A new analysis released by the nine Northeast and Mid-Atlantic states in the Regional Greenhouse Gas Initiative (RGGI) projects that electricity bills will fall compared to today’s levels, even as the states fulfill their commitment to cut RGGI’s power plant pollution cap by another 30 percent by 2030. The states will present these findings, as well as additional details on the agreement they reached recently to extend RGGI, in a public stakeholder meeting in Baltimore this afternoon.
Last month, Connecticut, Delaware, Maine, Maryland, Massachusetts, New Hampshire, New York, Rhode Island, and Vermont announced that they will double down on the climate progress they’ve made under RGGI thus far. Their agreement will extend the nation’s first market to cut carbon pollution by another 10 years, and accelerate the pace of RGGI’s carbon reductions.
Extending RGGI is a no-brainer given the program’s impressive track record. Since RGGI launched in 2009, it has helped slash carbon pollution by more than 40 percent while:
- Saving customers $618 million on their energy bills, with billions more expected, thanks to energy efficiency and renewable energy investments funded under the program;
- Providing public health benefits valued at $5.7 billion, by also cutting other dangerous air pollutants like soot and smog alongside carbon;
- Contributing at least $2.9 billion in regional economic growth; and
- Boosting regional employment by more than 30,000 job-years (one year of full-time employment for one person).
As our friends at Acadia Center reported today, since RGGI started, the region’s economy has grown by 30 percent, outpacing non-RGGI states, even as emissions have fallen faster than in other regions. And electricity prices in the RGGI states have fallen by 6.4 percent, even as they increased by 6.2 percent in states outside the region.
RGGI has shown overwhelmingly that with smart policies, we can tackle climate change, create new jobs, grow our economy, and improve public health. In advance of today's meeting, the states have released two new analyses that show these outcomes will continue.
(For more details on the specifics of the states' RGGI agreement, and how it will continue to cut carbon pollution, see our earlier blog post.)
Cutting Carbon Pollution While Paying Less
As NRDC's Jackson Morris and I wrote last month, the RGGI agreement will reduce carbon pollution by at least another 132 million tons—equivalent to avoiding one-year’s worth of emissions from over 25 million cars—by 2030. New modeling for the states by consultant ICF International finds the agreement will reduce pollution even more.
In its analysis of the agreement, ICF projects that emissions between now and 2031 will be 152 million tons lower as a result of the agreement. That’s equivalent to avoiding a year’s worth of emissions from more than 29 million cars, or 4 million more than we estimated last month.
At the same time, customers in the RGGI region are expected to pay much less for electricity. According to electricity bill modeling from the Analysis Group, the average residential electricity bill will be 35 percent lower in 2031 than it is today.
The Analysis Group found only minimal added costs from RGGI, which are more than offset by other factors, resulting in lower bills overall compared to today. For example, residential customers are expected to pay only 14 cents more per month—less than $2 more per year—on electricity bills as a result of the RGGI changes. And despite these costs, the Analysis Group projects that residential customers' bills will nevertheless drop by more than $23 a month from today’s levels, from an average of $67 per month in 2017 to only $44 per month in 2031. Commercial and industrial customers are similarly expected to pay lower electricity bills in the years ahead, as RGGI continues to cut carbon pollution.
The states have only released the Analysis Group's high-level summary of results, but it appears these bill savings are due to energy prices that are expected to remain relatively flat, continued improvements in energy efficiency, which will enable customers to achieve more for less, and direct bill assistance funded by RGGI revenues.
The Analysis Group did not consider many other anticipated outcomes from RGGI, such as job creation, increased state economic growth, and improved public health as a result of reduced air pollution, all of which will further benefit customers.
As NRDC President Rhea Suh said last month, the RGGI agreement shows the world that, despite "the Trump Administration's ongoing attempts to undermine solutions to climate change . . . there are still climate leaders here in the U.S." Just as importantly, the RGGI states' new analyses, and the history of their groundbreaking program, show that acting on climate change isn't just the right thing to do, but is also a major economic opportunity and a win for public health.
Over the next year, as the RGGI states work to formally adopt their new agreement, they also face a new and important climate opportunity. Having charted a course forward for the power sector through 2030, it is now time for the states to address emissions from the transportation sector, which is the largest source of climate pollution in the region. By applying the lessons learned from RGGI over the last decade, the states have the opportunity to develop a transportation climate program that creates cleaner, more efficient, and more sustainable mobility options while providing significant new benefits to communities in every state in the region. The time to tackle this next challenge is now, and NRDC stands ready to help.
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