In the Media
USA: Regional cap-and-trade effort seeks greater impact by cutting carbon allowances
January 26, 2012
The New York Times
Adjusting to shifts in the economy, states in the cap-and-trade system known as the Regional Greenhouse Gas Initiative have slashed the number of allowances that electric power companies can buy to offset their emissions.
The decision, made last week, was intended to shore up the pioneering program as it undergoes its first comprehensive review this year. While the program has been judged a success by most of the participating states, in the Northeast and Mid-Atlantic, an oversupply of the allowances — in essence, permits to pollute — has limited the program’s impact.
The program, the nation’s first cap-and-trade system, sets a ceiling on carbon dioxide emissions from electric power providers and requires the companies to pay for their heat-trapping emissions by buying the allowances in online auctions held four times a year. Companies that pollute less can benefit by selling off allowances to other companies.
Some environmental groups are advocating changes that would broaden the program to include other industrial and commercial sources of greenhouse gas emissions and link it to similar programs in the works, like the cap-and-trade system being planned by California and some Canadian provinces.
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Keywords: cap-and-trade, compliance, North America, RGGI, USA