California's Cap and Trade Program – Lessons Learned and Results from the November Auction
Join AWMA for dinner and speaker presentations at the offices of Wendel, Rosen, Black & Dean LLP in Oakland to learn more about this first Auction from the perspective of participating industry experts and financial market players.
The speakers will cover auction process, logistics, carbon pricing, the reaction of the markets and various industries, and the motivation behind the legal challenge filed by the California Chamber of Commerce, as well as the implications for future auctions and markets. We will leave ample time for Q&A from the audience.
Pursuant to AB 32, implementing regulations for California's cap and trade were adopted on December 13, 2011. They are contained in Article 5: "California Cap on Greenhouse Gas Emissions and Market-Based Compliance Mechanisms."
After several postponements, and in the face of a last-minute legal challenge, on November 14, 2012 the Air Resources Board conducted the first auction of allowances for the first compliance period starting on January 1, 2013 and for vintage year 2015.
Those affected by the program include electricity generators, carbon dioxide suppliers, petroleum and natural gas facilities and large industrial sources that emit 25,000 metric tons of CO2 (equivalent) per year or more. On November 13th, the California Chamber of Commerce filed a lawsuit challenging certain provisions of ARB's cap-and-trade program.
- Jonathan Redding, Partner, Wendel, Rosen, Black & Dean, LLP
- Brad Neff – Brad Neff is Manager of AB 32 Cap and Trade Implementation for PG&E. Brad's responsibilities at PG&E include coordinating the overall cap and trade implementation effort—including regulatory affairs, market readiness, and customer impact. Brad graduated top of his class from the University of Utah in both Finance and Economics. Brad also holds an MBA from HEC Paris where he was the president of the Sustainability Club and developed a renewable energy business plan for EDF's green energy services group. He will be introducing the basics of the Auction process and PG&E's perspective on cap and trade.
- Loren Kaye – Loren Kaye is President of the California Foundation for Commerce and Education, an affiliate of the California Chamber of Commerce, and a Gubernatorial appointee to the Little Hoover Commission. Prior to joining the Foundation in 2006, Loren served in senior policy positions for Governors Pete Wilson and George Deukmejian, including Cabinet Secretary to the Governor and Undersecretary of the California Trade and Commerce Agency. He will speak on the motivations for and reasons why the Chamber of Commerce opposes the auction and filed the lawsuit. In short, the lawsuit does not challenge any of the provisions of AB 32 nor the merits of climate change science. The only issue addressed in the litigation is the portion of CARB's regulatory program that seeks to permit the Board to allocate to itself GHG emissions allowances and to profit by selling them to GHG emitters.
- Dusty Granet – Dusty is a Broker with BGC Environmental Brokerage Services L.P. (BGC). He joined BGC in January 2012 from Evolution Markets where he spent three years advising the environmental marketplace on California emissions and U.S. water markets. He will be speaking about pre action and post auction carbon pricing and market reactions on the process and the pricing; options within the secondary market for future transactions involving allowances and offsets; and how to minimize risks through the OTC market.