Maine and six other states in the Northeast have agreed to set up the nation’s first system to cut greenhouse gas pollution from power plants, governors around the region said Tuesday.
The so-called cap-and-trade system to reduce carbon dioxide emissions would cover electricity generating plants with a capacity of 25 megawatts or more. Carbon dioxide in the atmosphere traps heat around the Earth and is considered a primary contributor to global warming.
“This agreement protects the health and welfare of our citizens,” Maine Gov. John Baldacci said in a written statement.
States must now draft formal rules to implement the plan, and Maine officials plan to seek final approval from the state’s Legislature, probably in 2007.
Maine has six power plants large enough to face restrictions under the plan, though it’s not clear yet how each plant would be affected.
Dawn Gallagher, commissioner of the Department of Environmental Protection, said the plan is expected to increase electricity rates less than 1 percent in Maine. The plan would allow deadline extensions if compliance costs exceeded certain amounts. “There are some safeguards built in,” Gallagher said.
Under the plan, the states agreed to cap carbon dioxide emissions at current levels – about 121 million tons annually – from 2009 to 2015, then to reduce emissions 10 percent by 2019. The plan caps overall carbon dioxide emissions but lets power plants trade pollution allowances – credits – as a way to encourage cutbacks. The system is similar to what much of the rest of the world is now doing under the Kyoto Protocol.
“Under this program, we will use a market-based system to curtail harmful CO2 emissions and spur the development of innovative technologies that will reduce our dependence on foreign energy, strengthen our economy, and take meaningful steps in the fight against climate change,” New York Gov. George Pataki said in a prepared statement.
In addition to Maine and New York, the states signing on to the Regional Greenhouse Gas Initiative are Connecticut, Delaware New Hampshire, New Jersey and Vermont. Rhode Island and Massachusetts balked at signing the agreement after expressing concerns about its potential economic effects.
Numerous environmental activists praised the pact on Tuesday.
“This will really make a big difference on bringing down electricity generation emissions that contribute to global warming as well as other air pollution,” said Matthew Davis of Environment Maine, an advocacy group. “It’s a good start and it’s a model that should be replicated in other parts of the country.”>/p>
Some business leaders also hailed the accord.
“The Regional Greenhouse Gas Initiative marks an important step forward for the northeastern states in their efforts to address climate change,” said Theodore Roosevelt IV, managing director of Lehman Brothers Inc. and chairman of Strategies for the Global Environment.
There also was criticism.
“We’re not opponents of the idea, but we can’t support something so poorly designed,” said Anthony Buxton, counsel to the Industrial Energy Consumer Group, representing Maine’s largest consumers of electricity.
Buxton complained that state-of-the-art power generators and states that have made substantial advances in cutting pollution would effectively be penalized under the plan for having taken action already.
He also said the agreement could lead to higher electricity rates that would be passed on to consumers.
Pataki’s office estimates that average household bills could increase by $3 to $21 annually.
The Regional Greenhouse Gas Initiative has been in the works since 2003. It calls for states to issue one allowance, or permit, for each ton of CO2 emissions allowed by the cap. Companies that do not have enough allowances to cover CO2 emissions must either reduce their emissions or buy allowances from sources that are able to keep their emissions below their prescribed cap, officials said.
The agreement would let power plants claim allowances for separate undertakings that reduce emissions. Examples include landfill gas recovery, reforestation, and methane capture from farming or natural gas transmission facilities.
Maine officials hope the state will be able to meet its limits in part by getting credit for such alternative actions, which can slow global warming.
Maine is the first state to measure and track greenhouse gas emissions, and already has cut state government’s emissions by 8 percent in two years by improving energy efficiency, Baldacci said Tuesday.
“Maine is leading by example to protect our energy and environmental resources, and RGGI is another crucial step,” he said.
– Staff Writer John Richardson and The Associated Press contributed to this report.