Study Shows RGGI Saves Consumers Money
The Regional Greenhouse Gas Initiative faces an uncertain future in some states. New Jersey plans to end its participation and New Hampshire has considered legislation that would do the same.
But a new analysis shows the carbon dioxide cap and trade program has saved consumers money and created jobs. Under the program, power producers buy pollution allowances at auction for each ton of carbon dioxide they emit.
The money raised in those auctions is spent in different ways among the states – from energy efficiency projects to balancing state budgets.
The Boston-based consulting firm Analysis Group, which conducted the study, found in the first three years the program has added economic value worth more than $1.6 billion to the 10 member states. The figure represents the value of future savings if energy efficiency benefits are realized.
Power plant owners are the big losers in the analysis, spending roughly $912 million since mid-2008.
But states that invested money from allowance auctions in various energy-efficiency projects saw the most economic value, according to Paul Hibbard, Vice President of Analysis Group. "Clearly, in terms of benefit to the economy and benefit to electricity consumers, reinvesting the money in energy-efficiency gives you the biggest bang for your buck," says Hibbard. Hibbard says two-thirds of the money in New Hampshire was used for energy-efficiency.
Hibbard also says the study factors in the effects of the economic recession, when demand for electricity drops.