GOP Initiative to Repeal Carbon Market Contributes to Significant Price Drop in Washington State Auction

A GOP-backed ballot initiative to repeal Washington state’s carbon market likely contributed to a sharp drop in prices at the latest auction, with businesses paying $26 per metric ton for carbon emission “allowances” at the February auction, down from $52 last November and a record $63 in August. The cap-and-invest program, which launched last year, requires large companies to buy and submit allowances for any greenhouse gas emissions above a yearly limit, with the revenues funding climate-focused initiatives. In November, voters will decide whether to repeal the 2021 landmark climate law that created the market. If the initiative passes, it is unclear what would mean for already purchased allowances.