The bill amends the Climate Commitment Act to improve auction price containment mechanisms and clarifies the Department of Ecology's authority to adjust rules for better integration with other jurisdictions. It introduces new requirements for the Department to conduct market analysis and economic modeling related to compliance instrument markets, including forecasts on pricing and supply and demand trends. The Department is also mandated to publish these modeling results on its website by specified deadlines, promoting transparency in the climate program's implementation. Additionally, the bill modifies existing regulations on greenhouse gas emissions reporting to minimize reporting burdens while ensuring compliance.

Furthermore, the bill establishes a reserve auction price mechanism to manage allowance price volatility, requiring a percentage of allowances to be set aside in a price containment reserve to mitigate compliance costs during unexpected price surges. It introduces a price ceiling for compliance instruments, initially set at $80 for 2026 and 2027, with provisions for annual increases and adjustments based on linkage agreements. The legislation also creates a price ceiling unit emission reduction investment account to fund emissions reduction projects. Importantly, the bill includes a provision that renders it null and void if specific funding is not provided by a certain date, while ensuring that the remainder of the act remains valid if any part is deemed invalid.

Statutes affected:
Original Bill: 70A.65.150, 70A.65.070, 70A.65.110
Substitute Bill: 70A.65.150, 70A.65.070, 70A.65.110
Second Substitute: 70A.65.150, 70A.65.070, 70A.65.110
Bill as Passed Legislature: 70A.15.2200, 70A.65.010, 70A.65.070, 70A.65.110, 70A.65.160
Session Law: 70A.15.2200, 70A.65.010, 70A.65.070, 70A.65.110, 70A.65.160