New York and eight other Northeastern states will move to drastically reduce a cap on carbon emissions as part of proposed changes to a regional greenhouse gas program.
The states participating in the Regional Greenhouse Gas Initiative, or RGGI, agreed to seek a reduction in the annual emissions cap from the current 165 million tons to 91 tons starting in 2014. After that, those states proposed reducing the cap by 2.5 percent each year until 2020.
The reduction is aimed at breathing new life in an initiative that first kicked off in 2008. RGGI is a “cap and trade” program, which allows states to auction off carbon allowances to power plants and use the proceeds to fund renewable energy and efficiency programs.
Reducing the cap would likely increase the cost of those carbon allowances, which will likely draw the ire of the state’s various coal plants and business groups.
Gov. Andrew Cuomo’s office privately began seeking changes to the state’s individual cap last year, when in negotiations with lawmakers in June his office sought to lower the emission rate and earmark any additional revenue from carbon auctions for communities that see a power plant close.
At the time, some lawmakers and coal-plant owners had expressed opposition to the proposal, citing concern for the financial impact it may have on the power plants. In September, Senate Energy Chairman George Maziarz, R-Newfane, Niagara County, unveiled his own proposals to change the RGGI program, which included a plan to allow plants to use the money they pay for carbon credits to cover costs for transitioning to cleaner fuels. UPDATE: Cuomo’s plan from last year included a similar provision.
In his State of the State this year, Cuomo publicly unveiled his proposal and urged lawmakers to support it.
In a statement released by RGGI, state Environmental Conservation Commissioner Joseph Martens praised the newly proposed cap.
“Last month, Governor Andrew Cuomo committed to strengthening the RGGI cap to continue reducing the greenhouse gas pollution that is contributing to devastating weather events,” Martens said. “Today’s announcement follows through on that commitment.”
Each of the nine Northeastern states in the RGGI program have to take action to reduce their individual emissions caps. Seven states—including New York—can do it without legislative approval, but lawmakers would likely have to OK any changes to how the carbon-auction revenue is distributed.
Gavin Donohue, president and CEO of the Independent Power Producers of New York, said his group “supports the goal of reducing greenhouse gas emissions from all sectors and the ongoing development of a fair and appropriate national program.”
“We look forward to working with Governor Cuomo’s Administration to ensure that the Regional Greenhouse Gas Initiative’s allowance auction proceeds are invested further to reduce emissions from the power plant sector even more than the significant accomplishments to date through areas such as innovative carbon dioxide abatement methods and renewable and non-carbon dioxide emitting technologies,” Donohue said in a statement.
More reaction from David VanLuven, policy director of Environmental Advocates of New York:
“Given that New York is the most significant polluter in the Northeast, leadership from Governor Cuomo and his administration was critical to making RGGI stronger. And the benefit of that leadership is clear: through 2020, New York could raise $850 million for investment to further reduce carbon pollution, improve energy efficiency, and increase renewable energy generation. Across all nine RGGI states, $2.2 billion may be raised.
“We applaud Governor Cuomo’s leadership in making these reforms a reality, as well as for recognizing that this is just the beginning of an important journey.”