I went to this weird meeting yesterday, sponsored by DNREC, regarding Delaware’s participation in the “Regional Greenhouse Gas Initiative,” or RGGI. Here’s the:

RGGI Document List.

The purpose of the meeting, one of a series, was to address “The Allocation Issue” and “The Revenue Issue.” The “Allocation Issue” is DNREC wanting to figure out how to GIVE all the credits to the utilities, and “The Revenue Issue” is wanting to shift any revenue if any are auctioned rather than given, to Delaware’s “Sustainable Energy Utility” which is supposed to be the state entity to handle conservation and efficiency. But even the chair, David Small of DNREC, was frustrated because this meeting, as with the others, was all going around and around and around. To me, that indicates two things, that there is not enough information in the possession of the ’rounders to see clearly, and two, that there is not agreement with the agenda of those pushing for “consensus.” Then, with “consensus,” they’d put a bill together and march it through the legislature.

What was weird about it was that among those present, other than utilities and politicians with a vested interest, they didn’t seem to know enough about the system and valuation of CO2 to make a decision. There was some speculation, but it wasn’t even based on market rates in the markets already in existence:

Click here for CCX and ECX

It wasn’t based on the cost estimates made in other jurisdictions. The one chart showing “Potential Auction Revenue per year” had values of $2-5/ton, but as we saw in Minnesota, expect $9-30/ton.

Here’s a Motion for Reconsideration in the Big Stone II case that has a wide range of values, going far higher than the $2-5 that DNREC predicts:

Big Stone II – Application for Reconsideration II

Here’s the Minnesota PUC Order:

PUC’s CO2 valuation

I’m tempted to say it was like the blind leading the blind, but it was more like the ones with an interest leading those without sufficient information trying to force a decision. This is a job that the legislature should assign to the PSC, the ones with the expertise to address these policy issues.

Oh, and the “gotcha” part was the utilities, which in Delaware are not regulated, crying and begging and whining for this gift of credits. Ummmmmm… you’re unregulated, you’ve been enjoying the benefits to utilities of unfettered profit-taking, and now you want the state to GIVE utilities CO2 credits? Ummmm… hello, the market is working and it’s time you pony up! I love it when “free marketers” cry for regulation. And that brings up the bottom line in Delaware — it’s time to repeal deregulation.

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