Alliance to Save Energy Encourages States to Maximize Use of Energy Efficiency to Reduce GHG under Regional Initiative | Alliance to Save Energy

Alliance to Save Energy Encourages States to Maximize Use of Energy Efficiency to Reduce GHG under Regional Initiative

Release Date: Thursday, August 17, 2006

Washington, D.C., August 16, 2006 – The Alliance to Save Energy today urged the seven northeastern states participating in the Regional Greenhouse Gas Initiative (RGGI) – a regional cap-and-trade program for reducing carbon dioxide (CO2) emissions – to maximize their use of energy-efficiency to achieve the to-be-mandated reductions.

The RGGI is the first such mandatory program to reduce greenhouse gas emissions in U.S. history. The participating states – Connecticut, Delaware, Maine, New Hampshire, New Jersey, New York, and Vermont – have just released a set of model regulations to be implemented by each participating state. Under a recently-passed law, Maryland will join RGGI by June 2007.

While the RGGI Memorandum of Understanding (MOU) and new Model Rule allows states to use energy efficiency to meet their targets, according to Alliance President Kateri Callahan, “The appropriate and cost-effective level of efficiency investment will not happen of its own accord; RGGI states must adopt strong policies and measures to tap efficiency resources directly.”

One option, already in the Model Rule, would require states to allocate at least 25 percent of their emission allowances for “consumer benefit or strategic energy purposes,” including energy efficiency measures. Several states, in fact, are planning to devote 100 percent of such allowances to such public purposes, which include such programs as rebates, tax incentives, and public benefits funds.

“Allocating the majority of consumer allowance proceeds to energy efficiency will provide the greatest net benefits to customers,” Callahan said. “Energy efficiency is the most cost-effective way to achieve CO2 reductions, so we urge all participating states to treat the 25 percent requirement as a “floor”, not “ceiling” for dedicaton of allowances.”

The Alliance to Save Energy also encourages states to adopt complementary efficiency policies – tax incentives, energy-efficiency resource standards, appliance standards – that would further reduce emissions and the overall cost of the RGGI program.