A New England carbon emissions reduction program could generate more than $7 billion by 2030 for energy efficiency improvements and renewable energy, according to a new report, "Cooler Together," released Monday by a national environmental advocacy group.
Environment America, in collaboration with the left-leaning think tank, Frontier Group, analyzed the economic impact of the Regional Greenhouse Gas Initiative, also known as RGGI.
RGGI is a 10-year-old program where power plant companies in New England, Maryland, Delaware and New York have to buy allowances to emit carbon pollution. It also places a cap on carbon emissions that reduces by a small percentage each year.
Analysts multiplied the price of these allowances by each state’s expected carbon emissions for each year up until 2030. They estimate the program could generate $7.3 billion for member states.
"(The report) signifies tremendous progress on one of the most important challenges of our time," Andrea McGimsey, co-author and senior director for global warming solutions for Environment America, said. "The money can be invested by the states in more energy efficiency and turbo charging the clean energy revolution."
Since 2008, RGGI has raised more than $2.78 billion for participating states. More than $1 billion have been invested into energy efficiency improvements, such as home insulation to reduce heating bills, and $270 million have been put into clean and renewable energy.
Critics of the program have said it interferes with the free market and harms lower-income families by raising energy rates.
During the last decade, electricity rates in Rhode Island have gone up more than 6 percent at less than the rate of inflation. However, on a regional basis, prices have gone down more than three percent.
New Jersey and Virginia are currently in talks with member states to join RGGI. If they do, an additional $4.2 billion could be generated by 2030.
Carbon emissions from electric power plants have been cut in half in RGGI states since 2005. By 2030, another 132 million tons of carbon pollution, relative to 2020 emissions levels, could be avoided, according to the Natural Resources Defense Council.
If New Jersey and Virginia join RGGI, carbon emissions could be reduced by an additional 88 million tons by the end of the decade, according to the new report.