Nation’s first greenhouse gas cap-and-trade auction launches

Nation’s first greenhouse gas cap-and-trade auction launches; Beaupre In case you missed it (most people did), yesterday saw the launch of the nation's first mandatory cap-and-trade auction for carbon emission credits ... with little fanfare. 

Ten northeastern states, including our little Granite State, will let polluters bid on a limited amount CO2 allowances - 188 million tons of carbon emissions annually, to be exact. The Regional Greenhouse Gas Initiative, or RGGI (pronounced 'Reggie'), will cap emissions for 233 power plants, with a goal of reducing the cap an additional 10% by 2018. 

But already the system has its critics. After a tepid first day of trading, the Wall Street Journal took a skeptical view of the program's long-term viability. The New York Times pointed out how emissions cap will have little impact at first because it's based on overestimates of CO2 output. And others cry that it's no more than a tax in green clothing that will raise electric rates (which it probably will, at first, but lower over the long term).

But the critics are shortsighted. What's more more important is that a real, free market-based cap-and-trade system for global warming reduction is now in place. There's a platform and regulatory mandate for cutting greenhouse gasses that didn't exist before. It's a build-it-and-they-will-come opportunity. It's a good first step.

Call me a green romantic. I know RGGI won't save the world right away, but at least we're finally giving power companies financial incentives to modernize plants, reduce emissions and explore alternative energy approaches. The program freezes greenhouse gases from power plants at current levels, and promises significant reductions long term.

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