Incorporating Wind in Cap and Trade Programs
There are various methods of allocating allowances to renewable energy sources under cap and trade programs, such as renewable energy set asides and output-based approaches. Background materials and presentations from the January 12, 2006 Webcast below, provide information on why it is important to include wind and other renewables in cap and trade programs and how best to incorporate them.
Bird, L.; Holt, E.; Carroll, G. National Renewable Energy Laboratory, April 2007.
January 12, 2006 Webcast: Incorporating Renewable Energy under the Clean Air Interstate Rule (CAIR)
Joel Bluestein, Energy and Environmental Analysis, Inc.
Sharon Weber, Massachusetts Department of Environmental Protection
Joe Bryson, U.S. Environmental Protection Agency, Climate Protection Partnerships Division
Kevin Rackstraw, Clipper Windpower, Inc.
State Energy Office Perspective: What is the role for State Energy Offices in Integrating Renewables and Air Quality Goals?
Sara Ward, Ohio Energy Office
- Bluestein, J., Salerno, E., Bird, L., Vimmerstedt, L. (July 2006). "Incorporating Wind Generation in Cap and Trade Programs."
- Under the current NOx Budget Trading Program SIP Call, seven states have incorporated a renewable energy allowance set-aside. An overview of the seven programs was produced by the EPA is available.
- The EPA provides a variety of guidance documents on incorporating renewables in emission control programs
- STAPPA/ALAPCO developed language for Alternative NOx Allowance Allocation under the Clean Air Interstate Rule, which includes allocation methods for renewable energy.
- Environmental Resource Trust (Resource Systems Group) completed a dispatch analysis to determine real emissions displacement rates in the PJM and PJM West Areas
Background on the Clean Air Interstate Rule
Issued by the U.S. EPA on March 10, 2005, the Clean Air Interstate Rule (CAIR) calls for significant reductions in emissions of sulfur dioxide (SO2) and nitrogen oxides (NOx) in 28 eastern states and the District of Columbia. States must achieve the required emission reductions using one of two compliance options: 1) meet the state's emission budget by requiring power plants to participate in an EPA-administered interstate cap and trade system, or 2) meet an individual state emissions budget through measures of the state's choosing. States must submit State Implementation Plans (SIPs) for CAIR by the end of 2006. For additional information, please see the U.S. Environmental Protection Agency's CAIR Web site.