June 12, 20008
Union Leader
Gov. John Lynch signed a bill yesterday that brings New Hampshire in line with nine other states in limiting carbon dioxide emission from electric generating plants.
CONCORD – The Regional Greenhouse Gas Initiative is a cap-and-trade program that requires all fossil-fuel generation owners to cut emissions or purchase allowances for the carbon dioxide they emit at an open auction. Money raised through the auction will be used to fund energy improvements for electric customers, both residential and business, helping them cut usage and save money.
Lynch said the bill is “a major step forward in protecting our economy and our natural resources … Pollution and climate change threaten our state’s environment, our health and our economy.”
He said that if left unchanged, greenhouse gas emissions and the climate change they bring will hurt the state’s tourism industry and agriculture.
As the bill phases in over three years, it is expected to push electric rates higher. RGGI supporters, including a number of environmental protection groups, say the rates would rise even faster and higher if New Hampshire did not join the compact. The new law will bring an estimated 800 jobs and an infusion of $62 million to the economy, according to a study by the University of New Hampshire.
Because electric power is distributed regionally, costs in neighboring states that ship power to New Hampshire will reflect the costs of RGGI. Only if the state is part of the plan will it share in the electric conservation funds.
“RGGI balances short-term effects on rates, with long term benefits,” said Rep. Naida Kaen, D-Lee, chairman of the House Science, Energy and Technology Committee.
“The more money we can pour into energy efficiency and conservation efforts today, the greater the payback will be in the future,” said Erika Staff of Environment New Hampshire.
The law also contains price limits on the allowances that plant owners like Public Service Co. of New Hampshire pay at auction. In its first year, 2009, the price is set at $6 per allowance. Money from prices above that level will be rebated to electric customers. The cap goes up to $15 by 2015, and is removed entirely in the following year.
Jim Roche, president of the Business and Industry Association, said his organization supports the concept behind the bill, but worries about its effect on business and the economy.
Businesses have already made as many changes to energy consumption as they can find, he said.
“I think most businesses already got it, and did so well ahead of the Legislature. The economy has never been more global or competitive, and they are always looking for every opportunity to be more productive, more efficient and to save money on all energy,” he said.
“This is only going to force them to take an ever closer look at cost of doing business in New Hampshire,” Roche said.
PSNH spokesman Martin Murray said the company continues to work with the Department of Environmental Services on its share of allowances under RGGI and the state Clean Power Act.
While it is clear rates will go up for major power users, he said, “Our concern for the more typical residential and small business customers is making sure the supply of energy is available.”
Lynch noted before signing the bill that Congress is working on a bill that would make a similar program national. But he said the state cannot afford to wait for federal law to take effect.
“We must lead, and that is what we are doing,” Lynch said.
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