New Mexico regulators on Monday took another major step towards reducing the state's greenhouse gas emissions.
The New Mexico Environmental Improvement Board (EIB) voted to adopt a petition by New Energy Economy (NEE), creating a new state carbon pollution reduction program.
The new state pollution limit, approved by a 4-1 vote, will require the state's largest polluters to reduce their carbon dioxide (CO2) emissions by 3% per year from 2010 levels starting in 2013. The EIB ruled to amend the effective date, pushing it back one year to 2013.
The approval is the culmination of a two-year petition process started by NEE, a New Mexico-based nonprofit organization. It follows a similar vote by EIB last month to approve the states participation in the Western Climate Initiative's (WCI) carbon trading program, which aims to cap CO2 emissions 2% beginning in 2012.
The latest approval commits the state to its own program, if the WCI program fails, and it also puts New Mexico farther down the cap-and-trade path, before Republican governor elect Susana Martinez takes office and appoints more conservative regulators.
NEE Senior Policy Advisor Mariel Nanasi said the rule is designed to make it as easy and inexpensive as possible to meet the carbon reduction goals, but she said what's more important is what the rule means for New Mexico's economy.
"This new policy makes New Mexico the nation's leader in carbon pollution reduction while at the same time stimulating our economy and creating jobs for New Mexico families and communities," Nanasi said. "The board understands that the same technologies that can reduce carbon pollution can also make New Mexico more competitive in the clean energy economy, which means more long-term, well-paying jobs for New Mexicans."
The carbon reduction program applies to the state's largest polluters, stationary sources that emit more than 25,000 metric tons of carbon dioxide--primarily, electrical generating power plants, refineries, and natural gas processing and compression facilities.
The program will take effect in 2013 and will end in 2020, or sooner if a national or regional carbon pollution reduction program involving New Mexico is implemented.
The rules include provisions to keep emitters' costs down:
- An annual limit on how much emitters will have to spend to comply
- Banking, allowing emitters to hold onto credits for future use
- An "off ramp" if businesses can show that the rules will prove detrimental to their economic viability
The rule also contains provisions for a reevaluation in 2014.
New Mexico's largest utility, PNM Resources (NYSE: PNM), and the oil and gas industries sued to prevent New Energy Economy's petition from being heard by the EIB, but the New Mexico Supreme Court in an unprecedented unanimous decision overruled a lower court injunction, allowing the process to go forward.
Read additional coverage on New Mexico and the WCI at the link below.