RGGI Auction Yields $2.5 Million for Investment in Maine Energy Efficiency, Job Creation
March 22, 2011
Samantha DePoy-Warren, Maine DEP Spokesperson firstname.lastname@example.org/(207)287-5842 or Patricia Aho, Maine DEP Deputy Commissioner email@example.com/(207)287-2811
NEW YORK, NY- The ten states participating in the Regional Greenhouse Gas Initiative (RGGI), the nation’s first market-based regulatory program to reduce greenhouse gas emissions, today announced the results of its 11th quarterly auction of carbon dioxide (CO2) allowances.
The auction, held Wednesday, March 9th, yielded $83,425,588 for states to invest in programs that enable energy consumers — including households, factories, farms and small businesses — to control their energy budgets.
Nearly $2.5 million of that will go to investment in Maine, which since the start of the RGGI auctions has won $26 million.
All of the of the 41,995,813 current control period CO2 allowances (2009-2011) offered in the auction sold at a price of $1.89 per allowance. Thirty-six entities submitted bids to purchase 1.1 times the available supply of allowances. Electric generators and their corporate affiliates purchased 85 percent of the current control period allowances.
States also offered a smaller number of CO2 allowances for a future control period (2012-2014). All of the 2,144,710 future control period allowances offered in the auction sold at a price of $1.89 per allowance. Seven entities submitted bids to purchase 1.4 times the available supply of allowances. Electric generators and their corporate affiliates purchased 56 percent of the future control period allowances.
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 an 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 1-11 and will hold 97 percent of CO2 allowances in circulation following the settlement of Auction 11.
"The RGGI states have put in place the infrastructure for a reliable, secure North American carbon market," 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 continue to provide power plants with the carbon allowances they need, and states will continue to invest millions from the RGGI auctions for energy bill savings, new jobs and improved business competitiveness."
Littell and Maine Department of Environmental Protection Deputy Commissioner Patricia Aho represent Maine on the RGGI Board of Directors.
States are investing proceeds from the RGGI auctions, now more than $860.9 million, in programs to save energy consumers money, create jobs and make businesses more competitive.
For example, Maine is investing a portion of its RGGI proceeds to implement large-scale energy efficiency projects in commercial and industrial facilities. Irving Forest Products in Dixfield and Moose River Lumber in Jackman, Maine are just two of 19 companies that received RGGI-funded grants from Efficiency Maine’s Large Projects Grant Program in 2010. Together, the sawmills are investing more than $1.5 million to enhance long-term viability through energy efficiency.
According to Susan Coulombe, divisional manager at Irving Forest Products, the project will enable the Dixfield sawmill to produce 25 percent of its electricity on site, saving enough money to sustain 235 jobs.
Moose River Lumber anticipates adding at least three jobs while retaining the 66 full-time and five part-time workers currently employed.
These examples show how projects funded with RGGI proceeds are building state economies with new jobs and savings for energy consumers.
The next RGGI auction is scheduled for June 8, 2011.
About the Regional Greenhouse Gas Initiative: The 10 Northeast and Mid-Atlantic states participating in RGGI (Connecticut, Delaware, Maine, Maryland, Massachusetts, New Jersey, New Hampshire, New York, Rhode Island and Vermont) have implemented the first market-based, mandatory cap-and-trade program in the U.S. to reduce greenhouse gas emissions. Power sector CO2 emissions are capped at 188 million short tons per year through 2014. The cap will then be reduced by 2.5 percent in each of the four years 2015 through 2018, for a total reduction of 10 percent. A CO2 allowance represents a limited authorization to emit one short ton of CO2, as issued by a respective participating state. A regulated power plant must hold CO2 allowances equal to its emissions to demonstrate compliance at the end of each three-year control period. The first control period for fossil fuel-fired electric generators under each state’s CO2 Budget Trading Program took effect on January 1, 2009 and extends through December 31, 2011. Allowances for the first (2009-2011) control period may be used to meet current compliance obligations, or may be banked for use in future control periods. CO2 allowances for the second (2012-2014) control period can only be used to meet compliance obligations beginning in 2012. CO2 allowances issued by any participating state are usable across all state programs, so that the ten individual state CO2 Budget Trading Programs, in aggregate, form one regional compliance market for CO2 emissions. For more information please visit: http://www.rggi.org/rggi.