RGGI Draft Model RuleOffset Comments from Environment Northeast

Regional Greenhouse Gas Initiative Stakeholder Meeting

Hartford, CTMay 2, 2006

Derek MurrowDirector, Policy Analysis

RGGI Stakeholder Meeting, Hartford, CT, May 2, 2006

Offsets Issue 1 Afforestation – Permanence

Issue: Conservation easements are flexible and should include language specific to carbon retention, with a particular focus on timber harvesting

Goal: Maintain a constant level of carbon sequestration after offsets project monitoring has ceased

Recommendation: The Conservation Easement should state that no significant timber harvest

should be allowed, or if timber is harvested, a management plan should be developed with a % stocking or carbon based requirement to keep the same quantity of timber (carbon) on the property as was present during the last offset monitoring and verification audit

Concept Proposal (needs input from others): Drop the 20% discount if the developer purchases a state approved insurance policy to cover natural disturbances over a set period (i.e. 100 years) that includes monitoring (allow for new technology advances like remote sensing); the insurance company would have to retire allowances equal to carbon loses on a regular monitoring and reporting schedule (i.e. five years)

RGGI Stakeholder Meeting, Hartford, CT, May 2, 2006

Offsets Issue 2 Afforestation – SFI and FSC Certification

Issue: SFI and FSC are designed to accredit forests that are actively managed for timber harvesting

Goal: Avoid negative environmental impacts

Recommendation: The easement should state that forestlands should not be commercially harvested unless they achieve SFI or FSC certification (no certification required if harvesting does not occur)

RGGI Stakeholder Meeting, Hartford, CT, May 2, 2006

Offsets Issue 3Energy Efficiency – Additionality

Issue: Projects that receive public financing in whole or in part are not likely to be additional (a detailed assessment would be required of each project and would be quite burdensome) and the Model Rule should address financing sources in addition to system benefit funds

Goal: Promote new efficiency projects that would not otherwise occur

Recommendation:

A bright line test should be in place that excludes all state, federal, or utility sponsored grants (SBC, utility programs, weatherization, DOE funded state grants to commercial entities, etc), which would avoid a complicated financial review and ensure that offset money promotes new investments in efficiency

Consider a review of this requirement after a set number of years with consideration of a standardized financial additionality test if the project also receives state or federal support

RGGI Stakeholder Meeting, Hartford, CT, May 2, 2006

Offsets Issue 4Energy Efficiency – Additionality (2)

Issue: The rule is not clear and explicit (within the formulas) about how baseline energy use is calculated when a state or federal code or standard is in place for that equipment

Goal: Develop a clear and simple way to describe the role of codes and standards in additionality calculations

Recommendation: Include the code or standard adjustment directly in the baseline energy use formulas, as most of the new equipment installed will have to meet state or federal appliance and equipment standards

RGGI Stakeholder Meeting, Hartford, CT, May 2, 2006

Offsets Issue 5 Methane from Agriculture – Accounting

Issue: The rule is clear that “regional-type digesters” are acceptable, but does not account for GHG emissions due to transporting manure to a central site (this appears to be the only offset type that has significant emissions from O&M)

Goal: Ensure that all project GHG emissions are captured in the accounting protocols

Recommendation: Require “regional-type digesters” from multiple farms to account for transport GHG emissions based on a standardized emissions factor to transport one ton of manure, one mile (distance easily measured and mass already reported)

RGGI Stakeholder Meeting, Hartford, CT, May 2, 2006

Contact Information

Derek K. Murrow

Director of Policy Analysis

dmurrow@env-ne.org

Michelle E. Lichtenfels

Policy Analyst

mlichtenfels@env-ne.org

Environment Northeast

101 Whitney Ave.

New Haven, CT 06510

(203) 495-8224

Rockport, ME – Boston, MA – Hartford, CT

www.env-ne.org