New Jersey Carbon Cap and Trade Plan Called 'Timid'

The trading program proposed by the administration of Governor Jon Corzine sets emissions caps above current emissions levels and contains numerous complex offsets and loopholes that undercut its effectiveness.

"While we are pleased that New Jersey is finally moving, this is a very timid and tentative step," said New Jersey PEER Director Bill Wolfe, noting that the proposed rule is now open for public comment until September 5, 2008.

"How can we cut carbon emissions with caps that are higher than current emissions?" he asked. "This plan says fighting global warming is worth less than 50 cents a month - not even enough for a cup of coffee."

The B.L. England coal-fired power plant in New Jersey (Photo by Curt Bergesen)

On drawback of the measure is that, "The initial regional cap is 188 million short tons of CO2 per year, which is approximately four percent above annual average regional emissions during the period 2000 through 2004 for electric generating units that will be subject to the program," the bill states.

The program was designed to minimize economic impacts and "to provide market signals and regulatory certainty," PEER says.

As a result, the plan places a $2 per ton price cap in order to hold any increase in current electric rates to less than one percent - about $5.96 per year or 50 cents per month for a typical Garden State household.

PEER says the 200 page proposed rule is littered with industry-specific escape hatches.

Even the proposing agency, the New Jersey Department of Environmental Protection, concedes that its trading program will have more rhetorical than practical effect, when it states in the proposal itself:

"By accelerating national action to address climate change, the Department believes that the proposed rules and amendments will result in broader future environmental benefits beyond the direct emissions reduction benefits achieved through the CO2 Budget Trading Program," the agency said in a statement.

The DEP said the proposed cap-and-trade program "will result in a more timely adoption of required Federal measures to reduce greenhouse gas emissions, which will reduce environmental impacts to the State and its residents."

This rule is the state’s contribution to the Regional Greenhouse Gas Initiative, RGGI, which includes nine other Northeast and Mid-Atlantic States.

RGGI is an ongoing effort, commenced in September 2003, among Northeast and Mid-Atlantic States to develop and implement a regional CO2 cap-and-trade program aimed at stabilizing and then reducing emissions from large fossil fuel-fired electricity generating units in the region.

RGGI only applies to the electricity sector and power generators, which account for about 30 percent of New Jersey’s greenhouse gas emissions.

New Jersey imports about 30 percent of its power, mostly generated by burning coal, but these emissions are not counted by RGGI.

As for addressing the majority of the state's greenhouse gas emissions, New Jersey is already behind schedule, missing a June 30 deadline for its overall plan for the ambitious goals of the Global Warming Response Act signed by Governor Corzine last year.

A public hearing concerning this rule proposal will be held on:
Thursday, August 14, 2008 at 10:00 am at:
New Jersey Department of Environmental Protection
Hearing Room, 1st Floor
401 East State Street
Trenton, New Jersey 08625

Written comments may be submitted at the public hearing, they can be mailed to the New Jersey DEP.

Submit written comments by September 5, 2008 to:
Alice A. Previte, Esq.
Attention: DEP Docket No. 07-08-06/662
Office of Legal Affairs
New Jersey Department of Environmental Protection
401 East State Street
PO Box 402
Trenton, NJ 08625-0402

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