c2es.org. 2/27/2007 15% below 2005 by 2020 cap and trade 11/15/2007 set emissions targets by...
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c2es.org
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2/27/200715% below 2005 by 2020cap and trade
11/15/2007set emissions targets by 11/15/08~60-80% cuts by ???? (2040?)cap and trade; C inventory, reportingfull implementation by mid-2011
RegionalClimateAlliances
Spring 2008
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Nov 15, 2007, in devt
Dec 20, 2005, eff. 1/1/09
Feb 26, 2007, eff. 1/1/12 (goal = -15% of 2005levels by 2020)
June 25, 2008, not eff. yet
RegionalClimateAlliances
Spring 2010
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Transportation Climate Initiative(2010 declaration from 11 states)
RegionalClimateAlliances
Spring 2012
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XX
X
X
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* now only CA and Canadian provinces
RegionalClimateAlliances
Spring 2013
* no action since 2010
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and then there were two:
1)Western Climate Initiative (CA, BC, Quebec)-15% of 2005 by 2020- cap and trade programs linked
www.wci-inc.org
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2) Regional Greenhouse Gas Initiative (RGGI)
CT, DE, ME, MD, MA, NH, NY, RI, VT
current cap: 91million short tonsCO2/yr
www.rggi.org
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RGGI emissions by source
http://www.epa.gov/statelocalclimate/resources/state_energyco2inv.html
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Regional Greenhouse Gas Initiative (RGGI)
-set regional limits on GHG emissions from electric power plants & transportation
-based on “Model Rule”, but each state can design their own strategyfor implementation (state targets set for 2009 emissions)
-came into force in 2009
-power plant emissions remain constant through 2014, fall by 10% by 2018REVISED 2012: -40% by 2014, and -50% by 2020
-“cap & trade” mechanism: RGGI states will set GHG cap and then auctionpermits equal to the tons of CO2 allowed by the cap- auctions are quarterly (next one March 11th, 2015)
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Basic elements of Model Rule:
1) applicability: applies to fossil fuel-fired electric generating units >25MW(covers 25% of regional GHG emissions)
2) size & structure of cap: a) states must stabilize power sector CO2 emissions at 2009
emissions during implementation (2009-2014)b) then reduce emissions by 2.5%/yr for 2015-2018(total reductions of 10% below 2009 levels by 2018)
3) permitting: each CO2 source must have approved CO2 budget emission monitoring plan (EMP); developed by state energy regulators4) allowance allocation: most CO2 allowances auctioned off (vs. ETS)
25% allowances to support consumer benefit programs5) temporal flexibility mechanisms:
facilities can “bank” or “rollover” CO2 allowancesearly reduction allowances granted for early demonstrated
reductionsextended compliance period
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Basic elements of Model Rule: (cont.)
6) emissions monitoring: CO2 unit must install and certify monitoring system, report quality-controlled data (borrows from EPA acid rain program)
7) offsets: awards CO2 offset allowances to projects outside capped sector that sequester/reduce CO2 emissions (limited to 3.3% of unit’s total compliance obligation)-must be “real, additional, verifiable, enforceable, and permanent.”-http://rggi.org/market/offsets/categories-includes SF6 emissions, trees, building HVAC efficiency (nat gas, oil, propane), landfill methane capture
8) price triggers: stage 1: if CO2 allowance cost >$4, CO2 offsets can increase stage 2: if CO2 allowance cost >$10, CO2 offsets increase more,
compliance period extended, international CO2 credits allowed
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Carbon Allowance Reserve (as of 2014)
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Who stands to gain here?
Who stands to lose?
Or is it that simple?
What would you do as a power company in a RGGI state?
What is leakage? and how does it impact RGGI?
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LEAKAGE
- a shift of electricity generation from capped sources subject to RGGI to higher-emitting sources not subject to RGGI.
-impossible to predict ahead of time (market and political forces unknown)
-RGGI proposes to:1) track load vs. generation2) monitor C-intensive nature of non-RGGI power
policy options:1) reduce electricity demand (efficiency), so indirectly reduce leakage
2) limit the amount of CO2 (<xx lbs CO2/MWh) that could be “emitted” through long-term purchasing agreements between RGGI utilities and regional power plants
3) emissions portfolio standard
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http://fas.org/sgp/crs/misc/R41836.pdf
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Across three past CO2 allowance auctions, cost ~$1.93/ton
How much money did they make?
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http://www.eia.gov/todayinenergy/detail.cfm?id=14851
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http://rggi.org/docs/Auctions/26/PR120514_Auction26.pdf
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How much did it cost the average customer?Distributing the CO2 allowance costs around the ratepayers in thoseStates, RGGI costs added $0.43/month to the average electric utility bill.
Where did all this money go?
http://rggi.org/images/Reinvestment.JPG
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http://rggi.org/docs/Documents/2012-Investment-Report_ES.pdf
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Has RGGI reduced emissions? [does it matter?]
http://fivethirtyeight.com/features/the-cap-matters-most-in-cap-and-trade-markets/
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no big difference between RGGI and non-RGGI states, so far
http://fivethirtyeight.com/features/the-cap-matters-most-in-cap-and-trade-markets/
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fuel switching (coal to natural gas) reduced CO2 emissions
http://www.eia.gov/todayinenergy/detail.cfm?id=14851
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new cap will challenge RGGI’s effectiveness
http://fivethirtyeight.com/features/the-cap-matters-most-in-cap-and-trade-markets/
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source: rggi.org
a different perspective
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Categories of State GHG activities
1)Vehicle Emissions Standards
2)Renewable Portfolio Standards
3) Efficiency Standards/Programs
4) Cap and Trade programs
Most content in the following section fromCenter for Climate and Energy Solutions (c2es.org)
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Vehicle Greenhouse Gas Emissions Standards – California leads the way
2002: CA passes law requiring 30% emissions reductions by 20122002-2007: EPA stalls on granting CA waiver to step outside
federal emissions standards in response to industry complaints2007: CA files lawsuit against EPA for stalling2009: EPA grants CA waiver to set standards *if* changes to 2016 timelines
to be consistent with Obama CAFE standards
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Federal Corporate Average Fuel Economy (CAFÉ) standards
CAFÉ standardscurrent: 35.5 by 2012-1016future?: 54.5 by 2025
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Plug-in electric vehicles
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Biofuels
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Low-carbon Fuel Standard: a lifecycle analysis of trans. fuel sources
Ex from California: fuel providers must reduce C intensity of fuel mix 10% by 2020
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Renewable Portfolio Standards
Ranges from:CA: 33% by 2020TX: 5% by 2015NY: 30% by 2015CO: 30% by 2020NC: 12.5% by 2021
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Financial Incentives for CCS
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Energy Efficiency Standardsand Targets
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Hydraulic FracturingChemical Disclosure Map
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through electricity bills and/orutility charges
allows costumers to sell electricityback to grid
Public benefit funds Net metering programs
Green PricingGaPower optional: $5/100kwhr;green powerw/ 50% solar;~$50/monthadditional cost
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Appliance Efficiency Standards
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Residential Building Energy Codes
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Commercial Building Energy Codes
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State Building Efficiency Requirements