap-and-invest program and the existing joint market between California and Quebec, subject to the requirements set in Washington’s Climate Commitment Act. Because such a linkage agreement is designed to increase the total pool of allowances available, the APCR schedule described in this bulletin will be effective only unless and until a linkage agreement is signed.
WHAT IS THE APCR?
The Allowance Price Containment Reserve, or APCR, is a sep- arate pool of allowances that can be released into the market when increased demand at a quarterly auction pushes prices above a pre-defined trigger price set in rule. This mechanism is designed to ensure businesses can obtain the allowances they need at sustainable, pre-determined prices.
APCR auctions are open only to businesses that are required to obtain allowances to cover their emissions under Washington’s cap-and-invest program. These auctions are not open to inves- tors or other entities without a compliance obligation.
APCR UPDATE – AUCTION SUPPLY GUIDANCE FOR 2023-2026
This notice provides guidance on APCR auctions from 2023 through 2026. Ecology is providing this guidance to clarify market rules in advance of the fourth 2023 quarterly auction scheduled for Dec. 6, 2023:
• Ecology will make the full APCR allowance supply avail- able over the course of the first compliance period.
• The majority of APCR allowances will be made available in 2023 and 2024, provided allowance prices at quarterly
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