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Regional Greenhouse Gas Initiative

an initiative of the Northeast and Mid-Atlantic States of the U.S.

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Program Overview

> The RGGI CO Cap

Regulated Sources

Allowance Allocation

State Statutes & 

Regulations

2012 Program Review

Program Design Archive

The RGGI CO Cap 

The RGGI CO cap represents a regional budget for CO emissions from the power sector. A CO allowance 

represents a limited authorization to emit one short ton of CO from a regulated source, as issued by a participating 

state.

Following a comprehensive 2012 Program Review, the nine RGGI states implemented a new 2014 RGGI cap of 91 

million short tons. The RGGI cap then declines 2.5 percent each year from 2015 to 2020.

The RGGI states include two interim adjustments to the RGGI cap to account for banked CO allowances. The first –

the First Control Period Interim Adjustment for Banked Allowances – is a reduction to the RGGI cap equivalent to the 

private bank of first control period (2009-2011) CO allowances. The adjustment is applied to each state's annual CO

allowance budget for 2014-2020.

The second – the Second Control Period Interim Adjustment for Banked Allowances – is a reduction to the RGGI cap 

equivalent to the private bank of CO allowances for CO allowance allocation years 2012 and 2013 that are in 

addition to the total quantity of 2012 and 2013 CO emissions. The adjustment is applied to each state's annual CO

allowance budget for 2015-2020.

The first control period adjustment is 57.4 million CO allowances for 2014-2020. The second control period 

adjustment is 82.1 million CO allowances for 2015-2020.

The RGGI cap and RGGI adjusted cap for the years 2014-2020 are as follows:

2014: RGGI cap is 91,000,000, RGGI adjusted cap is 82,792,336

2015: RGGI cap is 88,725,000, RGGI adjusted cap is 66,833,592

2016: RGGI cap is 86,506,875, RGGI adjusted cap is 64,615,467

2017: RGGI cap is 84,344,203, RGGI adjusted cap is 62,452,795

2018: RGGI cap is 82,235,598, RGGI adjusted cap is 60,344,190

2019: RGGI cap is 80,179,708, RGGI adjusted cap is 58,288,301

2020: RGGI cap is 78,175,215, RGGI adjusted cap is 56,283,807

In addition, New Jersey sold 279,758 CO allowance allocation year 2014 CO allowances in 2011, and an estimated 

180,894 CO allowances for CO allowance allocation years 2012 and 2013 in state set aside accounts will be 

distributed or auctioned after the second control period interim adjustment.

For additional information, see the First Control Period Interim Adjustment for Banked Allowances Announcement

and the Second Control Period Interim Adjustment for Banked Allowances Announcement.

From 2009-2011, the cap was 188 million short tons per year for the ten-state region (Connecticut, Delaware, Maine, 

Maryland, Massachusetts, New Hampshire, New Jersey, New York, Rhode Island, and Vermont).

From 2012-2013, the cap was 165 million short tons per year for the nine-state region (Connecticut, Delaware, 

Maine, Maryland, Massachusetts, New Hampshire, New York, Rhode Island, and Vermont).

Cost Containment Reserve

The RGGI states have also established a Cost Containment Reserve (CCR) of CO allowances that creates a fixed 

additional supply of CO allowances that are only available for sale if CO allowance prices exceed certain price 

levels – $4 in 2014, $6 in 2015, $8 in 2016, and $10 in 2017, rising by 2.5 percent each year thereafter.

The CCR is replenished at the start of each calendar year. The CCR is 5 million CO allowances in 2014 and 10 

million CO allowances each year thereafter. For additional information on the CCR see Auction Materials.

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Regional Greenhouse Gas Initiative (RGGI) CO2 Budget Trading Program - The RGGI C... Page 1 of 1

http://www.rggi.org/design/overview/cap 6/9/2014