Bill Text: NH HB1490 | 2012 | Regular Session | Amended
Bill Title: Relative to New Hampshires regional greenhouse gas initiative cap and trade program for controlling carbon dioxide emissions.
Spectrum: Partisan Bill (Republican 3-0)
Status: (Passed) 2012-06-25 - House II Remainder Effective as Provided in Section 17 [HB1490 Detail]
Download: New_Hampshire-2012-HB1490-Amended.html
HB 1490-FN – AS AMENDED BY THE HOUSE
28Mar2012… 1390h
2012 SESSION
09/10
HOUSE BILL 1490-FN
AN ACT relative to New Hampshire’s regional greenhouse gas initiative cap and trade program for controlling carbon dioxide emissions.
SPONSORS: Rep. Bergevin, Hills 17; Rep. Hansen, Hills 6; Rep. Pettengill, Carr 1
COMMITTEE: Science, Technology and Energy
This bill makes certain changes to New Hampshire’s regional greenhouse gas initiative cap and trade program for 2013 and 2014 and repeals the program on January 1, 2015.
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Explanation: Matter added to current law appears in bold italics.
Matter removed from current law appears [in brackets and struckthrough.]
Matter which is either (a) all new or (b) repealed and reenacted appears in regular type.
28Mar2012… 1390h
12-2017
09/10
STATE OF NEW HAMPSHIRE
In the Year of Our Lord Two Thousand Twelve
AN ACT relative to New Hampshire’s regional greenhouse gas initiative cap and trade program for controlling carbon dioxide emissions.
Be it Enacted by the Senate and House of Representatives in General Court convened:
1 Powers and Duties of Commissioner; Reference Deleted. Amend RSA 125-O:6, I to read as follows:
I. Develop a trading and banking program to provide appropriate compliance flexibility in meeting the emission caps established under RSA 125-O:3, III [and allowance requirements of RSA 125-O:21 and RSA 125-O:22], and to encourage earlier and greater emissions reductions and the development of new emission control technologies in order to maximize the cost-effectiveness with which the environmental benefits of this chapter are achieved.
2 Rulemaking Authority. Amend RSA 125-O:8 to read as follows:
125-O:8 Rulemaking Authority.
[I.] The commissioner shall adopt rules under RSA 541-A, commencing no later than 180 days after the effective date of this section, relative to:
[(a)] I. The establishment of trading and banking programs as authorized by RSA 125-O:6, I.
[(b)] II. The establishment of a method for allocating allowances and other emissions reduction units or mechanisms as authorized by RSA 125-O:3, II and III.
[(c)] III. Emissions [and allowance] monitoring, [tracking,] recordkeeping, reporting, and other such actions as may be necessary to verify compliance with this chapter.
[(d) The method and requirements for auctioning budget allowances under RSA 125-O:21, which may use regional organizations.
(e) Defining eligible projects for early reduction allowances under RSA 125-O:21, IV, and establishing criteria to quantify and grant such allowances.
(f) Defining eligible projects for offset allowances under RSA 125-O:21, V, and establishing criteria to quantify and grant such allowances, including the accreditation of third-party verifiers.
(g) The forms and information required on applications for a temporary or operating permit required under RSA 125-O:22.
II. The public utilities commission shall adopt rules, under RSA 541-A, to administer the greenhouse gas emissions reduction fund pursuant to RSA 125-O:23.]
3 Compliance Dates. Amend RSA 125-O:9 to read as follows:
125-O:9 Compliance Dates. The owner or operator of each affected source shall comply with the provisions of this chapter, excluding the subdivision on mercury emissions, RSA 125-O:11 through 125-O:18, [and the subdivision for CO2 emissions, RSA 125-O:19 through RSA 125-O:28,] by December 31, 2006.
4 Non-Severability. Amend RSA 125-O:10 to read as follows:
125-O:10 Non-Severability. No provision of [RSA 125-O:1 through RSA 125-O:18 of] this chapter shall be implemented in a manner inconsistent with the integrated, multi-pollutant strategy [or RSA 125-O:1 through RSA 125-O:18] of this chapter, and to this end, the provisions of [RSA 125-O:1 through RSA 125-O:18 of] this chapter are not severable.
5 Carbon Dioxide Emissions Budget Trading Program; Auction Proceeds. Amend RSA 125-O:21, II and III to read as follows:
II. The program shall include a statewide annual budget allowance of 8,620,460 tons [during the years 2009 through 2014. Beginning January 1, 2015 and ending December 31, 2018, the budget shall decline by 215,512 tons per year, resulting in a 10 percent total reduction from the initial budget, after which it shall remain unchanged until further legislative action] The department shall annually grant to each affected CO2 source by July 1, 2013 and by July 1, 2014 a number of allowances equal to the specified amount times its historic share of emissions. For purposes of this paragraph, “specified amount” means 8,404,948 minus the number of allowances to be granted for the given year under RSA 125-O:24, VI, and “historic share of emissions” means the average CO2 emissions of an affected CO2 source during calendar years 2007, 2008, 2009, 2010, and 2011 divided by the average CO2 emissions of all affected CO2 sources during the same time period. Such allowances shall first be used by each affected CO2 source for compliance with RSA 125-O:22, I before any excess can be sold or transferred to another party.
III. The department shall make available for sale at one or more auctions in a given year [all] 215,512 of the budget allowances for [a given] that year, except for those granted or reserved under RSA 125-O:22, VI[, 125-O:24,] and 125-O:25. The department shall also include in each auction all budget allowances from prior years that have not been purchased and those from the current year made available at an earlier auction in the year and not purchased. The department may also make available for sale at one or more auctions a portion of future year budget allowances. Such auctions may be conducted in coordination with other states. Revenues from the sale of allowances shall be deposited in the greenhouse gas emissions reduction fund established under RSA 125-O:23.
III-a. Budget allowances that are required to be made available for sale at auction under paragraph III, but remain unsold, shall not be retired by the department.
6 Greenhouse Gas Emissions Reduction Fund. Amend RSA 125-O:23, I to read as follows:
I. There is hereby established a greenhouse gas emissions reduction fund. This nonlapsing, special fund shall be continually appropriated to the commission to be expended in accordance with this section. The state treasurer shall invest the moneys deposited therein, as provided by law. Income received on investments made by the state treasurer shall also be credited to the fund. All programs supported by these funds shall be subject to audit by the commission as deemed necessary. A portion of the fund moneys shall be used to pay for commission and department costs to administer this subdivision, including contributions for the state's share of the costs of the RGGI regional organization. No fund moneys shall be used by the commission or the department to contract with outside consultants. Any new employee positions to be paid for using fund moneys shall be approved by the fiscal committee of the general court pursuant to RSA 124:15. The commission shall transfer from the fund to the department such costs as may be budgeted and expended, or otherwise approved by the fiscal committee and the governor and council, for the department's cost of administering this subdivision.
7 Repeal. The following are repealed:
I. RSA 125-O:3, III(d), relative to carbon dioxide cap.
II. RSA 125-O:20 through 125-O:28, relative to the regional greenhouse gas initiative.
8 Compliance.
I. The repeal of the regional greenhouse gas initiative program under section 7 of this act shall not effect each affected CO2 source’s obligation to satisfy the program’s requirements for the compliance period ending December 31, 2014, including those contained in adopted rules. All means of enforcement shall remain in place for these requirements, including the provisions of RSA 125-O:7 and any permit issued or modified by the department of environmental services in accordance with RSA 125-O:22, IV.
II. Any affected CO2 source that is a public utility pursuant to RSA 362:2 shall sell any allowances granted to it under RSA 125-O:21, II that it still holds after meeting the program’s requirements for the compliance period ending December 31, 2014. All proceeds from such sale shall be used to reduce the default service rates of the public utility.
9 Funding of Contracts. All contracts executed on or before December 31, 2014 that are funded through the greenhouse gas emissions reduction fund shall remain so funded according to the terms of those contracts.
10 Effective Date.
I. Sections 5-6 of this act shall take effect January 1, 2013.
II. The remainder of this act shall take effect January 1, 2015.
LBAO
12-2017
Amended 04/18/12
HB 1490 FISCAL NOTE
AN ACT relative to New Hampshire’s regional greenhouse gas initiative cap and trade program for controlling carbon dioxide emissions.
FISCAL IMPACT:
The Public Utilities Commission and Department of Environmental Services state this bill, as amended by the House (Amendment #2012-1390h), will decrease state restricted revenues and expenditures by approximately $6,663,275 in FY 2013, $13,326,550 in FY 2014, $13,534,519 in FY 2015 and $13,742,488 in FY 2016, and decrease state expenditures by approximately $7,000 in FY 2013, and $7,818 in FY 2014 and each year thereafter. This bill may decrease county and local revenue and expenditures by an indeterminable amount in FY 2013 and each year thereafter.
METHODOLOGY:
The Public Utilities Commission (Commission) and Department of Environmental Services (Department) state this bill amends statutes to no longer require electric generation facilities located in the State to purchase allowances, and repeals the Regional Greenhouse Gas Initiative (RGGI) cap and trade program for controlling carbon dioxide emission effective January 1, 2015 and the Greenhouse Gas Emissions Reduction Fund (GHGERF). The Commission and the Department state GHGERF is funded by the sale of NH RGGI allowances and is distributed as grants to fund energy efficiency projects for citizens, nonprofits, businesses, and governmental entities. The Commission and Department assume the following decrease in GHGERF revenue:
Assumed Floor Price
Number of Allowances
Decrease in GHGERF Revenue
FY 2013
$1.93
3,452,474
$6,663,275
FY 2014
$1.93
6,904,948
$13,326,550
FY 2015
$1.93
7,012,704
$13,534,519
FY 2016
$1.93
7,120,460
$13,742,488
To the extent state, county, and local entities would apply for and receive GHGERF grants for energy efficiency projects, state, county, and local restricted revenues will be reduced by an indeterminable amount in FY 2013 and each year thereafter. The Commission and the Department have expenditures related to the administration of the program of $473,328 ($252,071 for the Commission and $221,257 for the Department). The Commission and Department assume the sale of the 215,512 allowances per year for FY 2013 and FY 2014 is intended to provide for administrative expenses and meet contractual obligations. The Department and Commission state the 215,512 allowances sold at $1.93 will only generate $415,938, which may be insufficient to meet the administrative and contractual expenses in FY 2013 and FY 2014. Beginning in FY 2015 the entire administrative cost of $473,328 will be reduced.
The Commission and Department state this bill as amended will reduce electric rates for PSNH default customers because PSNH’s direct cost to purchase RGGI allowances for the generation that it owns to serve default customers will be reduced. This reduced cost is estimated to be $3.3 million in 2011. It is assumed PSNH will continue to have 1.5 million free allowances under the Clean Power Act Bonus Allocation Program per year, necessitating PSNH only purchase 1.376 million allowances for its regulated power plant emissions starting in calendar year 2012. At $1.93 per allowance, this will be $2,655,680 per year (1,376,000 * $1.93), or $0.0005213 per kilowatt hour of default service load in calendar year 2012 and each year thereafter ($2,655,680/ 5,094,000,000 kilowatt hours). The Commission and Department estimate state expenditures may decrease by approximately $7,000 in FY 2013 and $7,818 in FY 2014 through FY 2016 (number of default service kilowatt hours purchased by the state annually = 15,000,000 * $0.0005212), based on information from the Department of Administrative Services. Additionally, to the extent county and local governments are default PSNH customers, county and local expenditures may decrease in FY 2013 and each year thereafter. Because the Commission and Department do not know the kilowatt hours of default PSNH service purchased by county and local governments, the exact fiscal impact cannot be determined at this time.
