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Report: RGGI nets N.H. $17 million



Last modified: Wednesday, November 16, 2011
A new report finds a regional cap-and-trade system has been an economic boon to New Hampshire and other participating states, but it's unlikely to convince top Republicans to abandon their efforts to withdraw from the program.

The Analysis Group, a Boston-based economic analysis firm, reviewed data from the three years since the Regional Greenhouse Gas Initiative was implemented by the 10 participating Northeast states. The firm says the economic model used in its independent analysis found the program has boosted New Hampshire's economy by $17 million and created 458 jobs in the state. For all 10 states, the program has had an economic benefit of $1.6 billion and created 16,135 jobs, according to the report.

Paul Hibbard, vice president at Analysis Group, said the firm did not take a position on whether states should continue their involvement in the program but 'we find that the program has actually worked very well.'

'The end results were economic benefits to every state,' Hibbard said. 'I think the burden of proof is on people who want to end the program to demonstrate that there's a rationale for doing so.'

The Regional Greenhouse Gas Initiative, known as RGGI, caps regional carbon emissions and requires power plants to purchase an allowance at auction for each ton of carbon dioxide they emit. Proceeds from the auctions are used for energy efficiency initiatives, and the program's goal is to reduce carbon dioxide emissions from power plants 10 percent by 2018.

The state's annual report on RGGI, released last month, said New Hampshire has taken in $33 million in revenue from the program since joining in 2008. Meanwhile, the program has added 46 cents to the average ratepayer's monthly bill, according to the state report.

Republicans in the Legislature have criticized the program as an added tax to New Hampshire ratepayers who do not benefit from the energy efficiency grants awarded by the state. House Majority Leader D.J. Bettencourt, a Republican from Salem, said yesterday he had not had time to fully vet the Analysis Group report but indicated he is not likely to be swayed by an economic analysis that is not specific to New Hampshire. According to the report, New Hampshire's $17 million economic benefit from RGGI is the lowest of all 10 states.

'This has been a money loser for our ratepayers and businesses,' Bettencourt said. 'In fact, I originally supported the RGGI program, but the facts are that this program is hurting working families and adding an additional burden on small businesses as they try to recover from our economic slowdown.'

Rep. Jim Garrity, a Republican from Atkinson who heads the House committee that oversees RGGI legislation, said a bill is already in the works for the 2012 session to withdraw from the program by 2014. Earlier this year, a bill pulling New Hampshire out of the compact passed the House but fell one vote short in the Senate.

Garrity questioned the validity of the report's economic model, citing its use of 'indirect' economic effects he said could represent conjecture or 'fuzzy and wishful thinking.' However, he said the report will likely be part of the discussion over RGGI next year and its researchers will likely be called to testify before his Science, Technology and Energy Committee.

'The more economic analyses we have, the better,' Garrity said. 'I will ask them to dive into the numbers and show us their assumptions, show us their math.'

During the 2011 legislative session, Garrity refused to budge from his position that the state must withdraw from the program entirely. Senate Majority Leader Jeb Bradley had pleaded with House members to consider reforming the program instead of seeking complete repeal, which he warned would not have the Senate votes necessary to override a veto by the governor.

Bradley said yesterday he is 'not sold' on RGGI by the Analysis Group report.

'I think what you have is a program that isn't doing what it was supposed to do, despite what reports like this say,' he said.

(Matthew Spolar can be reached at 369-3309 or mspolar@cmonitor.com.)