New Jersey announces intent to pull out of RGGI cap and trade – Christie strikes major blow

In a press conference moments ago in Trenton, Gov. Christie announced his support for repealing the state’s cap-and-trade law and withdrawing from the Regional Greenhouse Gas Initiative (RGGI), a 10-state regional compact in the Northeast that implements a cap-and-trade energy tax scheme from Maine to Maryland.

“It’s a failure,” Christie said today. “RGGI has not changed behavior and it does not reduce emissions.”

He is absolutely right, and the implications are huge – especially considering that the architect of RGGI was Lisa Jackson, who once was New Jersey’s director of the Department of Environmental Protection under Gov. Jon Corzine, and is currently Obama’s administrator at the federal Environmental Protection Agency.  Jackson is now conspiring with Obama to disregard Congress, the American people, and the last national election to implement cap-and-trade like policies through a regulatory back door.

With Christie’s fabulous leadership, New Jersey will be out of RGGI by the end of the year, punching a huge hole in the middle of the regional scheme, lending momentum to burgeoning repel efforts in New Hampshire, Maine, and New York, and leading, perhaps, the final and total end of cap-and-trade as a politically viable concept anywhere in the United States.

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Editor
May 26, 2011 7:10 pm

“lending momentum to burgeoning repel efforts in New Hampshire, Maine, and New York”
Sadly, those repeal efforts are not burgeoning. From my http://wermenh.com/rggiwatch/index.html May 11 wasn’t a very good day:

# May 11: Delaware’s House Energy Committee tables their get-out-of-RGGI bill so it won’t be considered by the full house.
# May 11: Maine rejects their get-out-of-RGGI bill and reaffirms an original condition to Maine’s participation in the program – specifically that New England states producing a minimum of 35 million tons of the annual carbon dioxide emissions budget must continue to participate in the program.
# May 11: The NH Senate’s full membership voted for HB 519-FN, 15-9.
And apparently next voted 16-8 for Jeb Bradley’s amendment (really his replacement) that keeps the state in RGGI, but cancels much of its impact.
16 votes are needed to be able to override an expected veto from Gov. Lynch. (It has to go through the Senate Finance committee, a house/senate conference committee and maybe a couple others first.)
# May 5: The NH Senate’s Energy and Natural Resources committee voted down HB 519-FN, 3-2. This gives the bill an “Inexpedient to Legislate” tag, but the bill continues the legislative process. It will next go to the senate’s Finance committee, back to the Energy and Natural Resources committee, and then to the full senate.
One thing the committee considered was an amendment introduced by Sen Bradley that rewrote the enitre bill. It removes much of the controversial funding of various groups, training, and insulation subsidies, leaving only some money for the “core” energy efficiency programs and funds it with $1.00 of the money received from each carbon allowance sold. (Currently a minimum of $1.89.) The remaining money will be given to ratepayers on a per-kwh basis.
It also changed the withdrawal trigger from the end of the year to when states representing 10% or more of the RGGI allowances leave RGGI. Apparently that was changed to just the New England states, but I’m not clear on the details. Apparently Sen Bradley withdrew the amendment saying it wasn’t ready. Without Bradley’s amendment there may not be enough support for the bill in the full senate, or at least, not enough to provide a veto-proof majority.
My testimony for the hearing is at http://wermenh.com/rggiwatch/enr_testimony.html .

The NH (New Hampshire, not Northern Hemisphere) House tagged RGGI repel as one of their key goals and hence are not keen on Sen Bradley’s amendment. They are trying to attach the original bill to other legislation. Law making is like making sausage. I’m not fond of these sorts of tactics, and this sausage has rotten meat. Things are sufficiently confused so I haven’t written a new post on recent NH activity, I’ve just dropped notes in Tips and Notes.
I’m not sure how the NJ new will play in NH. Maine will likely ignore it and remain in their RGGI embrace. The bill to get out was entered more to stimulate discussion than be a serious attempt at repeal.
I could see Delaware untabling their bill.
One curiosity about NJ’s withdrawal is that Delaware and Maryland will no longer share a border with the remaining RGGI states. I’m not sure what that means. Well, it may be obvious – they’ll just buy power from those dirty coal plants in Pennsylvania and clean plants in NJ (if that offshore wind energy works.)
The next quarterly allowance auction is in mid-June, with allowances being offered for both this control period and the next. There will be zero demand from NJ for the next period (2012-2014). There will be a demand for at least 10% of the current period, but it may not much higher than that. I would expect electricity providers should have nearly all the allowances they need for this year.
I’ll likely write up a summary of the next auction, there will be interesting aspects even though the auction price is virtually certain to be $1.89, the floor price.

Editor
May 26, 2011 7:22 pm

From http://www.examiner.com/essex-county-conservative-in-newark/rggi-nj-body-blow-new-jersey-out

Several New Jersey Senators and Assembly members have proposed to take New Jersey out of RGGI. But Christie could always get out. Staying in RGGI is voluntary; so says the MOU. That means that the other nine States can’t sue New Jersey to keep it in. (No State has even talked about that.) [Hmm, I had assumed it would take legislation to withdraw. This confirms my suspicion that the NJ legislature had voted its way out and that Christie was able to do this on his own. The next governor could put NJ back in just as easily, I assume (unless that counts as levying a new tax).]
Furthermore, the program is unconstitutional. The US Constitution forbids any State to enter into any multi-State compact unless Congress lets it. No federal law says that any State must or even may form such a compact. [I’ve heard this argument, I guess people haven’t felt they’ve had the financial backing to prosecute it. Besides, Congress could allow it maybe not this year, but possibly before litigation was finished.]

Michael Klein
May 26, 2011 7:24 pm

As an AGW proponent, I was pleasantly surprised by Christie’s remarks. I favor RGGI, but I’m prepared to approach it with an open mind. If RGGI really isn’t reigning in greenhouse gases, let’s dump it. Christie is courageous in banning new coal-fired plants from his state and seeking to enhance renewable sources of energy.

May 26, 2011 7:30 pm

Smokey says:
May 26, 2011 at 6:37 pm
Agree w/Bob Johnston. Christie is smart enough to know the “carbon” issue is bogus. But plenty of his constituents aren’t that smart. He’s a politician, and that means he’s always calculating the vote. Always. . .
I would love for someone of Gov. Christie’s stature to forcefully state that the “carbon” issue is simply a racket, and explain why. But he’s a pol, and telling the truth to that extent wouldn’t be good for his numbers.

Nuts. Gov. Christie’s appeal (to conservatives, anyway) is based entirely on his reputation for straight-talking, not pandering to voters and polls. If he’s hewing to the orthodox Alarmist line on “greenhouse gases” and “climate change” just in order to be politically safe, then he’s not the straight-shootin’ character he’s pretended to be.
I suspect he’s either bought the Alarmist theology because he’s been hoodwinked by all those advisors he claims to have consulted, or because he’s not nearly as smart as everyone thinks he is, or both.
/Mr Lynn

May 26, 2011 7:35 pm

PS, re Smokey’s “I would love for someone of Gov. Christie’s stature. . .”
I’ve been arguing for years that what would drive a fatal stake into the Watermelon movement’s heart would be for a prominent leader to come out and declare that “global warming” is a fraud. I tried to convince Mitt Romney’s people of this back in ’08; never even got a response.
Maybe Sarah Palin will have the guts to stand up to the High Priesthood of Climate Change. Somebody has to.
/Mr Lynn

BradProp1
May 26, 2011 7:37 pm

He’s right to end it, but he’s still stupid enough to listen to the 90% (all 73) scientists that say man is causing global warming. I just decided based on that info that I hope he doesn’t run for president.

GregO
May 26, 2011 8:07 pm

Good move Christie. Let’s not forget that Arizona also had a fit of sanity and dropped out of the western regional states plan for Cap and Trade. The rent-seekers dream is still alive though…
http://www.westernclimateinitiative.org/

Al Gored
May 26, 2011 8:25 pm

I doubt that he does accept AGW but it would be too much to say so right now. One step at a time.
Also doubt very, very much if he will run in 2012.
I hope Rick Perry, Gov of Texas does. He has all the right stuff and could win. In any case, given what slimey low-life liars the Obamites are, this campaign is going to be too ugly for words.

May 26, 2011 8:30 pm

There is not such figure “90%”, the number is 97% based on one of two bogus studies,
1. The Doran paper claims a bogus “97%” which is only 75 out of 77 subjectively cherry picked “specialists” or 2.4% of the 3146 who participated in the survey out of 10,257 Earth Scientists who were sent an invitation.
2. The Anderegg paper is based on Google Scholar illiteracy and worthless.
So long as he does not prevent Natural Gas or Nuclear, preventing coal is playing to the eco-idiots. The offshore wind is emotional nonsense.

R. de Haan
May 26, 2011 8:33 pm

Fortunately there is no affordable green solution to replace coal by a long shot.
Green solutions apart from not being solutions are not green at all.
Wind only mills 15.4 % max of the rated capacity and this is the high number.
The amount of steel, composite and rare earth resources necessary for it’s construction is flabbergasting, all consuming huge amounts of oil, cokes and resources.
Conventional power plants are needed for 100% of the installed wind capacity resulting in sky high electricity bills.
A healthy economy is based on cheap energy.
Without it we’re losing a big part of our middle class, jobs and buying power.
A green economy is a poor economy.
Unfortunately fact don’t count these day’s and stupidity rules.
Good luck with that.

Charlie Foxtrot
May 26, 2011 9:26 pm

I think the gov. did what he needed to do. A total rejection of AGW would destroy his credibility with a good portion of his constituency. He accomplished what needed to be done without opening himself up to denunciation as a flat earther. He doesn’t need such distractions right now, and he is after all a politician who knows how to shuck and jive as needed. He likely realizes that AGW will go away eventually anyway, and since it is not his field, he is wise to avoid taking sides. He might not have lived up to his straight shooter, no holds barred reputation, but AGW is not his area of expertise.

May 26, 2011 9:34 pm

But he still believes in global warming.

gallopingcamel
May 26, 2011 9:48 pm

Great work Governor!
Let’s take this brilliance to Washington and defund the EPA.
And defund the Department of Education too.

brc
May 26, 2011 9:55 pm

This will get picked up by the Australian media. The Australian government has been pointing to ’10 US states’ as an example of an ETS. It looks like this system will collapse with one or two major players exiting. The price collapse to below the price floor is bad enough.
The more these schemes collapse under their own weight, the better. There is not an effective cap and trade scheme anywhere in the world, and the only countries that have achieved lower emissions is either because of Nuclear Power or recession. The former is OK but the latter isn’t.

mike restin
May 26, 2011 10:59 pm

“Mr Lynn says:
May 26, 2011 at 6:20 pm
It’s good that NJ will bail out of the ill-advised and wrong-headed RGGI, but Gov. Christie’s announcement is a huge disappointment for those of us who thought he was smart enough—after “months” of study and review, no less—to understand that the claim that “90% of scientists” think that anthropogenic CO2 causes global warming is fatuous propaganda, and that it doesn’t, not in any measurable amount.”
—————-
I don’t care what 90% of ‘anybody’ thinks…….90% can’t prove CAGW.
From what I’ve read …… nobody can.

wermet
May 27, 2011 2:21 am

This appears to be a classic case of “doing the right thing, but for the wrong reason.”
From the video, Gov. Christie exposes himself as a committed pro-AGW, Cool-Aid drinking believer. To all of you calling on him to run for U.S. president, I have only one question, “Why?” How would he be any better that Obama? He can only be worst. If Christie becomes president, we have a Republican president out of step with a Republican House of Representatives. The pro-AGW President will encourage the House of Representatives to bend to his desires. This means BAD laws will be created, all because one this pro-AGW governor inadvertently got one AGW related issue right.
We cannot count on him to be “coincidentally” correct again.

charles nelson
May 27, 2011 2:34 am

This has punctured the project fatally.
If Jersey don’t go with Cap’n Trade try and imagine western or midwestern states signing up for it!

May 27, 2011 4:49 am

Since Christie was elected I have been incredibly concerned about his position on energy and the environment. Getting NJ out of RGGI is very reassuring. So far his environmental positions have been more posturing to placate the eco-nuts. As for those wanting him to run for president I agree he should not run (for various reasons) but for NJ he has so far been more than I could have dreamed of as a Governor who actually got elected. I had almost lost all hope on my state. This is another victory, thank you Governor Christie.

hell_is_like_newark
May 27, 2011 5:49 am

Unfortunately, we are still stuck with the idiotic wealth transfer tax plan to pay for solar panels, etc. My electric rates went from about $0.12 per kWh to around $0.18 per kWh. Its almost cheaper for me generate my own electricity at this point!
The increase was largely due to SREC program: Energy credits paid for each MWh of electricity generated by a solar array. Those credits can be hundreds of $$$ per MWh, which pays for the panels. Of course, its the rate payers that is the ultimate source of the energy credits.

May 27, 2011 6:02 am

hell_is_like_newark,
The average NJ citizen is an idiot and just blames the electric utility every time their bills go up. The all delusionally believe in wind and solar too, it is like talking to the wall.

harrywr2
May 27, 2011 8:04 am

TomB says:
May 26, 2011 at 6:06 pm
Nah, I’m disgusted. The whole “wind”, “solar” BS. The “there will be no more coal power plants in NJ, ever” BS.
If I look at the ‘delivered price’ of steam coal in New Jersey I wouldn’t even consider building a coal fired plant. New Jersey has the highest ‘delivered’ price for steam coal in the US.
http://www.eia.gov/cneaf/electricity/epm/table4_10_a.html

Henry chance
May 27, 2011 8:50 am

Climate progress claims this move is under Koch pressure. Koch had nothing to do with the state being short of cash. Climate progress is closing and will be a side bar in the Soros blog Center for American Progress.

nandheeswaran jothi
May 27, 2011 8:54 am

Poptech says:
May 27, 2011 at 6:02 am
hell_is_like_newark,
hell is basically newark with less crime.

nandheeswaran jothi
May 27, 2011 9:00 am

hell_is_like_newark says:
May 27, 2011 at 5:49 am
Unfortunately, we are still stuck with the idiotic wealth transfer tax plan to pay for solar panels, etc. My electric rates went from about $0.12 per kWh to around $0.18 per kWh. Its almost cheaper for me generate my own electricity at this point!
The increase was largely due to SREC program: Energy credits paid for each MWh of electricity generated by a solar array. Those credits can be hundreds of $$$ per MWh, which pays for the panels. Of course, its the rate payers that is the ultimate source of the energy credits.
Yes. The SREC proces in NJ are like 700$/MWH ( ie. 70c/kwh ). in the rest of the country it is like 250$/MWH ( like 25c/kwh ). so, it is predominantly a wealth re-distribution program….. when this was created, Lisa Jackson was in DEP-NJ, as a driver of that extraordinary pricing scheme. I

nandheeswaran jothi
May 27, 2011 9:14 am

i keep hearing complaints about coal power plants in NJ.
It does not matter who the Gov is and Who the Prez is and which party runs the state and feds ( NJ & US ), there will not any new coal power plants in NJ. This has nothing to do with CAGW. It has to do with a state that has 8.5 million people living in the land the size of 7400 sq miles ( 4th smallest state) and land cost up the wazoo, and pollution control devices needed being so high, it is better to site them in PA and OH. and that is what they do. The only kind of power plants that are cost effective in NJ are NatGas CoGen plants.