Linking to Obtain the Potential Benefits of Broader Carbon Markets: Requirements of the Regional Greenhouse Gas Initiative (RGGI) | December 2016

WIEB Library

Given that heterogeneous carbon emission reduction policies and programs are developing in the West on a state-by-state basis, Western states may be interested in how to link with other programs to gain the benefits of larger carbon markets.  This brief describes RGGI, one of two U.S. regional carbon markets, and describes the requirements of linking with that system.  The paper focuses on areas most relevant to state autonomy not on the design elements of the cap and trade programs.  It includes the commitments required for participation, such as how to join, how to leave, and program design requirements.  It also includes how key decisions are made, such as, managing the regional organization, changing the program design requirements and establishing allowance budgets. Finally, it explains the options available for participation such as full bilateral (two-way) and unilateral (one-way) participation and additional options that are being explored by current participants. The paper culminates in next steps that can be taken to reduce barriers and increase incentives for participation.

This work was accomplished through a Idaho-WIEB State Energy Planning (SEP) project funded by the U.S. Department of Energy, Office of Energy Efficiency and Renewable Energy, to foster regional and state energy planning in the West and identify opportunities for multi-state or region-wide collaborations to address emerging energy issues.