California officials held a trial auction to test the state's new system for selling carbon credits today. Starting this November some companies will be required to pay for their pollution emissions as part of California’s greenhouse gas cap-and-trade program.
Many of those companies took part in the test of the auction software. Stanley Young is with the California Air Resources Board, which is running the auction. “What we're trying to do is present the system with a range of challenges by putting in very low bids, high bids, and we're trying to make sure that the system rejects bad bids, and accepts the correct ones," said Young.
The key question will be how the auction sets prices for carbon offsets. Young says the board designed the system to learn from challenges the European Union has faced. There low carbon prices have sometimes been a problem.
Young says so far the trial auction appears to have worked well, and the board will analyze the data over the next week.
