No-cost allowance allocation

Electric utilities 

No-cost allowance allocation for electric utilities is designed to mitigate the cost burden of the Cap-and-Invest Program and protect electricity consumers. Electric utilities that are subject to the Clean Energy Transformation Act are eligible for allocation of no-cost allowances. No-cost allowance allocation for each electric utility is dependent on forecasts of each utility’s retail electric load and resource supply to estimate the Cap-and-Invest Program cost burden associated with serving Washington retail load.

Electric utilities cannot sell or trade no-cost allowances to other entities. Electric utilities must use no-cost allowances for compliance, save them for future use, transfer them to electrical generation facilities or a federal power marketing administration if eligible, or sell them to quarterly auctions. Electric utilities must use the proceeds from the sale of no-cost allowances at auction to benefit utility customers, with priority given to mitigate any rate impacts to low-income customers.

• Allowance consignment guidance for utilities (offer of no-cost allowances at quarterly auction)

Allowance allocation schedule 

• 2023-2026 allocation schedule (revised Oct. 2024)
• 2023-2026 allocation data set and calculations (revised Oct. 2024)
• Information on allocation adjustments (published Nov. 2024)

Comment on electric utility allocation

Ecology is seeking comments related to electric utility allocation in the Cap-and-Invest Program. While the comment period is open for an extended period of time, we request comments responsive to the April 17 workshop are submitted on May 2, 2025 by 11:59 p.m. Submit electronic comments.

Public meetings and workshops

April 17, 2025, from 1 p.m. to 3 p.m. (register)
Workshop materials will be posted at noon on April 16, 2025, to the Cap-and-Invest Program updates and linkage rulemaking webpage. 

Past events
Oct. 16, 2025: No-cost allowance schedule for electric utilities (Recording of the meeting | presentation) 

Natural gas utilities  

No-cost allowance allocation for natural gas utilities is provided for the benefit and protection of utility customers and must be used to minimize the cost impacts of the Cap-and-Invest Program. The number of no-cost allowances a utility receives is based on its greenhouse gas emissions from 2015-2019 and declines each year proportional to the total Cap-and-Invest Program annual allowance budgets.  

Natural gas utilities cannot sell or trade no-cost allowances to other entities. They must use no-cost allowances for compliance or sell them to quarterly auctions. Natural gas utilities must use the proceeds from the sale of no-cost allowances at auction to benefit utility customers, including at minimum, covering cost impacts to low-income customers from the Cap-and-Invest Program.  

Natural gas utilities are required to sell a percentage of no-cost allowances at auction. In 2023, utilities had to sell 65% of their no-cost allowances at auction. This percentage increases by 5% each year until it reaches 100% in 2030 and stays at that level. 

• Allowance Consignment Guidance for utilities (offer of no-cost allowances at quarterly auction) 

Allowance allocation schedule 

• 2023-2026 allocation schedule
• 2023-2026 allocation data set

Emissions-intensive, trade-exposed industries (EITEs) 

In establishing the CCA, the Legislature recognized that certain industries face unique challenges in reducing their greenhouse gas emissions in the early years of the Cap-and-Invest Program. The Legislature decided to give no-cost allowances to these “emissions-intensive, trade-exposed” industries, or “EITEs,” until at least 2034. 

The baseline for these entities is established using either a “carbon intensity baseline” that determines their average emissions per unit of production during 2015-2019, or a ”mass-based baseline” that is based on their average emissions during 2015-2019.  

 Find more information on how and why no-cost allowances are provided to EITEs on the EITEs webpage.

Allowance allocation schedule 

• Vintage 2023 no-cost allowance allocation
• Vintage 2024 no-cost allowance allocation
• Vintage 2025 no-cost allowance allocation