September 20, 2007
Commissioner David Littell
Department of Environmental Protection
17 State House Station
Augusta,
ME 04333-0017
RE: Proposed rules to implement the Regional Greenhouse Gas
Initiative, chapters 156 and 157
Dear Commissioner Littell,
On behalf of Environment
Maine Research
& Policy Center’s
more than 4,000 volunteers and activists, I would like to submit testimony in
support of Maine
implementing the Regional Greenhouse Gas Initiative (RGGI) through the draft
rules proposed by the Department of Environmental Protection (DEP), chapters
156 and 157.
The Environment Maine Research & Policy
Center researches problems, crafts
policy solutions and educates and engages the public on issues that affect Maine’s environment. We
have worked extensively on the issue of global warming, highlighting the
policies necessary to reduce Maine’s
global warming pollution in numerous reports and mobilizing public support for
these policies.
Now more than ever, scientists agree that we must take swift
action to make significant cuts in global warming pollution so that we can
avert the worst effects of global warming pollution. MaineMaine
and our country fail to act, global warming will completely change the face of
the state we love. has already begun to experience global
warming, from rainy winters to northward-spreading diseases to beach erosion
and coastal flooding. If
The historic agreement between the Northeast states embodied
in the Regional Greenhouse Gas Initiative (RGGI) is important for many reasons,
not the least of which is the reductions in global warming pollution from power
plants. Although global warming is a problem of global scale, by banding
together, the Northeast states will be able to address a significant
contribution of the United
States’ total global warming emissions.
According to Environment
Maine Research
& Policy Center’s
recent report, The Carbon Boom, the
states of Maryland, Delaware,
New Jersey, New York,
Connecticut, Rhode Island,
Massachusetts, Vermont,
New Hampshire and Maine released 625.4 million metric tons of
CO2 equivalent in the year 2004, an increase from 577.3 in 1990.
This ranks our ten-state region seventh in the world for total global warming
emissions, beating out Canada
and the United Kingdom.
The increased global warming pollution from power plants over this period of
time accounted for about 37 percent of the total global warming pollution
increase. This clearly debunks the arguments of some detractors of RGGI who
claim that Maine contributes little to the
problem of global warming, or how little this agreement will deal with the
emissions of the United
States. The RGGI region is a significant
contributor of global warming emissions, and by joining with other states, Maine is helping put
more pressure on other states to join, cut emissions or join other alliances in
their region.
The Northeast RGGI
agreement has also set the tone for other regional efforts, and stimulated
other governors to band together to tackle emissions of global warming
pollution. Governors of both the West Coast, and the Rocky Mountain West are
developing collaborations inspired by and pressured by the action of the
Northeast under RGGI. Meanwhile, the Northeast states’ agreement is also
helping drive Congress to act. Implementing RGGI here in Maine will have positive repercussions
beyond our state and beyond our region.
Overall, it is important that the rules promulgated in Maine follow the model
rule development by the Northeast states in order for the regional cap and
trading mechanism to work properly. We would like to offer the following
suggestions for the draft rules that will improve the program and ensure its
best implementation.
On the issue of combined heat and power (CHP) units and
integrated manufacturing facilities (IMF), the law passed by the legislature
indicates that the incentives be given to existing facilities and plants. Using
heat from the generation of electricity, that might otherwise be wasted, for
industrial processes improves the energy efficiency of these facilities and the
state as a whole. Providing an incentive to those existing CHP and IMF
facilities so that they do not have to purchase credits for power that is used
behind the grid goes against the principle of requiring polluters to pay for
the global warming pollution they emit, but these facilities have already
invested in reducing their pollution, so the exception was granted to them.
The legislature set the deadline for CHP and IMF plants to
qualify for the “behind-the-meter” allocation exemption to be prior to the
effective date of the RGGI legislation. The rule does not reflect this
effective date. Allowing new CHP and IMF plants to qualify for the
behind-the-meter exemption could seriously compromise the integrity of the
carbon cap in Maine,
and might cause instability among the RGGI states. Environment MaineResearch & Policy Center is particularly concerned with
this oversight, considering the proposal of the new coal gasification and
diesel manufacturing facility in Wiscasset. In the worst case scenario, this
change from the law to the rule might allow this proposed plant to operate with
a behind-the-meter exemption; it might allow millions of tons of carbon credits
to be handed out at no cost to the plant operator.
A more central concern is the wide powers given to the
Commissioner to waive the requirements of the program. Because this is a
market-based program, it will only work to reduce emissions over time if
emission credits increase in worth and become scarcer. Otherwise, power plant
owners will have no financial incentives to decrease emissions. If the program
can be waived at the first sign of “financial hardship,” which might be
connected to an increase in carbon credit prices, then the program itself will
not function and the state’s emissions from power plants will not decrease. We
would suggest that the program not be allowed to be waived, or if you maintain
the power to waive the requirements, that the test for waiving the program have
a much higher standard. In addition, any such proceedings must include proper
public input and oversight, with full administrative proceedings and judicial
review.
Another area deserving attention is the retirement of carbon
credits for the voluntary purchase of renewable energy credits of entities
within Maine.
By retiring carbon credits from the voluntary purchase of renewable energy, the
rules would ensure the purchaser that the renewable energy was in fact
carbon-neutral. So long as the allocations retired were verified as being
bought by purchasers within the RGGI region and that the renewable energy was
produced within the RGGI region, then that would reduce the budget for the next
allocation year of the state of the purchasers. Although the market for
voluntary renewable energy purchases is small, it would help with the integrity
of the carbon cap and provide further incentives for potential purchasers of
renewable energy and potential renewable energy developers.
I appreciate the opportunity to submit these comments, and I
hope that you are able to amend the proposed rules chapters 156 and 157
appropriately to strengthen the RGGI program and ensure that Maine reduce emissions from power plants.
Sincerely,
Matthew Davis
Organizational Development
Director
