New York State Initiative to Reduce GHGs: Regional Greenhouse Gas - - PowerPoint PPT Presentation

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New York State Initiative to Reduce GHGs: Regional Greenhouse Gas - - PowerPoint PPT Presentation

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New York State Initiative to Reduce GHGs: Regional Greenhouse Gas Initiative (RGGI) Environmental Monitoring, Evaluation, and Protection in New York: Linking Science and Policy October 25, 2005 Karl Michael Program Manager NYSERDA RGGI

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SLIDE 1

New York State Initiative to Reduce GHG’s: Regional Greenhouse Gas Initiative (RGGI)

Environmental Monitoring, Evaluation, and Protection in New York: Linking Science and Policy

October 25, 2005

Karl Michael

Program Manager NYSERDA

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SLIDE 2

RGGI Process

  • Gov. Pataki’s April 2003 Invitation
  • Staff Working Group (SWG)
  • Stakeholders
  • SWG Proposal
  • Agency Heads Meetings
  • Model Rule and MOU
  • Rulemaking
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SLIDE 3

RGGI Design Principles

  • Reduce CO2 with flexible, market-

based program to achieve least cost reductions.

  • Create model for federal program.
  • Maintain electricity affordability, reliability

and fuel diversity.

  • Make expandable to other states.
  • Build on programs in place.
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SLIDE 4

Key Elements of RGGI Proposal

  • Carbon cap

– Stabilize emissions through 2015 – Decrease by 10% by 2020

  • State CO2 budgets

– Based primarily on 2000-2004 emissions

  • Offsets (Non-electric)

– Up to 50% of emissions reductions

  • 20-25% of State Budget Auctioned

– Energy efficiency, new technologies, etc.

  • Built-in review in 2015

– Price impacts, offsets, imports

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SLIDE 5

NY CO2 Emissions Trajectories

40 42 44 46 48 50 52 54 56 58 60 2006 2009 2012 2015 2018 2021 2024 Millions of Tons CO2 Reference Cap Only Package

Note: unlimited banking allowed

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SLIDE 6

NY Generation Mix

  • 20,000

40,000 60,000 80,000 100,000 120,000 140,000 160,000 180,000 200,000

  • Ref. 2006
  • Ref. 2024

Cap Only - 2024 Package - 2024

NY GWh

Nuclear Existing Renewables Coal Oil/Gas Natural Gas (CC&CT) Other - NUG/Cogen New Renewables Net Imports

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SLIDE 7

1 2 3 4 5 6 7 8 9 2006 2009 2012 2015 2018 2021 2024 $/Ton Package Cap Only

CO2 Allowance Prices

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SLIDE 8

0.0% 1.0% 2.0% 3.0% 4.0% 5.0% 6.0% 2006 2009 2012 2015 2018 2021 2024 Change in Energy Price Package Cap Only

Change in RGGI Average Annual Energy Prices

NOTE: Energy prices represent wholesale market prices and include annualized capacity prices. Note that the RGGI Package Scenario assumes that current levels of annual state expenditures for public benefit programs continue through 2025. While these types of programs cause lower wholesale prices by reducing electricity demand, they are paid for by consumers through a line item charge at the retail level, and are therefore not reflected in the wholesale price changes shown above. Current retail electricity prices already include the annual costs of these programs. While the modeling assumes that end-use energy efficiency is implemented entirely by public benefit programs, it is recognized that energy efficiency could also be implemented by actions such as appliance standards and building codes that do not require state funding and could possibly be done at lower costs.

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SLIDE 9

RGGI Higher Emissions Sensitivities

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SLIDE 10

RGGI Generation Mix

Reference v. High Gas v. High Emissions

  • 100

200 300 400 500 600

Reference High Gas High Emission Reference High Gas High Emission Reference High Gas High Emission 2006 2012 2024

TWh

Net Imports Other Renewables Wind Other Oil/Gas Gas Coal Nuclear

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SLIDE 11

20 40 60 80 100 120 140 160 180 200 2006 2009 2012 2015 2018 2021 2024 Million Tons

Reference High Gas High Emission

CO2 Emissions Reference v. High Gas v. High Emissions

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SLIDE 12

RGGI Package Scenario compared to Higher Emissions Reference Case

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SLIDE 13

RGGI Generation Mix in 2024

  • 100

200 300 400 500 600

Reference Package High Emission High Emission + Package

TWh Net Imports Other Renewables Wind Other Oil/Gas Gas Coal Nuclear

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SLIDE 14

CO2 Allowance Prices

1 2 3 4 5 6 7 2006 2009 2012 2015 2018 2021 2024 $/Ton

Package High Emission + Package

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SLIDE 15

Change in RGGI Average Annual Energy Prices

NOTE: Energy prices represent wholesale market prices and include annualized capacity prices. Note that the RGGI Package Scenario assumes that current levels of annual state expenditures for public benefit programs continue through 2025. While these types of programs cause lower wholesale prices by reducing electricity demand, they are paid for by consumers through a line item charge at the retail level, and are therefore not reflected in the wholesale price changes shown above. Current retail electricity prices already include the annual costs of these programs. While the modeling assumes that end-use energy efficiency is implemented entirely by public benefit programs, it is recognized that energy efficiency could also be implemented by actions such as appliance standards and building codes that do not require state funding and could possibly be done at lower costs.

0% 1% 2% 3% 4% 5% 6% 7% 2006 2009 2012 2015 2018 2021 2024 Change in Energy Price Package High Emission + Package