The administrators of California's program have set a floor price for allowances at $10 per metric ton of emissions during the first auction in November.
A market for allowances would automatically respond to changes in economic conditions by adjusting the carbon price, while still maintaining the predetermined emissions cap.
The MP told the Commons on 20 December that he found it "absolutely staggering" that Mr Olisa was a member of IPSA, which oversees members' expenses and upholds standards for allowances.
Power plants that were physically planned and initiated before 2009 could be eligible for allowances, it said, so long as the resulting funds were used to modernise, diversify, and clean up electricity generation.
Offsets could be as cheap as $1 a tonne of carbon for allowances currently trading on the regional greenhouse gas initiative, or for voluntary renewable energy credits, which Microsoft already purchases in large volumes.
At some point, the market price for allowances would reach a level where companies would choose to spend money on actual controls rather than the credits that give them the right to keep polluting.
