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GOP Bill to Remove New Hampshire from Carbon Trading Pact Moves Forward

Environmentalists and business leaders say the bill would forfeit more than $60 million in energy savings and millions more in funding for clean energy

By Maria Gallucci

Feb 21, 2011
New Hampshire state house

Republicans in New Hampshire's legislature took their first step toward withdrawing the state from a regional carbon trading program this month, passing a bill out of committee that advocates say may have enough support to override a potential veto by Gov. John Lynch.

The move is representative of a nationwide trend by newly GOP-dominated state legislatures and governors' seats to repeal climate change and renewable energy policies.

The House Science, Technology and Energy Committee on Feb. 16 voted 13 to 5 along party lines to end New Hampshire's participation in the Regional Greenhouse Gas Initiative (RGGI), a carbon market between 10 Northeast and Mid-Atlantic states and the first mandatory emissions trading plan in the country.

Supporters say the GOP-backed bill, HB 519, would help loosen the pinch on ratepayers' wallets. But opponents, including Republican leaders of clean energy firms, sharply disagree, saying it could end up forfeiting more than $60 million in energy savings and dry up millions more in funding for alternative energy and efficiency programs.

The legislation would lift the requirement that New Hampshire cap carbon dioxide emissions. However, amendments would give the state until the end of the year to exit RGGI and keep the Energy Efficiency and Sustainable Energy Board, which was created in 2008 to run the state's green enery programs, from disbanding.

Any money left over in the state Greenhouse Gas Emissions Reduction Fund that was set up to dispense RGGI revenues would be shifted to a more general energy efficiency programs fund. 

In 2010, the legislature diverted $3.1 million from the RGGI fund to help balance the state's budget. The bill's sponsors have latched onto that as evidence that the scheme isn't helping to reduce greenhouse gas emissions. Instead, they claim it is a "stealth tax" that silently charges ratepayers for higher electricity costs incurred by the program.

"The regional greenhouse gas initiative has simply not impacted the overall reduction of emissions, yet it has had — and will continue to have — a significant negative impact on the economy," said State Rep. Andrew Manuse, the bill's co-sponsor, at the House committee hearing.

Study: RGGI Saved Ratepayers $1.5 Million

RGGI requires power plants in participating states to cap CO2 emissions at 188 million short tons per year through 2014, with additional annual reductions of 2.5 percent from 2015 to 2018. States can sell carbon allowances through auctions and invest the earnings in energy reduction and efficiency programs in businesses, schools and homes, as well in clean energy technologies.

The program was launched in 2005 and held its first quarterly online auction for carbon credits in 2008. New Hampshire, which joined RGGI in June 2008, raised $80.5 million last June in an auction of around 40 million emissions allowances.

2011 evaluation by the University of New Hampshire studied the impact of 30 grants from $17.7 million used for energy programs from June to October 2009, out of a total $28 million in RGGI grants awarded in the state since in 2008. During the first reporting period from July 2009 to June 2010, those grants saved residents and businesses $1.5 million in energy costs and reduced CO2 emissions by 4,600 metric tons.

NH RGGI Press Release

OUT OF STATE OIL AND GAS INTERESTS SPENDING HEAVILY
TO INFLUENCE NH RGGI DEBATE
Concord, NH:  On the eve of a House vote to repeal New Hampshire’s participation in the Regional Greenhouse Gas Initiative, an out of state organization – American’s for Prosperity (AFP) – is spending tens of thousands of dollars in an attempt to influence the outcome of the vote.

AFP, a Washington D.C. based political advocacy group funded by oil and gas interests, is heavily involved in political activities in numerous states aimed at reducing regulation of the industry.  Over the weekend, AFP conducted recorded “robo calls” encouraging people to contact their representatives to vote against the RGGI program. According to their website, AFP is running similar campaigns in other states – most noticeably in New York and New Jersey – against the RGGI program.

“New Hampshire’s energy policy should not be dictated by special interest groups funded by the oil and gas industry," said Jim O'Brien, Executive Director of Conservation NH.  "Our elected officials should be doing what is in the best interests of New Hampshire's economy and environment, not what is in the best interests of out-of-state organizations.”

RGGI is a ten state program aimed at reducing carbon emissions from large fossil fuel power plants.  In New Hampshire, money from the sale of auction allowances are used to help businesses, municipalities and homeowners reduce energy consumption by investing in energy efficiency projects.  Last week, the House Science, Technology and Energy Committee voted 13-5 (along party lines) on controversial legislation to repeal New Hampshire’s participation in the program.   The full House is expected to vote on the repeal Wednesday.

The University of New Hampshire recently released an economic analysis on the RGGI program that shows it is in the economic interest of New Hampshire to remain in RGGI, as the program reduces demand for fossil fuels, creates jobs and keeps money in the New Hampshire economy.

"We trust that members of the New Hampshire House and Senate will think about why out of state money is being used to influence a New Hampshire legislative vote and will ultimately make the right decision to remain in the regional program," concluded O'Brien.

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