DEES tells lawmakers RGGI changes needed to preserve customer rebates; cites tens of millions rebated to ratepayers

The Department of Environmental Services told the House Science, Technology & Energy Committee on Jan. 14 that New Hampshire needs statutory housekeeping to remain an active participant in the Regional Greenhouse Gas Initiative (RGGI) and maintain the flow of allowance proceeds used for energy-efficiency programs and direct electric-bill rebates.

Adam Crapo, assistant commissioner at DEES, told the panel that a combination of statute and rule changes is required so the state can continue in the regional cap-and-trade auction market. "If we don't participate, we actually lose money and our rates go up," Crapo said, arguing that participation delivers direct customer rebates and first-dollar funding for energy-efficiency programs.

DEES air-division director Craig Wright described how RGGI works: the program sets a regional CO2 cap, auctions allowances to compliance entities and allows a secondary market for trading. Wright said the 2025 program review led the ten RGGI states to agree on several program adjustments, including increasing the size of the cost-containment reserve (CCR) and adding a second CCR level to ease price spikes in auctions.

Wright and Crapo walked members through several charts comparing New Hampshire's share of retail electricity consumption versus the share of allowances the state receives, noting that in the ISO New England footprint the state receives a larger share of allowances than its retail sales alone would suggest. Members asked whether higher allowance prices have changed the split between the statutory "first dollar" for efficiency programs and the remainder rebated to consumers; DEES said that as allowance clearing prices rise, that statutory first-dollar share becomes a smaller percentage of total allowance proceeds even if the dollar amount grows.

Members pressed DEES on auction price drivers, investor participation and the consumer protections in place. DEES officials emphasized the role of market dynamics in setting prices and said price spikes were one reason the regional partners agreed to expand the CCR. On transparency and accountability in how auction proceeds are spent, DEES said that state statute prescribes the first-dollar allocation to energy-efficiency and the balance (less administrative costs) to ratepayer rebates, and that the department and the Department of Energy (DOE) will provide more detailed reporting.

What happens next

DEES said it will bring a draft statutory implementer and share 2025 data with the committee. The RGGI changes are tied to an expected bill the department expects will be heard later in session; committee members asked DEES staff for more detailed reporting in advance of that hearing.

Speakers attributed

- Adam Crapo, Assistant Commissioner, Department of Environmental Services - Craig Wright, Air Division Director, Department of Environmental Services

Provenance: topicintro SEG 022; topfinish SEG 468