California Holds Practice Auction For Its Cap-and-Trade Program
By KEVIN POLONCARZ & MICHAEL BALSTER
The California Air Resources Board (CARB) conducted a practice auction for the states landmark cap-and-trade program today, August 30, 2012. The practice auction provided a dress rehearsal for CARB, covered entities and other market participants to test the auction platform in preparation for the first real auction under the cap-and-trade program, which is scheduled for November 14, 2012. While CARB will not be releasing the auction result (i.e., clearing price), to avoid sending false price signals to the active market in forward contracts for California Carbon Allowances (CCAs), this event marks another important milestone in Californias establishment of an economy-wide cap-and-trade program, since the passage of the California Global Warming Solutions Act (AB 32) nearly six years ago.