News blog

New Jersey nixes participation in US cap-and-trade system

remote-slide2.jpgNew Jersey Governor Chris Christie yesterday announced his decision to withdraw his state from the Regional Greenhouse Gas Initiative (RGGI), the only functioning US carbon cap-and-trade system, by year’s end. He argued that the program not only fails to reduce greenhouse gas emissions, but creates an unnecessary tax burden on citizens and businesses.

“RGGI does nothing more than tax electricity, tax our citizens, tax our businesses with no measurable impact upon our environment,” said Christie at a 26 May press conference in Trenton, New Jersey.

While Christie said he believes climate change is real, humans are contributing, and that New Jersey is committed to combating it, he said RGGI is ineffective at reducing greenhouse gas emissions. The cost of allowances remains too low to change behavior, he said, and New Jersey’s emissions are already below the goals for 2020 set out in the state’s Global Warming Response Act.

“The market, not RGGI has created incentives to reduce the use of carbon-based fuels,” he said. “Given that we now have laws that provide significant market incentives for wind, solar and in-state natural gas generation, any benefits that the RGGI tax may have had are miniscule.”

Under RGGI, 10 Northeast and Mid-Atlantic States of the US put a limit on the carbon dioxide emissions they can release and aim to reduce emissions from the power sector 10 percent by 2018. States invest the money they gain from auctioning emission allowances in clean, renewable and efficient energy initiatives.

In response to Christie’s decision, representatives of several partner states in the program reinforced their commitment to the program.

“The RGGI program has been extremely successful in supporting clean energy, reducing electricity bills and lowering greenhouse gas emissions throughout the region,” said New York Department of Environmental Conservation Commissioner Joseph Martens in a statement. “Region wide, emissions from the power plants covered by RGGI have gone down much faster than expected. With the support of a broad range of stakeholders, New York will continue to participate in RGGI.”

On the other hand, participation in RGGI has recently been questioned by legislators in New Hampshire, Delaware and Maine, though all have voted to remain in the program for now.

The decision by Christie underscores the shakiness of cap-and-trade schemes at the state level in the US. Last week a judge ordered a halt on California’s proposed cap-and-trade program until alternatives have been examined. (For more about California’s efforts to reduce emissions, see our feature on the topic.)

Image: EPA


  1. Report this comment

    David Reed said:

    Has anyone seen those solar panel on the light poles all over New Jersey?

Comments are closed.