Ontario released the results of its third Cap and Trade Program Auction of Greenhouse Gas Allowances, held September 6, on September 13. As with the first two auctions, all available 2017 allowances were sold.
Writing in Aird & Berlis’ Energy Insider blog, David Stevens notes that the auction is remarkable in that, for the first time, all of the future vintage carbon credits also sold out. That stands in contrast to the earlier auctions, where only around half of the future credits were sold.
The price paid for current allowances in the third auction ($18.56) was slightly lower than in the second auction ($18.72). The proceeds from the third Cap and Trade Program Auction of Greenhouse Gas Allowances are around $525 million. This brings the total proceeds from the 2017 auctions to more than $1.5 billion.
Ontario’s fourth (and final) Cap and Trade Program Auction of Greenhouse Gas Allowances for 2017 will be held on November 29, 2017. This may be the final “Ontario-only” auction, given that the Ontario government has announced plans as of 2018 to join the Western Climate Initiative (WCI) auction process that currently includes California and Quebec.
Table 1: Auction Results for September 2017 Ontario Auction #3
| Auction Results | Current 2017 Vintage | Future 2020 Vintage |
| Total Allowances Available for Sale | 25,296,367 | 3,116,700 |
| Total Allowances Sold | 25,296,367 | 3,116,700 |
| Total Qualified Bids Divided by Total Allowances Available | 1.19 | 1.53 |
| Proportion of Allowances Purchased by Capped Participants* | 96.4% | 96.1% |
| Herfindahl-Hirschman Index | 1,361 | 1,788 |
Table 2: Qualified Bid Summary Statistics for September 2017 Ontario Auction #3
| Qualified Bid Summary Statistics | Current 2017 Vintage | Future 2020 Vintage | |
| Ontario Auction Reserve Price (CAD) | $16.79 | $16.79 | |
| Settlement Price (CAD) | $18.56 | $18.03 | |
| Maximum Price (CAD) | $32.84 | $26.69 | |
| Minimum Price (CAD) | $16.79 | $16.79 | |
| Mean Price (CAD) | $21.19 | $20.14 | |
| Median Price (CAD) | $18.50 | $18.36 | |
| Median Allowance Price (CAD) | $20.21 | $18.26 | |
| Auction Exchange Rate | 1.2371 | ||
Excerpted with permission from http://www.airdberlis.com/insights/blogs/energyinsider/post/ei-item/ontario-s-carbon-credit-auction-sells-out-again