The Regional Greenhouse Gas Initiative (RGGI) is about to get two new members.
RGGI is a consortium of nine New England and Mid-Atlantic states formed to reduce carbon emissions from large power plants through a cap-and-trade system. The program, which applies to power plants with a capacity of larger than 25 megawatts, establishes a region-wide cap on carbon emissions. Emitters bid in a competitive auction to purchase a permit to emit 1 ton of CO2. They trade in permits when they pollute, or can save unused permits for future use, or sell them to other bidders. States invest the proceeds in energy efficiency or clean energy programs.
The annual cap, which was set originally at 165 megatons of CO2 equivalent in 2008, and adjusted to 91 megatons in 2014, declines by 2.5 percent each year through 2020. The stakeholders are currently negotiating an extension of the program through 2030, which will further reduce CO2.The first new RGGI member, New Jersey, was an original member of the consortium, but Republican Governor Chris Christie withdrew in 2011, and has vetoed several bills since that would rejoin. The incoming governor, Democrat Phil Murphy, has pledged to rejoin.
In more exciting news, Virginia is also moving steadily toward joining the RGGI as well. Gov. Terry McAuliffe issued an executive directive in May directing the Virginia Department of Environmental Quality to develop a rule to limit carbon dioxide from existing power plants. His directive emphasized both designing the rule in such a way to allow Virginia to join a multistate emissions trading group – i.e. the RGGI – AND doing so in such a way that a legislative vote isn’t required.The proposed rule was finished in October and received preliminary approval in November from the state air pollution board. Several hurdles remain, but it is on track for adoption by the end of 2018.
Bringing New Jersey back into the RGGI fold is good news and will reinforce the program’s stability and expand its footprint to cover more carbon emissions -- New Jersey will have the second-largest amount of emissions of any of the current members. However, bringing Virginia into the scheme is extremely promising for several reasons.