Cap and trade: auction of allowances
Learn how to register and participate in a cap and trade auction.
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You must be registered and approved in the Compliance Instrument Tracking System Service (CITSS) as a mandatory, voluntary or market participant of Ontario's cap and trade program before you can participate in an auction.
Auctions are administered in a sealed-bid format and are held using services by the Western Climate Initiative (WCI). During each auction, all participants submit bids at the same time without seeing others' bids in the online auction platform.
Please email Ontario’s Cap and Trade Help Desk if you would like to register for an upcoming training webinar or if you would like to receive a copy of the training presentation.
Linking the carbon market
On September 22, 2017, Ontario signed a cap and trade linking agreement with Quebec and California. The linking will become effective on January 1, 2018.
Linking the carbon market means that:
- Ontario, Quebec and California will hold joint auctions of allowances
- allowances and credits issued by Ontario, Quebec and California will now be accepted by any of the three cap and trade programs
Annual auction reserve price notice
A public notice establishing the minimum prices for allowances in Ontario, Quebec and California is posted at the end of every year. The minimum prices will be used to establish the auction reserve price for joint auctions that take place during the following year.
Each year a notice will be posted on this web page in December, on the first day that is a business day in all three jurisdictions.
The 2018 annual auction reserve price notice includes information on the:
- minimum prices set by each jurisdiction for calendar year 2018
- approximate number of current and future vintage emission allowances to be offered for sale in 2018
Each notice will also include the proposed schedule of joint auction dates.
The auction reserve price for each joint auction to be held in 2018 will be set the business day before the auction and will be determined as the higher of the minimum prices (i.e. annual auction reserve prices) established in U.S. and Canadian dollars after applying the established Auction Exchange Rate (USD to CAD FX Rate).
Frequency of auctions
Under Ontario's cap and trade regulation, auctions must be held four times each year during the 2017-2020 compliance period.
At least 60 days before a joint auction, a public notice is posted on this web page with:
- the date and time of the joint auction
- a summary of the auction process, including the joint auction schedule
- the number of emissions allowances to be auctioned
Each auction notice will also refer to guidance documentation with detailed instructions on how to participate in the joint auction.
Register for an auction
Once a joint auction notice is posted to this web page, a 30-day auction application period begins.
Applications for permission to participate in upcoming joint auctions and reserve sales (sales) are submitted through CITSS.
Primary Account Representatives (PARs) and Alternate Account Representatives (AARs) of eligible cap and trade participants will be able to submit applications in CITSS for permission to participate in upcoming auction events and sale events.
Participants applying for permission to participate in the joint auction and who retain any consultants that provide advice related to the auction participant’s bidding strategy must submit the Disclosure of Cap and Trade Consultants Form.
For a copy of the Disclosure of Cap and Trade Consultants Form, please email Ontario’s Cap and Trade Help Desk.
For participants submitting a Bid Guarantee in the form of an irrevocable Letter of Credit (LOC), a sample LOC template is now available. For a copy of sample LOC, please email Ontario’s Cap and Trade Help Desk.
To register for an auction, refer to and follow the instructions in the following guidance documents:
- CITSS Auction Registration Guide – provides participants with information on the process that participants must follow in CITSS in order to apply to participate in an upcoming joint auction or sale (updated January 2018).
- Detailed Auction Requirements and Instructions – provides participants with step-by-step instructions about joint auction procedures and requirements (updated December 21, 2017)
- Auction Examples – provides information on how auction bidding limits are applied, how auctions are settled, and how to calculate the amount of bid guarantee to submit (updated December 21, 2017)
Two reports will be posted following each joint auction.
An Auction Summary Results Report will be posted on this web page no later than 45 days after an auction.
The Post-Auction Public Proceeds Report provides a final summary of auction proceeds. It confirms that:
- all qualified bidders have paid for their successful bids
- the money has been transferred to the province
- carbon allowances have been transferred to the CITSS accounts of successful bidders
If you have questions or need help registering for an auction, contact Ontario's Cap and Trade Help Desk, Monday to Friday, 8:30 a.m. to 5 p.m. by:
Previous auction information and results
Read the Auction Notices, Summary Results Reports and Public Proceeds Reports for every Ontario cap and trade auction of greenhouse gas allowances.