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Wednesday, November 03, 2010
Panel OKs State Cap, Trade Plan
By Michael Hartranft
Copyright © 2010 Albuquerque Journal Journal Staff Writer
SANTA FE — The Environmental Improvement Board voted 4-3 Tuesday to adopt a controversial cap and trade plan for New Mexico to begin reducing greenhouse gas emissions believed to be contributing to global warming.
The decision, supported by EIB chair Gay Dillingham, Abbas Ghassemi, John Horning and James Gollin, is another step in an initiative begun by Gov. Bill Richardson in 2005.
The plan was opposed by both candidates for governor, dozens of lawmakers, some cities like Farmington and utility and oil and gas groups which argued it would raise consumer prices, destroy thousands of jobs and put New Mexico at an economic disadvantage with other states. Richardson appointed all members of the EIB and the head of the Environment Department which proposed it.
"I am pleased that the EIB adopted the program I have worked so hard to develop," Richardson said in a news release from his Environment Department Tuesday night.
Opponents vowed to challenge the decision.
"We remain convinced that comprehensive federal legislation is the only way to meaningfully reduce emissions, minimize costs to customers and to our economy, and not disadvantage any particular state," Public Service Company of New Mexico president Pat Vincent Collawn said in a statement. "... Because of the impact this new law could have on our state, our company and our customers, we will actively work with them again to evaluate all options, including legal, in response to today's 4-3 decision."
The plan would take effect in 2012, requiring businesses and industries that emit more than 25,000 metric tons of emissions a year to reduce emissions by 2 percent a year, and by 15 percent by 2020. Those that can't achieve the reductions, could obtain "allowances" and offsets from other sources for each ton they emit above the cap to comply with the rule.
Allowances could be bought for a to-be-determined market price from other sources in states and Canadian provinces participating in a regional cap and trade program designed by the Western Climate Initiative. New Mexico is a founding member of the WCI. An industry could also purchase an "offset" from an unregulated source anywhere in North America that has taken steps to reduce emissions.
The EIB amended the plan to include language that would allow members to consider cost containment measures if compliance with the program becomes too expensive for participants.
The board also initially approved an amendment proposed by member Greg Green to exempt the municipally owned electric utility in Farmington from the regulation. Green, who said the utility has limited options to attain compliance without hardship, withdrew his support for the cap and trade measure when the amendment was removed. Also voting against the rule were Leland Gould and Frank Simms who said while they believe climate change must be addressed, they said could not justify the economic impacts on citizens and business. "It doesn't make sense to me," Gould said.