Regional Green House Gas Initiative Boosts Economy with $25.5 Million

The states participating in the Regional Greenhouse Gas Initiative (RGGI), the nation's first market-based regulatory program to reduce greenhouse gas emissions, announced the results of their 12th quarterly auction of carbon dioxide (CO2) allowances. States are investing the majority of proceeds from RGGI auctions - now more than $886.4 million - to promote clean energy sources and lower energy costs for consumers across the region.

To be exact, 12,537,000, or 30 percent, of the 42,034,184 current control period (2009-2011) CO2 allowances offered for sale by the 10 participating states were sold. The auction clearing price was $1.89 per allowance, the minimum reserve price for the auction. There were 25 entities that submitted winning bids, ranging from $1.89 to $7.40. Electric generators and their corporate affiliates purchased 91 percent of the current control period allowances sold.

The participating states of Connecticut, Delaware, Maine, Maryland, Massachusetts, New Hampshire, New York, Rhode Island and Vermont also offered a smaller number of CO2 allowances for a future control period (2012-2014). 943,000, or 51 percent, of the 1,864,952 future control period allowances offered in the auction were sold. The auction clearing price was $1.89 per allowance. Five bidders submitted winning bids, with bids ranging from $1.89 to $2.07. Electric generators and their corporate affiliates purchased 100 percent of the future control period allowances sold. New Jersey did not offer future control period allowances for sale in Auction 12.

As they have for each previous auction, the participating states published a report from the independent market monitor with aggregate auction results and a list of all qualified participants that submitted their intent to bid in the auction. According to the market monitor's report, electric generators and their corporate affiliates have won 85 percent of all CO2 allowances sold in Auctions 1-12 and will hold 97 percent of CO2 allowances in circulation following the settlement of Auction 12. Additional details may be found in the Market Monitor Report for Auction 12, available at: www.rggi.org/docs/Auction_12_Release_Report.pdf.

"The RGGI states have put a price on carbon to foster innovation in our region," said David Littell, a commissioner of the Maine Public Utilities Commission and Chair of the Regional Greenhouse Gas Initiative, Inc. board of directors. "The RGGI auctions are continuing to drive large-scale investments in energy bill savings and improved business competitiveness."

"RGGI auctions were designed to provide electricity generators with access to the allowances they need," said Collin O'Mara, secretary of the Delaware Department of Natural Resources and Environmental Control and Secretary of the Regional Greenhouse Gas Initiative, Inc. board of directors. "As we near the end of the first compliance period with significantly reduced carbon emissions, electricity generators require fewer allowances. Today's auction results show the success of the RGGI market-based system in distributing allowances efficiently and contributing to emissions reductions."

Proceeds from RGGI auctions now total more than $886.4 million, 80 percent of which is invested to save energy consumers money, create jobs and make businesses more competitive.

For example, NH is investing RGGI proceeds in programs that help local businesses boost their bottom lines through energy efficiency. Barons Major Brands, an appliance retailer in Laconia, is just one company to benefit from the state's investments. Thanks to an energy efficiency rebate program coordinated by the Retail Merchants Association of NH and funded in part by RGGI proceeds, Barons is expected to save 25 percent in energy bills annually - or more than $7,800 each year.

Similarly, Maryland is investing RGGI proceeds to create energy savings for multi-family and public housing residents across the state. The Cedar Lane Senior Living Community in Leonardtown is just one of approximately 100 grants that have been awarded through Maryland's investments. Last year, Cedar Lane invested $50,000 in RGGI proceeds to improve heating system efficiency in 51 apartments. As a result, residents are expected to save $47 for every $100 previously spent on heating and cooling costs.

In Maine, RGGI proceeds are invested to implement large-scale energy efficiency projects in commercial and industrial facilities. Sappi Fine Paper's Somerset Mill in Skowhegan is just one of 17 companies that have received RGGI-funded grants from Efficiency Maine's Large Projects Grant Program. As a result of the project, the mill is expected to save enough electricity annually to power 300 typical Maine households for a full year.

In Massachusetts, RGGI-funded programs are enabling workers to secure jobs in clean energy industries. John Greg is just one of 67 people at Greenfield Community College to receive energy efficiency job training through a new RGGI-funded program for building specialists. After graduating from Greenfield's first class in the fall of 2010, John secured a position as an energy efficiency specialist at Cape SAVE, a weatherization firm in South Yarmouth. John is now supervising a crew of four people and is earning more than $20 per hour.

To learn more, go to www.rggi.org/docs/Investment_of_RGGI_Allowance_Proceeds.pdf.

The next RGGI auction is scheduled for September 7, 2011.