Ten years ago last month, Maine joined the Regional Greenhouse Gas Initiative. This historic, market-based initiative among nine states puts a limit on climate-changing carbon pollution from power plants. It has been a remarkable success by any measure. Now, the states are nearing the end of a periodic review of the program. Maine leaders at that table must work to strengthen the program to ensure it continues benefiting Maine’s environment, economy and energy consumers.
As two home energy improvement business owners, we care about the greenhouse gas initiative because the proceeds from it support energy efficiency initiatives through the Efficiency Maine Trust. It sets an annual cap on carbon dioxide emissions from large power plants in the North East. Power generators can buy and sell emission allowances at an annual auction under the program, and that revenue goes back to the states. Since the initiative’s inception, Maine has received $86 million from carbon auctions. A significant portion of that goes to programs helping Mainers invest in cost-effective weatherization and heating efficiency improvements for their homes.
That’s where companies like ours come in. We provide clear information to homeowners about opportunities for energy efficiency improvements and put those solutions to work in Maine homes every day.
For example, just recently Penobscot Home Performance completed a project for a Down East couple whose leaky and poorly insulated attic and bathroom were making their rooms frigid and causing severe ice dams on their roof. The Breathable Home helped a client whose mobile home had suffered from freezing pipes for 20 years. Using funds from the Low-Income Home Energy Savings Program, which is funded by the initiative, we were able to insulate the crawlspace to keep the pipes — and her floor — nice and warm.
Modest financial incentives from Efficiency Maine are great news for homeowners and for the state as a whole, as we collectively chip away at Maine’s risky dependence on imported heating oil. Last year, Efficiency Maine’s Home Energy Savings Program invested about $4 million, mostly from the greenhouse gas initiative, to leverage $16 million in private homeowner investments and create $30 million in heating oil savings. That’s a fantastic deal for the state.
The initiative funds that flow through Efficiency Maine also are helping companies like ours to create and sustain good jobs. In 2017, The Breathable Home invested in a new, high-efficiency spray foam machine and hired two employees with health and retirement benefits. Penobscot Home Performance has grown from two people to a seasonal high of nine. We both rely on stable energy-efficiency policy to keep making investments in our company and employees.
Of course, the initiative is primarily designed to lower carbon pollution, and it has done that, too. Power plant carbon pollution has been reduced by 37 percent since the initiative started. Given the Trump administration’s climate-protection rollbacks, it is more important than ever that states and regions succeed at reducing emissions. In fact, the initiative’s pollution reductions have exceeded expectations, with annual emissions reductions exceeding the current target of 2.5 percent per year.
That is good news. But not taking advantage of the program’s potential has led to a weak market for carbon credits and less incentive for power plants to decrease their carbon pollution. It means Maine is receiving 50 percent less revenue from the initiative than was forecasted a year ago.
States are considering keeping the new carbon cap reduction at the current 2.5 percent per year for 2020 and beyond. But under this weak option Mainers would lose out on millions in energy savings, and there would be more pollution, too. We were disappointed to hear Maine officials are leaning toward this option. This option is not in Maine’s best interest, and it is out of line where other states in the region — including those led by Republican governors — are leaning.
A stronger option that states also are considering would set the cap at 3.5 percent to reduce pollution more quickly, creating a stronger carbon market. Under this scenario, Maine would receive about $45 million more for efficiency funding over the next five years than option toward which Maine officials lean. Given our record of saving $6 for every $1 received, these would translate into enormous savings — about $250 million — for homes and businesses.
Maine should be proud of its participation in this initiative. Energy consumers and businesses like ours clearly benefit. Reducing the initiative’s revenues through inaction will harm our businesses, employees and communities. We urge Maine officials to work with the other states to adopt changes that expand these benefits. Maine deserves better than energy efficiency rollbacks and weak efforts to protect our climate.
Matt Damon is co-founder of Penobscot Home Performance in Bucksport. Bo Jesperson is the founder of The Breathable Home in Augusta.