41,000 Pounds Of Nitrogen Credits Sold At 2nd PennVEST Auction
The PA Infrastructure Investment Authority, working closely with the Department of Environmental Protection and representatives of the Chicago Climate Exchange, held its second auction for nutrient credits on November 4 and 5.
Credits representing the annual removal of 41,000 pounds of nitrogen from the Susquehanna River watershed and the Chesapeake Bay during the next year sold for a price of $2.75 per credit.
The first auction on October 28-29 resulted in the sale of credits representing the annual removal of 21,000 pounds of nitrogen over each of the next three years were sold for a price of $3.04 per credit.
“This auction continues the initial success of the nutrient credit trading program inaugurated in late October,” said Paul Marchetti, PennVEST executive director. “The results of the auction substantiate what we believe will be an important mechanism for helping Pennsylvania address its commitment to improving the waters of the Chesapeake Bay.”
PennVEST is implementing a new initiative to encourage the trading of nutrient credits within the Chesapeake Bay watershed to promote cost-effective solutions to the problem of nitrogen and phosphorous discharges. These nutrients encourage algae growth in the Bay, which ultimately reduces oxygen levels needed by aquatic plants and animals.
PennVEST is encouraging the trading of nutrient credits by acting as a clearinghouse in the credit market. It enters into contracts to both buy and sell credits. By participating in these transactions, PennVEST provides market certainty to both buyers and sellers which, in turn, should help encourage more activity in this market.
Hosting periodic auctions, such as the ones held last week and in October, will be one way in which PENNVEST will facilitate these nutrient credit trades.
Click here for more background on the auction.
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