Shaping up to be a state led effort, ten Eastern states
yesterday launched the country's boldest effort yet to combat climate change,
initiating a mandatory program designed to limit the amount of carbon dioxide
that power plants can expel along the upper East Coast.
The Regional Greenhouse Gas Initiative (RGGI) opened with a
landmark auction, accepting bids for permits that utilities must have for every
ton of CO2 they emit from their carbon-heavy facilities.
It's the first required cap-and-trade program in the nation,
imposed on 233 power plants, and supporters hope it will provide a model for a
federal successor. Participating states stretch from Maine to Maryland.
And it’s attracting international attention. It's the first
time that regulators are distributing nearly all of the pollution permits,
called allowances, through auctions, unlike the European program, which was
criticized for being excessively friendly to polluters when it awarded
allowances for free. Under RGGI, nearly all of the auction revenue will be used
for energy efficiency programs, a move intended to soften increased electricity
costs sparked by the program.
The utilities in the 10 states have three years to collect
enough allowances to match their emissions. And there are plenty of auctions in
which they can bid on the permits -- four every year. Or they could tap into
the secondary market and buy allowances from traders.
For now, the program is laying the infrastructure that could
be used by groups considering their own cap-and-trade programs in the Midwest
and West. And it could fuel action in Congress.
I applaud the RGGI group for their proactive leadership on
the issue – one that sadly, the current administration, should have taken. Let’s
hope we can get federal leadership with our new President leading the way. | 
