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City administrator urges caution on Climate Commitment Act compliance costs; recommends watching linkage and auctions
Summary
City Administrator Chris Searcy briefed council on potential Climate Commitment Act costs to the city's natural-gas utility, noting high Washington auction prices (~$65/metric ton cited in the briefing), uncertainty about linkage to California/Quebec markets, and recommended a watchful approach and preparing customer incentive options rather than immediate aggressive action.
Uniontown — City Administrator Chris Searcy presented an update on the Climate Commitment Act (CCA) and potential impacts on the city’s natural-gas utility at the May 11 meeting, urging the council to monitor rulemaking and market linkage before taking major policy steps.
Presentation highlights: Searcy compared California’s earlier program experience with Washington’s CCA. He said Washington’s auction prices have been "about $65 a metric ton" in recent auctions while California’s auctions were "around 30" (as quoted in the meeting). He showed several charts (as referenced in the staff presentation): projected compliance costs that can rise exponentially over time depending on carbon-price trajectories; customer charges in cents per CCF (Searcy noted current CCA charges are relatively small for older connections but higher for newer connections); and a statewide emissions timeline that showed larger statewide declines but mixed contributions from gas utilities.
Uncertainty and recommended approach: Searcy emphasized uncertainty about market linkage and the amount of allowances available—the state had moved a large portion of its allowance reserve into early compliance periods and only a small portion remains, he said. Because of those uncertainties, and because Washington is several years behind in reporting the emissions covered by the CCA, he recommended a cautious, observational approach rather than immediate policy action: "I think we just sit back and watch, keep, observant and go from there," he said. He also said the council would go into executive session to discuss CCA auction bid strategy.
Why it mattered: The briefing flagged potential upward pressure on natural-gas utility costs for customers if carbon prices remain high or linkage increases demand; it also signaled the city is preparing procedural steps (including executive-session work on bid strategy) while not asking the council for immediate policy direction.
Next steps: Staff will continue to monitor auctions, rulemaking and linkage developments and may return to council with incentive options or policy recommendations if conditions change.
