New Hampshire Passes Nation's First CO2 Cap

By Cat Lazaroff

CONCORD, New Hampshire, April 22, 2002 (ENS) - New Hampshire has become the first state to pass legislation aimed at reducing emissions of carbon dioxide, one of the so called greenhouse gases linked to global warming. State officials said they hope that other states, and the federal government, will follow New Hampshire's example and take action to curb climate change.

With a 21-2 vote, the New Hampshire Senate passed the Clean Power Act, a bipartisan bill aimed at cleaning up emissions from the state's three fossil fuel burning power plants. The legislation makes New Hampshire the first state in the nation to legislate a reduction in four common pollutants from power plants, including carbon dioxide.


New Hampshire Governor Jeanne Shaheen championed the nation's first power plant emissions bill that caps carbon dioxide (CO2) emissions. (Photo courtesy National Governors Association)
"Cleaning our air is essential to protecting the health of our citizens, preserving our environment and ensuring our future state's future economic success," said Governor Jeanne Shaheen. "This is a landmark step for clean air, putting New Hampshire out in front of the rest of the nation in acting to protect air."

The House has already passed the bill, which Governor Shaheen has promised to sign into law.

"With this legislation, New Hampshire is sending a powerful message to other states and the federal government," Shaheen added. "Pollution does not respect state boundaries. Other states and the federal government must follow our lead so that downwind states like New Hampshire have clean air."

Public Service Company of New Hampshire (PSNH), the owner of the state's three fossil fuel power plants, endorsed the bill, as did several conservation groups.

"This agreement is a clear demonstration of the continued leadership on clean air policy by the state of New Hampshire, PSNH, and key environmental organizations," said Gary Long, PSNH president and chief operating officer, announcing the company's support for the bill last November. "It is a 'first in the nation' accomplishment. No other state in the nation has achieved such a comprehensive agreement - one which addresses the reduction of these four major pollutants."

Under the Clean Power Act, PSNH must take steps to reduce emissions of carbon dioxide, sulfur dioxide, nitrogen oxides and mercury.

The Act requires that carbon dioxide emissions be cut by about three percent, back to 1990 levels. The bill provides for future requirements that emissions be cut by an additional seven percent below 1990 levels, the amount called for in the international Kyoto treaty on climate change.

The Bush administration has withdrawn U.S. support for the Kyoto Protocol, an international agreement to curb the emission of greenhouse gases linked to global warming.


Gary Long, president and chief operating officer of the Public Service Company of New Hampshire, which sponsored the bill. (Photo courtesy PSNH)
By 2007, PSNH must slash sulfur dioxide emissions, the chief component of acid rain and airborne soot, by 75 percent below federal requirements that took effect in 2000. Also by 2007, nitrogen oxide emissions, which cause smog and acid rain, must be cut by 70 percent, which will reduce this pollution to 90 percent lower than 1990 levels.

The bill requires the company to measure mercury emissions at its three coal burning power plants. A cap on mercury emissions will be established after the U.S. Environmental Protection Agency issues its new power plant emissions standard for mercury, due out next year.

If PSNH cannot meet these new standards with actual emissions reductions, it can buy pollution credits from utilities in other states that have already reduced their emissions.

Critics of the legislation argue that the bill does not assure actual emissions reductions within New Hampshire's borders, because PSNH could buy pollution credits instead of installing emissions control technology.

To help alleviate those concerns, the final version of the bill includes incentives for PSNH to make their pollution reductions either in New Hampshire or nearby, where New Hampshire citizens will benefit the most from the reduced pollution. The bill makes it more expensive for the utility to buy credits from power plants outside the region, making it more likely that the credits will be bought from cleaner power plants in upwind states.

"Using trading to meet the emissions targets means that the upwind sources of pollution will have reduced access to the same credits, which will have a beneficial effect on the amount of pollution transported to New Hampshire," states Governor Shaheen's office.

PSNH said in November that it expects to meet the requirements of the Act through a combination of emission reductions and the purchase of sulfur emission credits. Based on today's price for such credits, the company estimates a cost of about $5 million per year, which could add about 40 cents a month to the average household electric bill.


Merrimack Station in Bow, New Hampshire, is one of three coal burning power plants that will have to meet the state's new emissions standards. (Photo courtesy Northeast Utilities System)
"Pollution does not respect geographical boundaries," said PSNH's Long. "We will utilize the trading system, when appropriate, because it makes sense, from both an environmental and economical perspective."

If the bill had not included emissions trading, industry experts said the costs of installing state of the art pollution controls at the three PSNH plants could have forced the closure of the plants, which employ more than 1,200 people and provide enough power for about 500,000 homes.

"The challenge has been achieving the delicate balance between protecting our environment and providing power at an economic cost. This agreement accomplishes that," noted Long. "Long term, we expect continued air quality improvements and the ability to reliably meet regional energy requirements - and, importantly, the agreement preserves the economic value to the New Hampshire communities in which our power plants reside."

Governor Shaheen said the agreement should provide a model for other states to follow.

"New Hampshire has shown that it can be done," Shaheen concluded. "We brought people together, Republicans and Democrats, business and environmentalists, to find a common sense solution that would work."