With the passage of Assembly Bill (AB) 32 in 2006, the California Air Resources Board was tasked with developing a flagship cap and trade program that promises to redefine carbon reduction in North America. The program will start in 2013, with the first Allowance auction set for August 2012. The program will be the largest in North America, covering 80% of the California’s emissions. The trans regional Western Climate Initiative (“WCI”) is being developed in tandem with California, and will result in a dynamic and integrated North American carbon market.
The California carbon market and the WCI are focal points of Karbone’s strategic vision. The firm brings a team of seasoned professionals with extensive transactional experience in the environmental credit markets both in North American and with allowances markets associated with the European Union Emissions Trading System (EU ETS). The desk will provide execution-based services and advisory based client specific hedging programs to assist all stakeholders in these markets.
Experience and Established Presence
Karbone is well positioned to utilize its established presence in Western North American Markets to add value to its clients in California and the WCI. The Western Markets desk has a proven track record of structuring renewable power and renewable energy credit contracts within California and the greater WECC region. Building upon these relationships and its knowledge of power market dynamics, Karbone is able to assist in structuring hedging solutions for power market participants assigned with carbon liabilities.
Karbone’s ability to negotiate PPAs is vital in assisting both RPS obligated parties and IPPs to fulfill their commercial objectives As a value-added aspect of this service, Karbone’s Brokerage team builds upon the expertise of its Capital Advisory group to negotiate PPAs that address the financing requirements of lenders. Much the same, Karbone is able to leverage its Research group to provide market insight to assist load-serving entities in addressing their RPS obligations.