State seeks windfall on energy plan

AUGUSTA – Baldacci administration officials reaffirmed Maine’s commitment to a regional pact on global warming Wednesday and announced plans to funnel millions of dollars from the program into energy efficiency.

For many of the 150-plus people in attendance, Wednesday’s forum on the Regional Greenhouse Gas Initiative could not have been more timely.

A report released last week by an international panel of climate scientists and policy makers pinpoints humans as the likely cause of rising global temperatures and predicted dire consequences unless the developed world takes immediate action.

Boston University’s Bruce Anderson said Wednesday that computer-generated climate models predict that, a century from today, Maine may feel more like Washington, D.C., and could see significantly fewer snow days and experience more sustained droughts.

Anderson, with BU’s Department of Geography and the Environment, said the world’s climate will change regardless because carbon dioxide lingers for 100 to 150 years in the atmosphere. But acting now can avoid the most extreme scenarios, he said.

“You guys have an opportunity to make a difference,” Anderson told the crowd attending the forum, sponsored by the University of Southern Maine’s Muskie School of Public Service and the University of Maine’s Margaret Chase Smith Policy Center.

That’s where the Regional Greenhouse Gas Initiative comes into play, speakers said.

Known as RGGI or “Reggie” for short, the initiative involves 10 states, including Maine, that have pledged to cap emissions of greenhouse gas emissions from fossil fuel-fired power plants beginning in 2009. Power plants must then reduce their emissions by an additional 10 percent by 2019.

The Legislature is preparing to consider several bills that would authorize Maine’s involvement in RGGI.

David Littell, commissioner of the Maine Department of Environmental Protection, used Wednesday’s forum to announce that, under the administration’s bill, Maine would receive a significant financial windfall for energy efficiency programs.

States participating in RGGI set limits on greenhouse gases by allotting a certain number of emissions “allowances” or “credits” to each plant based on past emission levels.

Power plants that are more efficient than required can either bank their excess allowances for future use or sell them to plants exceeding their limits. This market-based approach is regarded as more flexible than forced regulation because it offers companies a financial incentive to go beyond their emissions goals.

Littell announced Wednesday that the administration plans to follow the lead of several other states by selling or auctioning off all of its credits, thereby forcing plants to pay up front for the right to emit CO2.

Depending on the per-credit price, Maine could expect to receive between $12 million and $30 million from the auction.

Littell said officials are still discussing how to divide the money among energy-related programs. Some groups want all of the money to go into programs that promote energy conservation, such as Efficiency Maine. Others want some money to go to rate-payers to help offset the modest rate increases anticipated from RGGI.

Littell said that Baldacci also plans to use some of the money to lessen the financial impact on some paper mills – including the Verso plant in Bucksport – that will have to reduce emissions under RGGI.

Verso’s Bucksport and Jay mills have combined heat-and-power systems that generate electricity for the mill and the power grid, with the latent steam heat used in the paper-making process. Verso representatives have said that, because the Bucksport mill is already so efficient, it will be difficult to reduce emission levels even more.

Representatives of several conservation groups praised the governor’s decision to auction off 100 percent of the emissions credits. But they urged the governor to earmark all of the money for energy efficiency programs.

“If the revenue from a RGGI auction is used to fund energy efficiency investments in our homes and businesses, then we will reduce energy costs and strengthen our economy at the same time,” Dylan Voorhees, clean energy director for the Natural Resources Council of Maine, said in a statement.

The forum’s final speaker was the United Kingdom’s consul-general for New England, John Rankin, who said that his country has cut greenhouse gas emissions by 14 percent while adding jobs and growing its economy by 49 percent. That proves sound environmental policies and economic growth can go hand in hand, Rankin said.