New Hampshire House Votes to Quit Northeast U.S. Carbon Market

The Republican-led New Hampshire House of Representatives voted for a second time to withdraw the state from the U.S. Northeast’s cap-and-trade program for power plants.

The House passed by voice vote today a shoreland protection bill with an amendment pulling New Hampshire out of the 10-state Regional Greenhouse Gas Initiative, Speaker William O’Brien, a Republican, said in an e-mail.

The amendment mirrors legislation already passed by the House on March 30 to end New Hampshire’s participation in the regional cap-and-trade program, which forces power plants to buy pollution allowances for the carbon dioxide released from their smokestacks. Today’s vote follows New Jersey Republican Governor Chris Christie’s May 26 announcement that his state will exit the program by the end of this year.

“At a time when we must become more competitive both nationally and globally, keeping cap-and-trade in place and adding additional energy costs to our employers and citizens makes no sense,” O’Brien said. The New Hampshire Senate voted 24-0 today for a rival plan that would dump the carbon trading program only if other states exit.

The program members are the six New England states, New Jersey, New York, Delaware and Maryland. Since 2008, they have raised more than $860 million by auctioning pollution rights, or allowances. Some states, including New Hampshire, have used part of the proceeds to plug budget holes.

Carbon Allowances

Almost two-thirds of the money states have raised selling carbon-dioxide allowances is set aside for energy-efficiency and renewable-energy projects, according to a Feb. 28 report from the cap-and-trade program.

New Hampshire Governor John Lynch, a Democrat, opposes the cap-and-trade repeal effort. Lynch has said exiting the regional carbon market would deprive the state of $12 million a year in carbon-allowance sales.

The funds help households and businesses pay for energy- saving projects that reduce their electricity use and lower their utility bills, according to Lynch. Colin Manning, Lynch’s spokesman, didn’t immediately respond to an e-mail and phone message seeking comment on today’s votes.

In the bill passed today by the Republican-led Senate, New Hampshire would leave the carbon market if a New England state responsible for more than 10 percent of the region’s power demand dropped out of the carbon market. New Hampshire could also exit the program if two smaller New England states backed out, Majority Leader Jeb Bradley said on the Senate floor.

Different Power Grids

“If two other states leave, or if 10 percent of the load from New England leaves, this program is all but over,” Bradley said.

The loss of New Jersey from the market won’t trigger New Hampshire’s departure under the Senate bill because the two states get their electricity from different power grids, Carole Alfano, a spokeswoman for Bradley, said in an e-mail. Bradley had said before today’s debate his legislation would allow New Hampshire to leave the regional carbon market if New Jersey pulls out.

The passage of the House and Senate cap-and-trade bills sets up a negotiation between the two chambers over the shape of a final bill, Alfano said.

To contact the reporter on this story: Simon Lomax in Washington at slomax@bloomberg.net

To contact the editor responsible for this story: Larry Liebert at lliebert@bloomberg.net

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