Let's think about the Regional Greenhouse Gas Initiative (RGGI, which the cool kids pronounce Reggie, I gather) the first-in-the-nation CO2 cap-and-trade program that Massachusetts co-founded. By the way, like many people who grew up in Britain in the 1970s, I can't hear the name Reggie without thinking of Reggie Perrin. Hence the picture.
But first a word about Gaia.
In Greek mythology, Gaia was a deity, a goddess representing the Earth. The Gaia theory claims that Earth is a single, complex superorganism that regulates its environment the way an animal regulates its body temperature and chemical balance.
Gaia the theory (the theory about the very real natural world) owes its name to Gaia the goddess, an imaginary inhabitant of an imaginary supernatural world.
I was reading The Guardian earlier this week and I noticed that James Lovelock, the environmental scientist who came up with the Gaia theory, has compared market systems that resemble cap-and-trade programs to slavery. Lovelock was at a debate on biodiversity sponsored by the journal Nature, and he was responding to the idea of putting a price on the “ecosystem services” that oceans and rivers provide. That seems to be a growing line of business, by the way.
This is what Lovelock said, according to The Guardian: “To talk of these ecosystems as something we can own and draw benefits from, and buy and sell, is just like the attitude not so long ago to slavery, and just as reprehensible.”
Lovelock also mentioned the ease with which cap-and-trade systems degenerate into “scams” (his word) that benefit industry but don’t benefit life on Earth.
Massachusetts participates in Reggie and for a while now I’ve been curious about its effectiveness. I grew more curious and, to be honest, a tad suspicious, when I read Governor Deval Patrick’s press release about how Massachusetts was going to spend its Reggie winnings.
What do I mean by “winnings”?
You already know how Reggie works, I suppose, but here is a brief refresher. Under Reggie, the participating states sell a finite number of pollution permits. A company needs a permit for every ton of carbon dioxide it emits. Over time, the states reduce the number of pollution permits. The number of permits drops and, hey presto, the amount of CO2 drops as well.
Energy companies pay for the permits at auctions, and each participating state gets a share of the auction proceeds, which I crassly refer to as “winnings.” What happens to the winnings after the state governments get their hands on the cash? That’s what I was (and still am) curious about.
After the December 2008 Reggie auction, Governor Patrick announced that the Department of Public Utilities would be dedicating $5.9 million “for the state’s electric and natural gas utilities to aggressively expand their energy efficiency programs this year to help consumers reduce their winter heating bills.”
What struck me was the possibility that what the utilities giveth in the auction, the utilities taketh away soon after.
So on January 19, 2009, I wrote the Department of Public Utilities (DPU) with the following simple request:
On reading the Governor’s press release regarding the December RGGI auction, I notice that the Department will be dedicating $5.9 million “for the state’s electric and natural gas utilities to aggressively expand their energy efficiency programs this year to help consumers reduce their winter heating bills.” Please let me know whether this means that the utility companies will receive the $5.9 million.
A few weeks went by, with no reply from DPU. So on February 8, I asked again, this time by way of a public records request under Mass General Laws Chapter 66 Section 10, and I received a prompt response from the Legal Division.
You can read the letter if you like, but this is the gist: look online.
I did. I went to the site as directed, looked through the wealth of documents, and could not find out how much the private utilities are raking in from the public's auction winnings. Given my regular inability to locate the ketchup in the refrigerator, this may be another case of me not looking long enough or in the right place.
Alternatively, it really is hard to find, or simply not there.
By the way, I called the attorney who signed the Department of Public Utilities letter and she told me that she’d gotten the information from another attorney, but it’s probably not the Department of Public Utilities that has those records anyway. The Department of Energy Resources (DOER) is the department that actually spends the Reggie winnings.
I have sent my public records request to DOER and I’ll let you know what they say.
In the meantime, it’s worth double-checking the Public Utilities site, and I would appreciate it if you would help me to follow the money.
Here’s my request. Go online to the Commonwealth’s website, www.mass.gov, click on Utility Regulatory Energy Efficiency, then choose “electric energy efficiency dockets,” and check out the 2008 energy-efficiency plans.
If you can find details of the Reggie funds, please let me know. And if you cannot, please let me know.
By the way, Reggie is not an ecosystem-services program, the kind of thing that James Lovelock was having a go at. It’s a cap-and-trade program. But there are similarities. Most importantly both are rooted in faith, faith in markets and the ability of markets to solve problems.
I can see the appeal. After all, it was humans acting through markets that created the problem, so why shouldn’t humans acting through markets be able to solve it?
Well, sometimes markets work and sometimes they don’t, not that you need reminding of that during the current recession.
How can we tell whether a market-based program – like Reggie – is working toward the common good or (as the market skeptics among us might suspect) working to the disproportionate advantage of the private industries it’s supposed to be helping control?
I’m a lawyer and, when it comes to proving things, lawyers prefer evidence to faith.