Professional Documents
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Plaintiff
CERTIFICATION OF DAVID HUNTER
v. IN SUPPORT OF THE DEFENDANTS
MOTION TO DISMISS
NEW JERSEY DEPARTMENT
OF ENVIRONMENTAL PROTECTION,
And MATTHEW J. COEFFER, in his
Official capacity as the Custodian of
Government Records,
Defendants.
gas emissions that are demonstrably fair, open, efficient, accountable, and consistent
across national boundaries. IETA has been the leading voice of the business community
on the subject of emissions trading since 2000. Our 155 member companies include some
of North America’s, and the world’s, largest industrial and financial corporations—
including global leaders in oil, electricity, cement, aluminum, chemicals, paper, and
banking; as well as leading firms in the data verification and certification, brokering and
trading, offset project development, legal, and consulting industries. A list of IETA
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3. A number of IETA members have participated in the quarterly RGGI CO2 allowance
auctions.
4. I make this certification in support of New Jersey’s motion to dismiss and brief filed in
request under its public records law seeking disclosure of information related to the first
eight RGGI CO2 auctions, including, a) the names of all bidders, b) the price of each bid,
and c) the quantity and type of CO2 allowance sold to each successful bidder.
6. The purpose of this certification is to demonstrate that the information requested by the
plaintiffs, including the names of bidders, the quantity and price of individual bids, and
7. Releasing such specific information about bidders could adversely affect participants,
facilitate market manipulation, and make regional RGGI allowance auctions less
competitive.
8. Publicly releasing information related to bidding strategy and the quantity and price of
allowances awarded could allow competitors to more accurately estimate a firm’s cost
9. RGGI is unlike any environmental compliance market that is currently operating in the
U.S. or elsewhere, in that the vast majority of allowances are obtained through the
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percent of all RGGI allowances available in the first compliance period (2009 – 2011)
10. In contrast, EPA auctions less than 3 percent of all available SO2 allowances on an annual
basis. The remaining allowances are allocated to covered sources based on historical
emissions. Therefore, the useful market information that is revealed by releasing bidder
information is minimal as compared with releasing the same type of data for RGGI
auctions. Given the relatively small quantity of allowances available, colluding to alter
the Acid Rain Program auction clearing price would also have little or no impact on
11. Under the Acid Rain Program auction, participants are awarded allowances at the price of
their bid instead of at a uniform price as in the RGGI auctions. These two formats result
12. Furthermore, it is acceptable to release data on account holdings for the Acid Rain
Program because these are predominantly determined by historical emissions, which are a
matter of public record. RGGI allowance holdings are based primarily on auction
generation.
13. Even though current and future vintage RGGI allowances have cleared at the auction
reserve price for the past three and five auctions, respectively, market manipulation
remains a real risk given the potential for policy changes that could affect the future
availability of allowances.
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14. The RGGI allowance auctions and RGGI allowance market have functioned adequately
to date with the information provided in the RGGI Market Monitoring Reports and
15. Revealing the bid prices would essentially reveal company specific bidding strategy.
above, if this information were revealed the competitiveness of the auctions would also
be compromised.
16. Revealing the quantity of allowance held by or awarded to each market participants could
place some companies at risk if they fail to purchase enough allowances directly at
17. By publicly releasing both the quantity of allowances held and the total compliance
obligation (emissions), third-parties would know which companies have the greatest need
for allowances. This could provide allowance sellers with the means to employ price
18. If RGGI were to release the price of each bid that each participant submitted in the
19. Each RGGI auction notice explicitly instructs participants not to publicly release
status, bidding strategy, bid price or quantity information, and information related to the
participant’s financial security. Forcing release of this information, even well after the
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20. For the reasons discussed above, the RGGI auction information policy should not be
compared with that of EPA for the Acid Rain Program SO2 allowances auction. A more
are similar to those outlined in the RGGI auction notices. California also intends to
implement a single round, sealed bid auction format, the same type used for RGGI
auctions.
21. Specifically, the California regulations prohibit auction participants from publicly
bidding strategy; bid price or bid quantity information; information on the financial
security it provides to the auction administrator; and other information identified in the
22. Furthermore, the California regulations only permit the state to release the following
information once an auction is complete: the names of bidders, the auction settlement
names of entities that were awarded allowances. These requirements will likely result in
the release of information that is similar to that made publicly available under current
RGGI practice.
23. Releasing additional bidder information would also cause states to violate legislative
or implicitly. Bidding strategy and allowance awards would generally be exempt from
public record laws as a type of confidential business information for the reasons
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discussed above. In addition, the Massachusetts Green Communities Act of 2008
I certify that the foregoing statements made by me are true. I am aware that if any of the
David Hunter
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