This post was co-authored with my colleague Bruce Ho.
Leading U.S. states and regions aren’t standing still as the federal Clean Power Plan (CPP) to cut dangerous carbon pollution from the nation’s power plants winds its way through the courts. Instead, they’re forging ahead with plans of their own, tackling climate change and protecting the health and safety of their citizens—and growing their economies, too.
We’ve seen such efforts in states like Virginia, where Governor Terry McAuliffe recently directed his Secretary of Natural Resources to develop a plan to cut carbon pollution. And we’re continuing to see momentum from the nine Northeastern and Mid-Atlantic states—Connecticut, Delaware, Maine, Maryland, Massachusetts, New Hampshire, New York, Rhode Island, and Vermont—that have been leading the way on climate for the last decade, through the Regional Greenhouse Gas Initiative (RGGI).
RGGI is the country’s first cap-and-invest system designed to reduce power-plant carbon pollution while it creates jobs, cuts consumer energy costs, and improves public health. And since 2009, it’s done all that, slashing emissions in our region by an impressive 37 percent. In order to sustain this progress, the RGGI states are currently reviewing their program and contemplating post-2020 reforms that can build on RGGI’s well-documented successes.
Tomorrow, Tuesday, July 12, at 10 a.m., I’ll be participating on a panel in New York City that will examine how the RGGI states can use this review and program update to cement their climate leadership. In particular, we’ll explore how the RGGI states can align their program with their science-based climate targets (economy-wide greenhouse gas emission reductions of 40 percent by 2030 and 80 percent by 2050), consider ways to expand the program, and beef up its benefits. This workshop is free and open to the public, though advance registration is required, and it’s hosted by an impressive array of organizations: Duke University’s Nicholas Institute for Environmental Policy Solutions, the economics and analysis group Resources for the Future, Georgetown University’s Georgetown Climate Center, and the Collaborative for RGGI Progress, a coalition of environmental groups, including NRDC, and energy companies committed to building on RGGI’s efforts. If you’d like to attend, you can do so by clicking here to register to attend in person or clicking here to register for the livestream. The workshop agenda is available here.
As my fellow panelists and I will discuss tomorrow, the RGGI states have a tremendous opportunity: They can put the region on a sustainable climate path, and lead the nation, by committing to a stronger RGGI program that cuts carbon pollution through 2030.
Here are a few things you should know in advance:
RGGI has already led to substantial economic and environmental benefits.
Along with California’s Global Warming Solutions Act (AB 32), RGGI has been the U.S. climate gold standard. Not only has RGGI helped its participating states cut power plant carbon pollution by more than 37 percent, since 2009 it has generated more than $2.9 billion in economic benefits; produced consumer energy bill savings to date of at least $395 million; created more than 30,000 new job-years of work (a job-year is one year of full-time employment); and provided safer, cleaner air for our kids to breathe, with more than $10 billion in health-cost savings resulting from avoided air pollution.
By committing to further carbon pollution cuts through 2030, the RGGI states can grow these benefits and achieve their state-level climate goals.
The RGGI states recently released modeling results that show significant opportunities to cut carbon pollution from power plants in the region. That’s good (and important) news, because though the states have made substantial progress on their emissions already, they still have a long way to go to reach their economy-wide targets of reducing greenhouse gas emissions by 40 percent by 2030, and at least 80 percent by 2050. Achieving the most ambitious rate of carbon pollution reductions modeled by the states—a reduction through 2030 of 5 percent per year, roughly the amount RGGI has already been cutting annually since 2009—together with other climate policies, could deliver substantial new economic benefits in the RGGI states, according to a recent study by Synapse Energy Economics.
We’re talking here about 58,400 jobs annually, with consumer energy savings worth $25.7 billion through 2030. Moreover, cutting power-plant carbon pollution of 5 percent per year is a least-cost pathway to achieving the RGGI states’ 2030 economy-wide climate goals, Synapse calculated.
Committing to emission reductions through 2030 is important for market certainty.
The states, in their review, have largely focused on emission reduction trajectories through 2030, but recently also presented a possible scenario to extend RGGI’s emission cap only through 2024. Adopting a short-term patch would be a mistake because to maximize the benefits of the program, the RGGI states need to commit not just to significant carbon pollution reductions but also to a clear emissions trajectory that will provide the market certainty that the electric sector needs to plan for the future.
A cap that extends only through 2024 won’t align with the states’ larger climate goals, nor would it meet the terms of the CPP, which has targets that extend through 2030. As noted above, all of the RGGI states have adopted 2030 economy-wide greenhouse gas emission reduction targets. Charting RGGI’s emissions trajectory through that year makes the most sense to improve market efficiency and ensure that states achieve both their own climate policies and the RGGI states’ obligations under the Clean Power Plan.
The RGGI states may be able to grow benefits by expanding their market outside the region, but must do so responsibly to avoid undermining emissions targets.
One of RGGI’s fundamental strengths is its market-based approach to cutting carbon pollution. That approach promotes innovation and provides the flexibility needed to reduce emissions at the lowest cost, all by allowing power plants to trade carbon emissions allowances throughout the region. Under the CPP, the Environmental Protection Agency has given states the ability to adopt RGGI-like approaches across state lines. Given the benefits that RGGI has seen from trading within the nine-state region, it makes sense under the CPP to consider trading with states outside RGGI as well, but only with the right safeguards in place.
Specifically, as I’ve discussed before, RGGI should ensure that prospective trading partners cap carbon pollution from both existing and future power plants. Otherwise, trading could undermine RGGI’s emissions goals by simply shifting electricity generation and associated carbon pollution from existing fossil-fired power plants in the RGGI region to new, unregulated fossil-fired power plants in other states. Covering both new and existing power plants under carbon pollution caps will prevent this problem and is a common-sense approach that the RGGI states themselves adopted from the start.
The RGGI states are on track to meet—and exceed—the EPA’s Clean Power Plan.
The RGGI states are well on their way to meeting their emissions targets under the Clean Power Plan. And though the federal plan is on hold, that hasn’t stopped the RGGI states from moving forward to protect the health and safety of their citizens. According to a proposed schedule that the RGGI states released in June, they hope to agree on a package of RGGI reforms that they can submit to the EPA this fall. If the states commit to the level of carbon pollution reductions needed to meet their 2030 climate goals, they’ll not only secure the benefits noted above, they’ll also meet and exceed the Clean Power Plan’s minimum standards.
With that background, I hope that many of you will be able to participate in tomorrow’s workshop, either in person or online. This workshop comes at a critical point in the RGGI program review, as the states really begin to dig in to the details of how they can move their nation-leading climate program forward while meeting their overall climate goals.
The RGGI states have already proven that cutting carbon pollution and growing our economy can go hand-in-hand. As the science behind climate change becomes ever more urgent, the states’ choice should be simple: it’s time to chart a course to a stronger RGGI program that builds on RGGI’s important successes to date, meets scientifically- and state-mandated climate goals. and, most importantly, promises a safer and more prosperous future for our kids.