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New Jersey Will Miss First Greenhouse Gas Allowances Auction

September 23rd, 2008 Leave a comment Go to comments

Corzine Global Warming Program behind Schedule, Blowing Second Major Deadline

[Update: 11/23/08: On November 17, 2008, DEP adopted final rules to implement the RGGI program, enabling them to particiapte in the December auction. See:
[Update (9/25/08): looks like my message finally got picked up by NJ environmentalists and Bergen Record:
“But David Pringle, campaign director for the New Jersey Environmental Federation, said Corzine has done little to attack global warming since he signed the state’s Global Warming Response Act in 2007 amid much fanfare in Giants Stadium and with former Vice President Al Gore at his side.”
Corzine nothing but hot air, enviro groups say http://www.northjersey.com/environment/Corzines_got_nothing_but_hot_air_enviro_groups_say.html
For anyone who forgets that Giants Stadium July 2007 bill signing ceremony, here’s the picture posted on the Governor’s Office website:

Governor Corzine signs Global Warming Response Act at Giants Stadium with Al Gore and NJ legislators and environmentalists

[end update]
The state of New Jersey will be on the sidelines watching the historic first auction of greenhouse gas pollution allowances under the Regional Greenhouse Gas Initiative or RGGI scheduled for this Thursday, September 25, 2008.
New Jersey cannot participate in the auction because the Department of Environmental Protection (DEP) has yet to adopt regulations to implement the much touted and closely watched pollution trading program.
New Jersey’s RGGI rule proposal recently closed its public comment period on September 5, 2008 and adoption of final rules is not expected for several months.
Delays also means that New Jersey will miss an opportunity to generate the $40 to $70 million from auction proceeds authorized by RGGI implementing legislation recently signed into law by Gov. Corzine. Auction revenues are to be deposited in the “Global Warming Solutions Fund” and used for the following purposes: 60% to subsidize private commercial and industrial energy facilities; 20% to the BPU for energy demand programs; and 20% to DEP for emission reduction and carbon sequestration programs.
The lost opportunity to generate revenue comes after last week’s DEP Task Force Report that criticized deep cuts in DEP funding at the same time major new responsibilities were added:
“During the past two decades, despite an increasing number of rules and regulations, with a corresponding increase in responsibilities and workload, DEP staff levels have been reduced by more than 1,000 employees – about 25 percent. Further reductions are continuing to take place as of this writing.”

Governor Jon Corzine and DEP Commissioner Lisa P. Jackson

On June 30th, the DEP missed another major milestone by failing to release the comprehensive emissions reduction plan mandated by the highly touted Global Warming Response Act (GWRA). This required plan has still not been unveiled. These delays raise questions about the commitment and ability of the Corzine administration to the steep greenhouse gas emission reductions promised under the GWRA.
“New Jersey cannot claim to be a leader in the race against global warming when it does not even show up at the starting gate,” stated New Jersey PEER Director Bill Wolfe, a former DEP analyst. “The Governor’s bold rhetoric has been followed thus far by timidity and tardiness.”
RGGI is a regional compact among ten Northeast states. It is a market based “cap and trade” system to meet greenhouse gas reduction goals. This regional auction, the first in the United States, is being closely watched and will affect Congressional deliberations on how to fashion a national global warming strategy.
PEER has criticized the RGGI program because, by design, it can not meet its publicly stated emission reduction goal. The RGGI agreement does not address greenhouse gas emissions from out-of-state coal power (roughly 30% of New Jersey’s electric consumption) and would allow a nearly 10% increase in current instate power sector emissions. Moreover, market-driven cap and trade systems have a history of vulnerability to manipulation and enforcement problems.
“Given the current national financial crisis which was fueled by unregulated financial schemes, perhaps policy-makers should rethink the wisdom and effectiveness of so called ‘market based solutions,'” added Wolfe, noting that the New Jersey RGGI law provides subsidies to major polluters and does little to directly bring about deep emissions reductions. “As we are seeing, the market alone is no magic elixir, especially for the type of fundamental restructuring needed to meet the challenge of global warming.”
States offering allowances for sale on 9/25/08:
Connecticut, Maine, Maryland, Massachusetts, Rhode Island, Vermont
Learn more about the RGGI auction
Look at blown deadline on New Jersey global warming plan
See the weak New Jersey cap and trade plan
Revisit the vulnerabilities of cap and trade plans

States Aim to Cut Gases by Making Polluters Pay

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  1. TomTallTree
    September 23rd, 2008 at 10:00 | #1

    The buying and selling of Pollution Control Credits is another feel good and do nothing project.
    The owner of plant “A” spits out 1,000 units of pollution. Clean burning plant “B” has 1,000 units of pollution credits they can sell.
    Plant “A” buys the credits from Plant “B” resulting in the same amount of pollution being released into the atmosphere.
    We have just created another bureaucracy to do nothing, but it looks good.

  2. nohesitation
    September 23rd, 2008 at 10:10 | #2

    TTT – The trading of pollution credits is a “market based” approach, not a regulatory approach, so I don’t know what you mean by “creating more bureaucracy to do nothing”.
    Your example is flawed as well – in theory, RGGI is supposed to be a “cap and trade” program, where an absolute cap on emissions is set and emission reductions occur over time.
    The problems with RGGI are that there is no real cap, the cap allows increases in emissions, and here are inadequate emissions reductions.
    Opinions should be based on knowledge and facts.

  3. catcracker
    September 24th, 2008 at 09:53 | #3

    “Auction revenues are to be deposited in the “Global Warming Solutions Fund” and used for the following purposes: 60% to subsidize private commercial and industrial energy facilities; 20% to the BPU for energy demand programs; and 20% to DEP for emission reduction and carbon sequestration programs.”
    And who administers this fund? Sounds like a bueaucracy will spring up to dole out the $$$ to campaign contributors? Corzine and the Trenton Politicians are so corrupt the money will be squandered just like the recent waste on schools construction. Who will decide which industry deserves to sell credits and what guidlines are to be used to issue such credits. This will be a boondogle for the “traders” on wall street and we know who they look after.
    Implementation if such a program will only further drive industry out of NJ. This could be the death blow for NJ.
    Finally based on satelite data, we have not had any global warming for about 10 years, so maybe the entire program can be scrapped. CO2 is not a pollutant unless it comes from the breath of politians from Washington and Trenton. Many scientists are now predicting a period of global cooling. We are rushing into mandates when the climate science is weak.

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