Report: Regional cap-and-trade program improved state economies

A regional cap-and-trade program established in the Northeast has reduced greenhouse gas emissions, created new jobs and lowered state energy bills, a report released Monday says.

The report comes as prospects for a federal cap-and-trade system for greenhouse gases are all but dead following the failure to pass such a program in the Senate last year. Cap-and-trade opponents argue that such program would impose burdens on the power sector that would result in major economic harm.

But the new report says that a regional cap-and-trade program has resulted in a series of economic benefits for a select group of states.

The report focuses on the Regional Greenhouse Gas Initiative (RGGI), a 10-state cap-and-trade program in the Northeast. The report, commissioned by the organization that runs the program, analyzes investments made with money generated from a series of emissions-allowance auctions beginning in 2008.

States invested 80 percent of the $789.2 million generated from the auctions in energy programs, the report finds. Overall, those investments result in significant returns. For every $1 invested, the states saw $3 to $4 in returns.

The energy programs funded with the proceeds from the emissions-allowance auctions have lowered energy bills, according to the report. “Many consumers who participate in RGGI-funded weatherization and retrofitting programs realize energy bill savings of 15 to 30 percent,” the report says.

The report also says the program helped create 18,000 jobs that will last for at least one year. “Employment benefits result from state program investments and from the reinvestment of consumer energy bill savings in the wider economy,” the report says.

State officials touted the report Monday. Collin O’Mara, secretary of the Delaware Department of Natural Resources and Environmental Control, said RGGI has helped grow Delaware’s economy.

"RGGI is helping to improve air quality in Delaware while also helping make our economy more competitive,” O’Mara said in a statement.

RGGI Chairman David Littell, who is also commissioner of the Maine Public Utilities Commission, said Maine has been able to invest in energy efficiency with the proceeds from emissions-allowance auctions, a move that has resulted in lower energy bills.

"RGGI is lowering Mainer’s energy bills, benefiting Maine’s economy and helping Maine’s businesses reduce their bottom-line expenses,” Littell said in a statement. “Over the last two years, $7.1 million in proceeds have funded 19 industrial-scale energy efficiency projects, enabling some of Maine’s largest employers to invest in new equipment and maintain or add employees."