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Greenhouse Gas Initiative

CONCORD, NH (AP) - New Hampshire became the 10th state to participate in a regional effort to cut greenhouse gas emissions.

Gov. John Lynch signed a law to implement the Regional Greenhouse Gas Initiative known as RGGI. New Hampshire will revisit the issue if Congress enacts a federal program. The law took effect immediately.

“ With this legislation we are taking a major step forward in protecting our economy and our natural resources by reducing pollution and increasing energy efficiency,” said Lynch. “Pollution and climate change threaten our state’s environment, our health and our economy.”

The law adds New Hampshire to the other New England states, New York, New Jersey, Delaware and Maryland in a market-based, “cap and trade” program to reduce carbon dioxide emissions from the region’s power plants.

Lynch believes joining RGGI will allow New Hampshire to cut the emissions that contribute to global climate change, increase energy efficiency and ultimately help consumers save on energy costs.

“ If global warming is left unchecked, our grandchildren could be living in a much warmer climate,” he said.

Lynch said a warmer New Hampshire would affect the environment which, in turn, could hurt tourism - a major economic engine in the state.

“ I believe strongly there should be national action and a national energy policy that addresses these issues,” he said. “But I also do not believe that New Hampshire can afford to wait for national action.”

“ This program will serve as a catalyst for additional regional and national action,” predicted Daryl Burtnett, state director of The Nature Conservancy.

The governors of the 10 states signed a memorandum of understanding agreeing to the initiative. It is a regional plan, but each state must adopt its own laws and regulations.

Under RGGI, a regional carbon dioxide emissions cap will be put in place for large fossil fuel-fired power plants beginning in 2009. Allowances will be issued equal to the total cap and apportioned to the participating states.

Utilities would have to buy enough allowances within three years to cover their emissions. Since the number of allowances is limited by the regional cap, overall emissions are expected to be reduced.

The money utilities pay for the allowances would go into a state-regulated fund to improve energy efficiency. Money from the sale of allowances above a certain threshold would go back to electric ratepayers.

Critics said RGGI unfairly shifts costs onto ratepayers, especially businesses. Businesses wanted a lower threshold than either the House or Senate proposed, while environmental groups wanted a high threshold to build a bigger fund.

The House proposed an initial threshold of $12 per ton while the Senate set its 2009 mark at $6 per ton - which the House accepted and Lynch signed into law. Business groups had wanted the mark set at $2 per ton. The threshold rises over time in both versions to 2015. After 2015, all proceeds go into the fund.

Other types of allowances also are part of the plan. For example, capturing methane gas at a landfill also reduces carbon emissions. Also under consideration is using forestry management to reduce carbon emissions through techniques as simple as planting trees.

State environmental officials envision a wide range of uses for the money that include cooling and heating efficiencies. For example, money could be used to help insulate homes or to buy wood stoves or more efficient furnaces.

Wal-Mart Inc.’s Concord store supplied energy-efficient compact fluorescent light bulbs that Granite State Conservation voters distributed to people at the bill signing to highlight the importance of reducing demand for power.

New Hampshire’s electric users would have paid higher rates regardless of New Hampshire participating in RGGI. That’s because New Hampshire buys about half its power from a wholesale market whose rates will rise as other states’ power producers buy RGGI allowances and pass on the costs to ratepayers.

If the state had not joined the initiative, electric users would have lost the benefit of a share of the allowances going into an energy efficiency fund whose aim is to lower both carbon emissions and energy consumption over time.

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