New York is considering adding a carbon tax to power providers already operating under the state’s cap-and-trade system to cut emissions.
The New York Independent System Operator (NYISO), the state’s grid authority, released a “straw proposal” Monday for placing a per-ton charge on the carbon emissions of the state’s power plants. The charge would be tacked on during emissions auctions already required by New York’s participation in the Regional Greenhouse Gas Initiative (RGGI), a coalition of nine states that have enacted cap-and-trade systems, E&E News reports.
“NYISO’s draft proposal for a carbon adder would send an important and overdue price signal to the market necessary for New York to achieve its ambitious carbon reduction policies in place to meet long-term greenhouse gas reduction targets,” Acadia Center, a clean energy advocacy group, Massachusetts Director Deborah Donovan told E&E.
In order to maintain the market-based approach to emissions reductions, power imported from outside the state would be subject to the carbon tax while power exported from the state would not.
New York Attorney General Eric Schneiderman became the first New York official to endorse a carbon tax in December. Democratic Gov. Andrew Cuomo withheld support of the tax, fearing increased costs on generators would increase state energy prices and make New York less competitive in the energy market.
Pressure has mounted on the New York governor to change his position. More than 150 state officials sent a letter to Cuomo in early March petitioning for a carbon tax. Cuomo has previously recommended higher investment in wind energy to cut carbon emissions and meet goals the governor set.
Cuomo aims to have the New York’s emissions 40 percent lower by 2030 than they were in 2005.
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