“We tracked the dollars spent, and RGGI generates greater economic growth in every one of the 10 states that participate in RGGI than would occur without a carbon price. The states’ auction of the CO2 allowances was important for generating those public benefits.” — Susan Tierney, managing principal at the Analysis Group
A new report finds that America’s first mandatory, market-based carbon cap and trade system added $1.6 billion in value to the economies of participating states, set the stage for $1.1 billion in ratepayer savings, and created 16,000 jobs in its first three years of implementation.
The Regional Greenhouse Gas Initiative (RGGI) — a modest 10-state cap and trade program designed to reduce carbon emissions in the utility sector 10% by 2018 — was implemented in the Northeastern U.S. in 2008. At that time, there was a strong consensus that policy action to address climate was needed, and the program was crafted with bi-partisan support.
However, as the faux climategate scandal unfolded and the plan for a national cap and trade program unraveled, some of the support for RGGI disintegrated. Driven by an aggressive multi-million dollar campaign from the Koch-funded Americans for Prosperity, some state legislatures considered pulling out of RGGI. Only New Jersey’s governor Chris Christie, who once strongly supported RGGI, actually acted to take his state out, claiming the program was a “gimmick.”
But this latest three-year analysis from the economic consultancy Analysis Group shows that the program has been anything but a gimmick — creating solid economic returns that outweigh the costs. According to the study, RGGI has created 16,000 jobs, helped states avoid $765 million in out-of-state energy imports, and created over $1 billion in net present value for ratepayers: