Cranking down on climate-altering emissions from power plants has been a net economic boon for Maryland and eight other Northeastern and mid-Atlantic states participating in the effort, according to a new report.
Over the past three years, the Regional Greenhouse Gas Initiative has added $1.3 billion to the economies of the nine states and yielded more than 14,000 new jobs, says the Analysis Group, an economic consulting firm, in a report presented at a utility regulators conference in New York. Meanwhile, consumers saved $460 million overall in lower electricity and heating bills, the report notes.
The report comes as the Obama administration prepares to finalize its Clean Power plan requiring cuts nationwide in carbon-dioxide emissions from fossil-fuel burning power plants.
Since 2008, Maryland and the other states have been auctioning off emission "allowances" to power plants, requiring them to pay for the carbon dioxide they release into the atmosphere. In that time, emissions have declined by about a third, the Analysis Group reports.
"That's not to say programs designed to cut greenhouse gas emissions are economic development programs -- their goals are different," said report author Paul Hibbard. "But the data clearly show that cutting carbon emissions can be a net positive for the economy."
That's important for Maryland, as lawmakers voted in 2009 to reduce the state's greenhouse gas emissions 25 percent by 2020. Lawmakers must renew their commitment next year, and to continue the effort state regulators are required to show it's a net positive for the economy.
The nine states in the greenhouse gas compact garnered a total of more than $938 million in revenues from sales of carbon emission credits over the past three years, the Analysis Group reports. Maryland's share of that was $221 million. The states used some of the revenue to help poor families pay their utility bills, but invested most in energy-efficiency and renewable power initiatives.
Although power companies would be inclined to pass the costs of the emission credits on to consumers by raising electricity rates, the consultant found prices actually came down over time as investments made in energy efficiency decreased demand.
Maryland realized a net economic gain of $214 million, the consultants found, with 2,475 jobs created.