The newly-agreed tighter cap of the Regional Greenhouse Gas Initiative (RGGI), starting from 2027, is the result of a years-long review that is now being implemented by the participating states – including Virginia, which officially rejoins the jurisdictional emissions trading system as of July 2026. The new RGGI cap reduces the states’ collective allowance budgets by 86% between 2027 and 2037. These supply constraints, paired with increased demand for allowances due to higher power sector CO2 emissions, make for higher prices in RGGI going forward. Under our base‑case scenario, the price of an allowance (a RGA, already at record high levels) is projected to reach USD 36/st by 2030 and USD 50/st by 2035.