RGGI Auction Prices Rebound in Response to Proposed Changes
BOSTON — Prices increased in the first Regional Greenhouse Gas Initiative (RGGI) auction since the participating states proposed a set of changes to the program. This is an initial indication that the market expects the program to be stronger in the future. All 14,371,585 available allowances were sold at a clearing price of $4.35, generating $62,516,395 in revenue for reinvestment. This brings the program’s total revenue to $2.78 billion—most of which has been used to fund energy efficiency and other consumer benefit programs. The Auction 37 clearing price is 72% higher than the previous auction and 4% lower than the clearing price from one year ago. This marks an end to the steady decline in auction clearing prices that began in early 2016.
The key changes announced by the states include:
- Reducing the emissions cap by 30% from 2020 to 2030;
- Conducting a full adjustment for banked allowances;
- Strengthening the existing Cost Containment Reserve; and
- Establishing an Emissions Containment Reserve
“We applaud the RGGI states for working together to improve the program, and the Auction 37 results show that these changes should make RGGI stronger,” said Acadia Center President Daniel Sosland. “After nearly two years of negotiations, the states have put RGGI on a course for long-term success.”
“Proposed policy changes have driven prices upward in this auction, but implementing RGGI reforms is the only way to ensure that prices won’t dive again,” said Jordan Stutt, Policy Analyst with Acadia Center. “Emissions continue to fall rapidly—each of the first two quarters in 2017 resulted in record low quarterly emissions—and even the new cap may not decline quickly enough to keep up with decarbonization in the electric sector. Fortunately, the new addition of an Emissions Containment Reserve should help the states reduce emissions further, at low costs to consumers.”
“The increase in allowance prices is a testament to the leadership of the RGGI states,” said Peter Shattuck, Director of Acadia Center’s Clean Energy Initiative. “By following through on proposed reforms, the nine RGGI states can demonstrate the power of bipartisan action to address climate change.”
Information on RGGI’s performance to date can be found in Acadia Center’s latest RGGI Status Report:
Additional information on the benefits of RGGI can be found at https://www.cleanenergyeconomy.us/
RGGI Overview:
The Regional Greenhouse Gas Initiative (RGGI) is the first mandatory, market-based effort in the United States to reduce greenhouse gas emissions. Nine northeastern and mid-Atlantic states reduce CO2 emissions by setting an overall limit on emissions “allowances,” which permit power plants to dispose of CO2 in the atmosphere. States sell allowances through auctions and invest proceeds in consumer benefit programs: energy efficiency, renewable energy, and other programs.
The official RGGI web site is: www.rggi.org
Media Contacts:
Jordan Stutt, Policy Analyst, Clean Energy Initiative
jstutt@acadiacenter.org, 617-742-0054 x105
Peter Shattuck, Director, Clean Energy Initiative
pshattuck@acadiacenter.org, 617-742-0054 x103
Green groups push CT for more ambitious renewable standards
Two dozen officials from groups like Connecticut Fund for the Environment, Acadia Center, Sierra Club, CT Roundtable on Climate & Jobs and Connecticut Citizen Action Group signed a letter delivered to DEEP ahead of its Thursday afternoon public hearing on the draft Comprehensive Energy Strategy (CES), released last month.
Read the full article from the Hartford Business Journal here.
Massachusetts Joins Other States in Regional Greenhouse Gas Initiative Announcing Plan to Reduce Emissions by Additional 30 Percent over 2020 Levels
The consortium has been lauded for its success in achieving carbon dioxide emissions reductions and extensive investment in clean energy technology. A 2016 report by the Acadia Center found RGGI states reduced emissions by 16 percent more than other states while energy prices fell by an average of 3.4 percent. The regional permit auctions have generated more than $2.7 billion in proceeds used to build a cleaner energy system, and healthcare cost savings from emissions reductions are estimated to be nearly $6 billion.
Read the full article from The National Law Review here.
Proposed State Energy Strategy Draws Critics
A group of 24 energy and environmental groups submitted a letter to state officials in advance of Wednesday’s public hearing detailing their fears that the new plan falls short of what is needed to achieve Connecticut’s energy goals.
[…]
The coalition protesting different aspects of the proposed energy strategy includes the Connecticut Fund for the Environment, Acadia Center, and Clean Water Action. Among the other organizations signing on to the letter were the Connecticut Sierra Club, Solar Connecticut Inc., the Connecticut Citizens Action Group, and the Connecticut League of Conservation Voters.
Read the full article from the Hartford Courant here.
Low Lily fan-funds full-length album
“We open it up to YOU to preorder the CD, and maybe consider donating more, selecting one of the many enticing rewards we have come up with to make this extra fun, and — we hope — mutually beneficial.
“In addition to being artists, we are also dedicated citizens of our world, and we love to support organizations who we feel are doing great things for the sustainability of our planet. Therefore we will be donating 5% of all money we raise to the Acadia Center, based here in the northeast. We like the Acadia Center, as they spend time and money on real, practical solutions to tackle the very pressing environmental issues locally.”
Read the full article from The Commons here.
No. 1 on Our List of Back to School Supplies: Electric School Buses
The beginning of September signifies the beginning of the school year for many students. Across the country, 26 million, or over half of school-aged children are transported by 480,000 school buses.1 In an average school year, each bus travels about 12,000 miles, using 1,714 gallons of diesel fuel2 and producing about 17 MMT of CO2 emissions,3 as well as other harmful emissions such as nitrogen oxides and particulate matter. Electric school buses offer a viable alternative to diesel buses, and offer a solution to the health and environmental impacts of burning diesel fuel.
A relatively new option, electric school buses are being tested in early-stage pilot programs in both California and Massachusetts. The growing interest in electric school bus deployment is evident in the increase of funding opportunities for ZEV school buses: Blue Bird, a major school bus manufacturer, is the recipient of a grant to manufacture new electric bus models;4 three school districts in Sacramento, California, received a grant for an electric school bus pilot with funds from their cap-and-trade program;5 and the Massachusetts Department of Energy Resources awarded grants to four districts participating in an electric school bus Vehicle-to-Grid (V2G) pilot program.6 
The Massachusetts pilot is of particular interest, as it seeks to demonstrate the feasibility of incorporating V2G technology, through which the electric school buses connect to the grid while not in use, allowing for two-way charging and battery storage. Because most school buses are in use for about 5 hours each weekday on predictable schedules, they are good candidates for V2G for battery storage and improved management of grid-level supply and demand.7
Current acquisition costs for electric school buses are between $250,000 to $300,000—roughly $100,000 to$120,000 more than a diesel school bus. However, the use of electricity to power the buses would displace significant fuel costs over the vehicle’s lifetime. For example, an electric school bus pilot in California is expected to save the host school district $10,000 annually in fuel and maintenance costs.8 There are also a number of potential funding sources to assist with the upfront purchase cost, including funding from the Diesel Emissions Reduction Act, Volkswagen Settlement Funds, and state programs such as California’s vouchers through the Hybrid and Zero-Emission Truck and Bus Voucher Incentive Program. Prices for batteries are expected to decline significantly in the future, too, especially as demand increases. A study through the California Air Resources Board (CARB) indicated a possible 41% reduction in battery price based on an increase from 300 to 10,000 battery systems produced per year.9
Electric school buses are an interesting alternative to diesel and are on a path to become an increasingly beneficial clean energy technology. As the electric school bus market develops, the financial feasibility of electric buses will continue to grow, and more information about the successes and limitations of electric school buses will become available as pilot programs mature.
1 http://www.americanschoolbuscouncil.org/issues/environmental-benefits
2 http://www.americanschoolbuscouncil.org/issues/environmental-benefits
3 https://nnsa.energy.gov/sites/default/files/nnsa/08-14-multiplefiles/DOE%202012.pdf
4 https://www.blue-bird.com/blue-bird/Press-Releases/Blue-Bird-Awarded-44-Million-to-Develop-Electric-S-95.aspx
5 http://stnonline.com/news/latest-news/item/8613-largest-us-electric-school-bus-pilot-comes-to-california
6 http://www.mass.gov/eea/pr-2016/electric-school-bus-grants-to-four-schools.html
7 http://www.schoolbusfleet.com/article/713421/can-electric-school-buses-go-the-distance
8 https://motivps.com/americas-only-all-electric-school-bus-transports-students-saving-california-school-district-over-10000-a-year-in-fuel-and-maintenance-march-3-2014/
9 https://www.arb.ca.gov/msprog/bus/battery_cost.pdf
The Climate Post: Harvey Shines Light on Issue of Climate Change
Program advocates point to several studies suggesting the program’s success, reported the Boston Globe. One by the Acadia Center in 2016 found that RGGI states reduced emissions by 16 percent more than other states, while growing the region’s economy 3.6 percent more than the rest of the country. At the same time, energy prices in RGGI states fell by an average of 3.4 percent, while electricity rates in other states rose by 7.2 percent.
States Dare to Think Big on Climate Change
Even as emissions have come down, electricity rates have fallen by an average of 3.4 percent in the nine states, according to the Acadia Center, an energy research and advocacy organization. And the economies of the nine states have grown faster than the economy of the rest of the country.
Read the full editorial at The New York Times here
Our Opinion: Massachusetts allies make it easier to breathe
While a number of environmental groups had advocated for deeper emissions reductions over the past year, all expressed support of the agreement, with Peter Shattuck, director of the Acadia Center, a Boston-based advocacy group, telling The Boston Globe “This is what climate leadership looks like.” Significantly, the New England Power Generators Association (NEPGA), which has opposed emissions reduction mandates for not considering the burden on its members, praised the new agreement, as it has the RGGI in general. “Market-based programs provide the most efficient, competitive, and lowest-risk way to address climate change,” said NEPGA President Dan Dolan in The Globe.
[…]
The Acadia Club [sic] has found that RGGI states have reduced their emissions by 16 percent more than other states while seeing economic growth of 3.6 percent more than those states. Energy prices fell by an average of 3.4 percent while rising by an average of 7.2 percent in non-RGGI states. Those numbers are backed by the Sierra Club and other environmental organizations. The Cambridge, Ma.-based consulting group Abt Associates said in The Globe that it estimates the the RGGI has resulted in the saving of as many as 800 lives, reduced asthma attacks by bout 8,000 and saved as much as $6 billion in health care costs.
Read the full editorial from the Berkshire Eagle here.
Chris Christie Has Plenty to Be Embarrassed About, But This One Really Matters
Contrary to what Christie said in 2011, New Jersey has lost money as a result of exiting RGGI. The state lost out on $130 million in proceeds from auctions where RGGI sells emissions permits and could miss out on another $359 million by the end of 2020 if it doesn’t rejoin, according to estimates by the Acadia Center think tank. If the sum of that money were invested in energy efficiency programs, as RGGI is designed to facilitate, New Jersey would save 15.3 million megawatt hours of electricity, more than all the power produced by the state’s coal-fired plants from 2010 to 2012.
[…]
The nine remaining states are deciding between three different options to ramp up the rate at which RGGI reduces emissions. But the states are split between those who want the most ambitious target, such as New York and Massachusetts, and those that want the more modest choice, including Maine and New Hampshire. The difference in cost between the most and least ambitious targets comes out to less than one-tenth of one penny more per kilowatt hour of electricity over the current standard, yet the impact would be huge. Choosing the most aggressive reduction rate would avoid 99 million short tons of carbon dioxide emissions, according to the Acadia Center.
Read the full article from Mother Jones here.