Thu February 7, 2013
RGGI Board Recommends Big Carbon Cap Reduction
The nine states that make up the Regional Greenhouse Gas Initiative are recommending reducing the cap on power-plant carbon emissions by 45%. The New Hampshire representative on the RGGI board is Tom Burack commissioner of of the DES.
The low price of natural gas and increased regional investment in energy efficiency have resulted of lower than expected CO2 emissions. Because that the market for carbon allowances has been flooded since 2010, causing them to trade at or near the minimum level. That’s why the RGGI board says the program should lower the cap on carbon, taking allowances out of the market and causing prices to rise. The change would decrease the cap down to the current lower emission levels and then drop by 2.5 percent each year after that.
For that to happen the legislature would have to vote for the change, which Democratic Representative David Borden – chair of the Science, Technology, and Energy Committee – thinks could happen. "I think that there’s much more unanimity regarding RGGI than there has been in the past," he said in a phone interview.
Michael Fitzgerald with the Department of Environmental Services says it might not be much of a choice. "RGGI’s happening all around us; we feel fairly confident that this will move forward in all the states around us," he explains, "If we don’t participate, we will still be paying for it in the price of electricity, as that’s a regional commodity, yet not receiving any of the revenues and benefits."
That would mean the questions that have stymied a repeal of RGGI in the past – namely that we would still see higher energy costs, without getting any of the benefits – could again be pressuring lawmakers. An analysis by RGGI inc – the non-profit that administers the program – estimates that the change could increase electric bills by less than one percent, and decrease CO2 emissions by 45 percent by 2020.