1. Regional Greenhouse Gas Initiative: First auction results & the future
New England Restructuring Roundtable
DEP Commissioner Laurie Burt
December 5, 2008

2. Patchwork Approach? No, Beautiful Quilt.

3. RGGI Basics First mandatory cap-and-trade program for CO2
10 States: MA, RI, NJ, NH, VT, ME,
NY, CT, MD, DE
Program covers power generators > 25 MW
Current cap = 188 million tons
10% reduction in 2009 CO2 levels by 2019
Auction nearly 100% of allowances
First compliance period begins Jan 1, 2009

4. RGGI Initial Goals Stabilize GHG emissions Create a market for carbon
Demonstrate a state-led regional program can work
Professional, predictable auction model
Aggressive investment in energy efficiency and renewables

5. First Auction: RGGI on the Move
September 25, 2008
12.5 million allowances auctioned
59 separate entities submitted bids, 44 entities purchased allowances (80 percent sold to compliance entities)
Demand outpaced supply 4:1
$1.86 Reserve Price
$3.07 Clearing Price
$38.5 million total proceeds ($13.5 million to MA)
Market Monitor, Potomac Economics:
“Auction raised no material concerns…”

6. Second Auction: December 17, 2008
Any Changes?
All 10 RGGI states plan to participate
31.5 million allowances
Clearing price and # of allowances sold released w/in 48 hours of auction close.
Post-settlement report (dispersion of bids, type of bidder) released Jan 6
Auction schedule at:

7. Where Will the Money Go? Energy Efficiency & Renewable Energy:
Massachusetts, Maryland, New Hampshire,
New Jersey, New York
Consumer-Focused Programs (to reduce long-term energy demand and costs):
Connecticut, Delaware, Maine, Rhode Island, Vermont

8. RGGI funds in Massachusetts are already being deployed
80 percent to energy efficiency:
$6M: Fund 100 percent of electric utility companies proposed winter 2008 efficiency program increases ($3M from each auction)
$3M: Help cities and towns implement energy efficiency
$4M: Help low-income households be more energy efficient through state’s HEARTWAP ($2M from each auction)
$5M: Kick-start Green Communities Act

9. What’s Next for RGGI? Offsets Future areas of collaboration:
Low carbon fuel standard (LCFS)
CA LEV program (8/10 RGGI states have adopted)
GHG reporting
10 states require GHG reporting: CA, CT, MA, ME, NV, NJ, NM, OR, WA
MA Global Warming Solutions Act requires GHG reporting >5,000 tons/year in CO2e, including commercial/industrial
Anticipated RGGI would expand to other sectors

10. What’s Next for RGGI?
RGGI’s relationship to WCI and Midwest Greenhouse Gas Accord
What about Florida?

11. Federal Program RGGI designed as glide path for federal action
RGGI has brought energy/environmental agencies together in unprecedented ways.
We will insist:
Strong state-federal partnership
Credit to states who have implemented GHG policy
Support at least at the RGGI level
State role: monitoring, reporting, permitting, energy efficiency, siting & building renewables