The Regional Greenhouse Gas Initiative (RGGI) has now produced enough data to make certain trends abundantly clear: the electric sector is becoming cleaner while the regional economy grows. The nine participating RGGI states, which held their first allowance auction nearly eight years ago, have delivered on their promise of cutting carbon emissions from the region’s power plants. As Acadia Center’s most recent report details, these emissions reductions have been driven, in part, by the steady growth of renewable energy generation and energy efficiency programs. Not only has this transition to a clean energy system helped to curb harmful pollution, it has produced substantial benefits for the regional economy.
Emissions in 2015 continued the downward trend of recent years. Carbon emissions from the power plants covered by RGGI totaled 83.2 million tons in 2015, which was 6.3% below the 2015 emissions cap of 88.7 tons and 37% below emissions levels in 2008, the year before RGGI started. RGGI’s experience continues to show that power sector emissions can be reduced much more quickly and cost effectively than expected.
Fostering a clean energy transition
Energy efficiency programs are reducing demand for electricity across the region, while electricity is increasingly being supplied by renewable energy sources. Both of these trends help to displace electricity generation from aging, inefficient, carbon-intensive sources like coal and oil, while deferring the need to invest in costly natural gas infrastructure. All together, these factors are helping to make electricity in the region cleaner and more affordable.
Increasing Role of Energy Efficiency and Renewable Generation
Both energy efficiency and non-emitting generation are projected to continue increasing in the years ahead. In the nine RGGI states, budgets for electric efficiency programs grew from $575 million in 2008 to $1.9 billion in 2015, an increase of 230%. These efficiency programs are the primary beneficiaries of RGGI revenue, and investments in energy efficiency yield economic benefits on the order of 3 to 4 times the up-front cost. Renewable generation will continue increasing, as all nine RGGI states have Renewable Portfolio Standards that require electric utilities to procure increasing quantities of renewable electricity.
Going forward, many of the RGGI states are increasing commitments to clean energy. Connecticut, Rhode Island, and Massachusetts are procuring significant quantities of hydroelectricity and renewable energy through a joint procurement, and soon-to-be-enacted legislation in Massachusetts will require additional procurements of hydroelectricity, offshore wind, and other renewables equivalent to approximately 30%–40% of the Commonwealth’s electric consumption. New York has committed to a 50% renewable energy supply by 2030, and Rhode Island recently adopted a 40% renewable energy requirement by 2035.
As the RGGI states continue to achieve these increasingly ambitious targets for clean energy growth, the economic and environmental well-being of the region will continue to benefit. New, high-quality jobs will be created in the booming clean energy sector. The region will pay less for the imported fossil fuels needed to power traditional generation. Cleaner air will result in healthier citizens who spend more time at school and work, rather than making costly hospital visits. And last but not least, achieving these goals will enable the RGGI states to meet their own economy-wide GHG targets for 2030 and 2050, doing their share to help avoid the worst impacts of a warming planet.
Stay tuned for Part II of our RGGI report, with the latest on the 2016 program review and the CPP.