US states seeking to join RGGI as part of their plans to meet EPA emission targets must adhere to the northeastern carbon market’s annual goal of a 2.5% carbon cut, officials have agreed.
The emission trajectory is one of five principles states must accept before they can open talks about joining the scheme, Kelly Speakes-Backman, the RGGI board chairman, told InsideEPA/Climate.
Any state that wants to join RGGI must understand what share of RGGI permits it would account for, and how that would impact the overall market, she said.
She said RGGI was not currently discussing expansion with anyone, but that a number of states had made inquiries about joining.
“It seemed clear to us that we needed to develop a set of principles around which we would welcome a state,” she said.”
The five principles are:
– RGGI will continue to cut its emissions 2.5% per year until 2020.
– Newcomers must set up regulatory programme consistent with the RGGI model rule.
– Mutual recognition of permits, making all permits eligible in all participating states.
– A substantial share of permit auction revenue must be invested in projects that benefit consumers, especially energy efficiency and renewable energy.
– Everyone must pay its fair share in implementing the scheme.
President Obama’s goal to cut carbon emissions from power plants to 30% below 2005 levels by 2030 is hotly contested, with thirteen states backing a lawsuit against the EPA plan.
But in the meantime, officials have begun work to prepare plans for how each state will meet their target, due to be submitted to the EPA by mid-2016.
The EPA rules allow states to use market mechanisms, such as trading carbon, renewable or energy efficiency permits, to meet their targets.
Democrat Tom Wolf was elected governor of Pennsylvania last year, promising to bring the coal-reliant state into RGGI, while Washington’s Jay Inslee has introduced legislation that would establish a cap-and-trade scheme in his state, although his plan is facing some difficulties.
Last week, federal and regional EPA officials discussed with dozens of stakeholders how a multi-state market could help accomplishing targets, the fifth such meeting since last April, according to EnergyWire.
By Stian Reklev – stian@carbon-pulse.com
