Comments on Virginia’s proposal to Join the Regional Greenhouse Gas Initiative
As part of its climate plan, the State of Virginia proposes to join the Regional Greenhouse Gas Initiative (RGGI), a carbon trading program currently including states across the Northeastern US. We submitted comments to RGGI on how it can incorporate Virginia into the program and reduce carbon emission in a cost-effective way. RGGI should carefully assess the effect that Virginia’s initial carbon allowance level will have on the RGGI cap. Adding Virginia electricity generators to RGGI will improve electricity market efficiency. The exact extent of those improvements will be affected by the windfall revenue that Virginia’s power producers may receive through the unique consignment auction process for the allowances. RGGI should therefore ensure that the possibilities for windfall are minimized for Virginia’s regulated power producers.