New Mexico Panel Approves Carbon Cap-And-Trade Rule

A New Mexico environmental panel adopted a cap-and-trade plan to cut greenhouse gases, a measure opposed by the state’s incoming Republican governor.

The state Environmental Improvement Board approved on a 4-3 vote the program for restricting carbon-dioxide emissions that scientists link to climate change, the New Mexico Environment Department said yesterday in a statement on its website.

The measure wouldn’t go into effect unless other U.S. states or Canadian provinces move ahead with similar systems for limiting greenhouse gases, the department said. The New Mexico program would regulate about 63 “large industrial sources,” such as power plants, the department said.

Governor-elect Susana Martinez opposes the cap-and-trade plan, her spokesman, Ted Kwong, said in e-mail before yesterday’s balloting. Martinez defeated Democratic Lieutenant Governor Diane Denish 54 percent to 46 percent, according to the Associated Press.

Current Governor Bill Richardson, a Democrat, said the U.S. government should “build on New Mexico’s program” and similar greenhouse gas limits planned in other U.S. states, such as California, “to implement a national cap-and-trade system.”

Federal Moves

President Barack Obama and Democrats in Congress failed to pass legislation this year that would create a federal cap-and-trade program, in which companies buy and sell a declining number of carbon dioxide permits.

Republicans in the U.S. House of Representatives, who won control of the body yesterday, have said they would block cap-and-trade legislation if they took a majority of seats in the midterm elections. They describe the measure as a “national energy tax.”

PNM Resources Inc., owner of the largest utility company in New Mexico, also opposes state-level greenhouse gas limits.

A national greenhouse-gas law “is the only way to meaningfully reduce emissions, minimize costs to customers and to our economy, and not disadvantage any particular state,” Pat Vincent-Collawn, PNM’s chief executive officer, said in a statement on the company’s website.

The utility company is “disappointed” by the environment board’s vote and will “evaluate all options, including legal.”

California Ballot

New Mexico is a member of the Western Climate Initiative, a coalition of Canadian provinces and U.S. states, including California, that seek to form a joint carbon trading system to cut emissions 15 percent from 2005 levels by 2020.

California voters rejected a ballot measure yesterday backed by oil refiners that would have suspended a global-warming law signed by Governor Arnold Schwarzenegger.

Proposition 23 was losing 39 percent to 61 percent, with 93 percent of the precincts counted, according to AP.

By 2015, California’s cap-and-trade program would cover nearly 400 million metric tons of carbon dioxide from power plants, factories, refineries and the tailpipes of cars and trucks, the state Air Resources Board said in a report last week.

By comparison, New Mexico’s annual greenhouse gas emissions are roughly equal to 24 million tons of carbon dioxide, the environment department said.

New Mexico won’t proceed with the cap-and-trade program unless states or provinces with combined emissions of at least 100 million tons of carbon dioxide agree to participate in the proposed carbon trading bloc, the environment department said.

Before it's here, it's on the Bloomberg Terminal. LEARN MORE