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 October 2024)
• 2023-2026 allocation data set and calculations (revised October 2024)
• Information on allocation adjustments (published November 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 May 2, 2025, by 11:59 p.m. Submit electronic comments.

Public meetings and workshops

There are no public meetings or workshops scheduled at this time.

Past events

April 17, 2025: No-cost allowance allocation for electric utilities (Recording of the meeting | presentation)
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