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City administrator urges pause on CCA action; staff recommends monitoring market linkage before rate changes
Summary
City Administrator Chris Searcy told the Uniontown City Council the Climate Commitment Act market is uncertain and that staff recommends observing whether Washington links to California/Quebec before pursuing local policy or rate changes; council recessed to an executive session to discuss auction bid strategy.
City Administrator Chris Searcy briefed the council May 11 on preliminary projections for compliance costs under the Climate Commitment Act (CCA) and urged caution, recommending that the city monitor market linkage and state reporting before adopting local policy moves that could affect ratepayers.
Searcy said Washington’s auction settlement prices have recently been substantially higher than California’s — citing a recent local auction around $65 per metric ton versus California figures around $30 — and he warned that linkage with California and Quebec could change dynamics. "If the linkage happens and when, it could provide some relief on the prices of those allowances," Searcy said. He noted that Washington is in the first four‑year compliance period and that the state is still several years behind in reporting emissions data that would clarify demand for allowances.
On customer impacts, Searcy presented staff’s modeling showing a range of possible paths: on the low end, if allowance prices align with California, the incremental CCA charge could be modest (staff estimates in the neighborhood of a few‑tenths of a dollar per CCF/therm); on the higher trajectory, costs could rise more steeply if floor prices and program design push allowance prices higher over time. "So that's kind of where we're at currently with that — we think it's a good point to just kinda pause and wait and see what happens with the linkage," Searcy told the council.
Searcy also described the state's allowance price containment reserve and recent rule‑making that shifted a large tranche of allowances into the early compliance period; he said only a small portion of that reserve remains available. Given the uncertainties, staff recommended watching program developments (linkage and Ecology rule‑making) and preparing to assist customers who voluntarily want to lower gas use (for example, incentives that would help a customer move toward a heat pump while retaining gas service). Searcy said staff does not yet seek policy direction to take aggressive action now.
After Searcy’s presentation the council recessed to an executive session to discuss the city’s CCA auction bid strategy (RCW 42.30.11(1)(q)). The council returned and adjourned at 8:03 p.m.
