Offset Pricing Monthly Market Digest – March 2023

by Derek Six | April 7, 2023

Monthly Market Digest March 2023

Offset Supply Information:

All CCOs issued to date: 245.01 million

CA and General Market Commentary:

Issuances of CCOs in March totaled 470,119. The table below continues to track a trend of significantly lower CCO issuances versus prior years:

ClimeCo is a respected global advisor, transaction facilitator, trader, and developer of environmental commodity market products and related solutions. We specialize in voluntary carbon, regulated carbon, renewable energy credits, plastics credits, and regional criteria pollutant trading programs. Complimenting these programs is a team of professionals skilled in providing sustainability program management solutions and developing and financing of GHG abatement and mitigation systems.

For more information or to discuss how ClimeCo can drive value for your organization, contact us at 484.415.0501, info@climeco.com, or through our website climeco.com. Be sure to follow us on LinkedIn, Facebook, Instagram, and Twitter using our handle, @ClimeCo.

Offset Pricing Monthly Market Digest – March 2022

by Derek Six | April 7, 2022

Offset Supply Information:

All CCOs issued to date: 235.92 million

CA and General Market Commentary:

ARB CCO issuances in March accelerated, with 3 million new CCOs issued, but total year-to-date issuances remain well below historic averages. 2.7 million of the 3 million new issuances came from two Alaska-based Improved Forest Management projects.

ClimeCo is a respected global advisor, transaction facilitator, trader, and developer of environmental commodity market products and related services. We specialize in voluntary carbon, regulated carbon, renewable energy credits, plastics credits, and regional criteria pollutant trading programs. Complimenting these programs is a team of professionals skilled in providing sustainability program management services and developing and financing of GHG abatement and mitigation systems.

For more information or to discuss how ClimeCo can drive value for your organization, contact us at 484.415.0501, info@climeco.com, or through our website climeco.com. Be sure to follow us on LinkedIn, Facebook, Instagram, and Twitter using our handle, @ClimeCo.

Offset Pricing Monthly Market Digest – March 2021

Offset Supply Information:

All CCOs issued to date: 219.75 million

Compliance credits awaiting issuance: 11.27 million

CA and General Market Commentary:

On April 1st, ARB announced a new invalidation investigation against the Dairyland Farm LLC digester project. The investigation involves possible regulatory violations at the project during the period 4/1/2018-3/31/2019 and involves up to 30,811 CCOs. This is the third investigation related to regulatory compliance at a dairy project over the past year.
ARB will hold its next quarterly auction on May 19, 2021, with results released May 27th.

ClimeCo is a respected advisor, transaction facilitator, and trader of environmental commodity market products and related services. We specialize in voluntary carbon, regulated carbon, renewable energy credits, plastics credits, and regional criteria pollutant trading programs. Complimenting these programs is a team of professionals skilled in providing sustainability program management services, and developing and financing of GHG abatement and mitigation systems.

For more information or to discuss how ClimeCo can drive value for your organization, contact us at 484.415.0501, info@climeco.com, or through our website climeco.com. Be sure to follow us on LinkedIn, Facebook, Instagram, and Twitter using our handle, @ClimeCo.

Offset Pricing Monthly Market Digest – March 2020

Offset Supply Information:

All CCOs issued to date: 173.29 million
Compliance credits awaiting issuance: 29.38 million

CA and General Market Commentary:

ARB CCA and CCO prices fell precipitously in March as Californians stayed at home and emissions are expected to fall dramatically as a result, at least in the near term. Prices are now approximately $1.40 below the auction floor price for 2020.
Volatility has been extremely high, and the Intercontinental Exchange (ICE) has raised margin requirements for traders several times. Increases in capital required to trade in the CCA market has likely exacerbated the decline below the floor price.
It is important to remember that if allowances go unsold at the next auction in May, which seems likely at this point, then that supply of approximately 66 million allowances being auctioned will be removed from the market for a substantial period of time. The supply of allowances in the market is to some extent self-correcting, so we anticipate futures prices returning to a point at least slightly above the floor within the next few months.

ClimeCo Corporation is a respected project developer, advisor and trader of environmental commodity market products. Specialized expertise in regional criteria pollutant trading programs, California cap‐and‐trade, voluntary markets and project development and financing of internal CO2 abatement systems complement ClimeCo’s diverse commodity portfolio. Within the Climate Action Reserve, ClimeCo is the largest developer of U.S. GHG‐offset projects and producer of U.S. voluntary carbon offsets, managing projects that reduce more than four million tonnes of CO2e per year. For information, contact 484‐415‐0501 or nmarshall@climeco.com.

Offset Pricing Monthly Market Digest – March 2019

Offset Supply Information:

All CCOs issued to date: 151.95 million
Compliance credits awaiting issuance: 18.03 million

CA and General Market Commentary:

ARB issued 6 million new offsets in March and reduced the ROC backlog to 18.03 million, its lowest point in several years.
On April 8^th, the Intercontinental Exchange (ICE; theice.com) listed and traded the first California Carbon Offset futures contract. ClimeCo was pleased to be involved in this historic trade. The contract is for the physical delivery of CCO-0s – offsets whose invalidation period has expired. The first trade was for delivery of CCO-0s in December 2021 and was priced at $16.66. While the contract does not directly provide pricing for the CCO-8s and CCO-3s generated by offset projects today, it does provide a price signal that will be useful for developers and allows a mechanism for hedging offset credits Using the $16.66 trade price, and the April 5^th settlement price of the DEC21V21 allowance futures contract of $19.15, the trade implies a 13% discount for the risk-free CCO-0 versus allowances. It is important to note that this new contract does not distinguish between DEBs and non-DEBs credits (“DEBs” describes credits that qualify as having direct environmental benefits in the state of California. Emitters are limited, from 2021 onward, to a maximum offset usage of 4% for non-DEBs credits).

ClimeCo Corporation is a respected project developer, advisor and trader of environmental commodity market products. Specialized expertise in regional criteria pollutant trading programs, California cap‐and‐trade, voluntary markets and project development and financing of internal CO2 abatement systems complement ClimeCo’s diverse commodity portfolio. Within the Climate Action Reserve, ClimeCo is the largest developer of U.S. GHG‐offset projects and producer of U.S. voluntary carbon offsets, managing projects that reduce more than four million tonnes of CO2e per year. For information, contact 484‐415‐0501 or nmarshall@climeco.com.

Glossary

Offset Pricing Monthly Market Digest – March 2023

Offset Pricing Monthly Market Digest – March 2023

Offset Pricing Monthly Market Digest – March 2022

Offset Pricing Monthly Market Digest – March 2022

Offset Pricing Monthly Market Digest – March 2021

Offset Pricing Monthly Market Digest – March 2021

Offset Pricing Monthly Market Digest – March 2020

Offset Pricing Monthly Market Digest – March 2020

Offset Pricing Monthly Market Digest – March 2019

Offset Pricing Monthly Market Digest – March 2019

Sources

Additional Resources