RGGI presents New England electric customers with a dilemma. Even if Maine decided to stop participating in RGGI, the costs of RGGI developed from other New England State's RGGI membership will permeate throughout the ISO-NE wholesale markets where the supply portion of monthly electric bills originate. The alternative would be to divert the amount of RGGI payments paid by the five fossil fuel plants located in Maine that are dedicated to Efficiency Maine Trust and return this money to the Maine ratepayers to offset wholesale market mark ups by RGGI.
If Maine sited fossil fuel plants can avoid the margin where the clearinghouse price is set, their market payments would include the production price including the RGGI costs from other state's fossil fuel plants as long as these other States remain a RGGI participant.
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If, on the other hand, other New England States also return RGGI payments back to ratepayers, RGGI still regulates emissions, but the whole experience becomes a zero sum exercise. The amount of laundered money through RGGI and back to ratepayers would rapidly grow as the cap on emissions keeps shrinking, thus raising the prices that plants would have to receive to offset production losses due to the ever shrinking, regulated emissions caps.
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Now for the Catch 22. The regulated caps would eventually cause such a loss in allowable production that emitting plants would be forced into retirement and the loss of dispatchable generation would cause the electric sector to collapse.
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This is where the ISO-NE market is headed and these grid operators lack the courage to tell the States that RGGI is a suicide mission. It is just a matter of time until the dispatchable plants start falling like dominoes, and where do we point the finger as power dwindles away or is only available at rationed limits according to the breezes and daylight sunshine? The States? RGGI? ISO-NE? CMP and Versant? The energy providers?
The Suicidal Tendencies of RGGI
by Dan McKay
3 hours ago
RGGI presents New England electric customers with a dilemma. Even if Maine decided to stop participating in RGGI, the costs of RGGI developed from other New England State's RGGI membership will permeate throughout the ISO-NE wholesale markets where the supply portion of monthly electric bills originate. The alternative would be to divert the amount of RGGI payments paid by the five fossil fuel plants located in Maine that are dedicated to Efficiency Maine Trust and return this money to the Maine ratepayers to offset wholesale market mark ups by RGGI.