August 31, 2017 Read More →

A State Trend Toward Ignoring Trump Emission-Regulations Rollbacks

Utility Dive:

The Trump administration is abdicating Obama-era climate regulations, but a small — and growing — amount of states are taking matters into their own hands.

The weapon of choice? The federal social cost of carbon, developed by the former Obama administration’s interagency working group composed of federal scientists and economists.

The way it works is that it monetizes the net damages of carbon dioxide emissions, necessitating the cost to be expressed as a range of dollar values.

The latest state to use such a standard — or at least be in the center of a debate — is Minnesota. The state recently updated its cost of carbon standards, after determining that the previous estimate was too low, and used the federal social cost of carbon as the basis.

The New York Public Service Commission is another entity that affirmed the importance of the social cost of carbon through its zero-emission credits (ZECs) and other policy calculations. And Illinois lawmakers also incorporated the social cost of carbon in a ZEC calculation upheld by the state courts.

California is also considering using the cost of carbon as part of its comprehensive energy and climate programs. All told, the United States government utilized the social cost of carbon in more than 150 proposed and final regulatory measures, according to according to environmental policy advocates Resources for the Future (RFF). And support gained momentum when Colorado became the first state to impose a regulatory requirement that utilities use it in resource planning.

But that momentum was lost when a presidential executive order disbanded the working group in March. President Donald Trump’s order also specified that the social cost of carbon is no longer governmental policy, wrote RFF Fellow Casey J. Wichman. Its rollbacks and guidance “indicate that the Trump administration is disengaging from scientific questions related to the benefits of emissions reductions.”

Still, that does not appear to be the case with some utilities. In the Minnesota proceeding, Nicholas Martin, the environmental policy manager for Xcel Energy noted the utility supports “bold action” on carbon reduction. In contrast to the Trump administration, Xcel “does not question” the science of climate change, the legitimacy of externality pricing, or even the social cost of carbon “when it is used for its intended purpose,” Martin said.

Even so, Martin reflected some doubt when he expressed concern over how the PUC would use the social cost of carbon.

“Its values may be fine for federal regulatory impact analysis but the question is what is reasonable and best available for resource planning,” he said.

Despite his qualms, it’s clear these suite of state actions reveal a trend where states are looking to price carbon and quantify social costs for decarbonization purposes.

More: Carbon calculus: More states are adding carbon costs to utility planning guidelines

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