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Presentation to RGGI StakeholdersApril 6, 2005
Steve FineChris MacCracken
ICF Consulting
RGGI Preliminary
Electricity Sector Modeling Results
Reference Case Sensitivity Results, 35% CO2 Policy Case Results & Offsets
Cases
2
Outline
RGGI CO2 Policy Cases Review + 35% Case Update
• RGGI CO2 Policy Scenarios With and Without US/Canada Policies
Alternative Reference Cases
• Alternative Reference Cases with 25% CO2 Policy
• Alternative Reference Cases - 25% CO2 Policy with US/Canada Policies
CO2 Offset Scenarios
RGGI CO2 Policy CasesReview + 35% Case Update
4
0
20
40
60
80
100
120
140
160
2006 2009 2012 2015 2018 2021 2024
Mill
ion
Ton
s
Ref
Case 2 - 10%
Case 3 - 15%
Case 4 - 25%
Case 5 - 35%
CO2 Emissions across Policy Scenarios
5
0
2
4
6
8
10
12
14
2006 2009 2012 2015 2018 2021 2024
$/T
on
Case 5 - 35%
Case 4 - 25%
Case 3 - 15%
Case 2 - 10%
CO2 Allowance Prices across Policy Scenarios
6
0
20
40
60
80
100
120
2006 2009 2012 2015 2018 2021 2024
TW
h
Ref Case 2 - 10% Case 3 - 15%
Case 4 - 25% Case 5 - 35%
RGGI Imports across Policy Scenarios
7
RGGI Average Annual Energy Prices
$20
$25
$30
$35
$40
$45
$50
$55
2006 2009 2012 2015 2018 2021 2024
$/M
Wh
Ref Case 2 - 10% Case 3 - 15%
Case 4 - 25% Case 5 - 35%
8
RGGI Energy Price ImpactsChange Relative to Reference Case
0%
2%
4%
6%
8%
10%
12%
2006 2009 2012 2015 2018 2021 2024
Ch
ang
e in
En
erg
y P
rice
Case 2 - 10%
Case 3 - 15%
Case 4 - 25%
Case 5 - 35%
RGGI CO2 Policy ScenariosWith and Without US/Canada
Policies
10
0
5
10
15
20
25
2006 2009 2012 2015 2018 2021 2024
$/T
on
25% RGGI 35% RGGI
25% RGGI US/CAN 35% RGGI US/CAN
CO2 Allowance Prices25 and 35% Cases w/ and w/o US/Can
11
$20
$25
$30
$35
$40
$45
$50
$55
2006 2009 2012 2015 2018 2021 2024
$/M
Wh
Ref 25% RGGI
35% RGGI 25% RGGI US/CAN
35% RGGI US/CAN
RGGI Average Annual Energy Prices 25 and 35% Cases w/ and w/o US/Can
12
0%
5%
10%
15%
20%
25%
30%
35%
2006 2009 2012 2015 2018 2021 2024
Ch
ang
e in
En
erg
y P
rice
25% RGGI
25% RGGI US/CAN
35% RGGI
35% RGGI US/CAN
RGGI Energy Price Impacts - Change Relative to Ref Case 25 and 35% Cases w/ and w/o US/Can
Alternative Reference Cases
14
Alternative Reference Case Specifications
Case Description
Low Emissions Reference Case
(Low)
Incremental electric demand growth in RGGI states reduced by 30%
Reference(Ref)
Standard RGGI Reference Case
High Emissions Reference Case
(High)
Gas prices flat at $6.50/MMBtu (real)over all years
New coal capacity allowed in RGGI regions (excluding urban areas)
15
0
5
10
15
20
25
30
35
40
45
Ref. High Low Ref. High Low
2015 2024
Cu
mul
ativ
e G
W
Other
Coal
Gas
RGGI Build Mix Across Reference CasesCumulative through 2015 and 2024
16
0
20
40
60
80
100
120
140
160
180
200
2006 2009 2012 2015 2018 2021 2024
Mill
ion
Ton
s
Ref Low High
CO2 Emissions Across Alternate Reference Cases
17
0
10
20
30
40
50
60
70
80
90
100
2006 2009 2012 2015 2018 2021 2024
TW
h
Ref Low High
RGGI Imports Across Alternate Reference Cases
18
RGGI Average Annual Energy Prices
$20
$25
$30
$35
$40
$45
$50
$55
2006 2009 2012 2015 2018 2021 2024
$/M
Wh
Ref Low High
Alternative Reference Cases25% CO2 Policy
20
RGGI CO2 EmissionsReference vs. 25% Policy Cases
0
20
40
60
80
100
120
140
160
180
200
2006 2009 2012 2015 2018 2021 2024
Mill
ion
Ton
s
Low - 25% CO2 Ref - 25% CO2 High - 25% CO2
Ref.
High
Low
21
RGGI CO2 Allowance Prices
0
2
4
6
8
10
12
14
16
18
20
2006 2009 2012 2015 2018 2021 2024
$/T
on
Ref - 25% CO2
High - 25% CO2
Low - 25% CO2
22
RGGI Imports
0
20
40
60
80
100
120
2006 2009 2012 2015 2018 2021 2024
TW
h
Low - 25% CO2 Ref - 25% CO2 High - 25% CO2
Ref.
High
Low
23
RGGI Annual Average Energy Prices
$20
$25
$30
$35
$40
$45
$50
$55
$60
2006 2009 2012 2015 2018 2021 2024
$/M
Wh
Low - 25% CO2 Ref - 25% CO2 High - 25% CO2
Ref./Low
High
Alternative Reference Cases25% CO2 Policy with US/CANADA
25
RGGI CO2 Allowance Prices
0
5
10
15
20
25
30
35
40
45
2006
2009
2012
2015
2018
2021
2024
$/T
on
High - 25% US/CAN
Ref - 25% US/CAN
Low - 25% US/CAN
0
5
10
15
20
25
30
35
40
45
2006
2009
2012
2015
2018
2021
2024
$/T
on
Ref - 25% CO2
High - 25% CO2
Low - 25% CO2
25% Policies without US/Canada 25% Policies with US/Canada
26
RGGI Annual Average Energy Prices
$20
$25
$30
$35
$40
$45
$50
$55
$60
$65
$70
2006
2009
2012
2015
2018
2021
2024
$/M
Wh
High - 25% CO2Ref - 25% CO2Low - 25% CO2
Ref./Lo
High
$20
$25
$30
$35
$40
$45
$50
$55
$60
$65
$70
2006
2009
2012
2015
2018
2021
2024
$/M
Wh
High - 25% US/CAN
Ref - 25% US/CAN
Low - 25% US/CAN
25% Policies without US/Canada 25% Policies with US/Canada
CO2 Offset Scenarios25% CO2 Policy with US/Canada
28
Offset Scenario Specifications
Scenario CO2 Policy Offset Allowances
Clean Development Mechanism (CDM) 25% Reduction in
RGGI
2015 Stabilization in Rest of U.S.
2008 Stabilization in Canada
$6.50/ton CO2 Backstop in RGGI, U.S. and
Canada
RGGI Offset Supply Curve (Curve)
Offset supply curve implemented for RGGI
No offsets in U.S. or Canada
All offset scenarios run off of standard Reference Case
29
RGGI Offset Supply Curve2015 Curve Shown
$0
$2
$4
$6
$8
$10
$12
$14
$16
6.00 6.50 7.00 7.50 8.00 8.50
Million Tons CO2
2003
$/T
on
30
RGGI CO2 Emissions25% CO2 Case with US/Canada
0
20
40
60
80
100
120
140
160
2006 2009 2012 2015 2018 2021 2024
Mill
ion
Ton
s
Ref
25% US/CAN
CDM-25% US/CAN
Curve-25% US/CAN
31
RGGI CO2 Allowance Prices25% CO2 Case with US/Canada
0
2
4
6
8
10
12
14
16
18
2006 2009 2012 2015 2018 2021 2024
$/T
on
25% US/CAN
CDM-25% US/CAN
Curve-25% US/CAN
32
RGGI Imports25% CO2 Case with US/Canada
0
10
20
30
40
50
60
70
80
90
100
2006 2009 2012 2015 2018 2021 2024
TW
h
Ref
25% US/CAN
CDM-25% US/CAN
Curve-25% US/CAN
33
RGGI Annual Average Energy Prices25% CO2 Case with US/Canada
$0
$10
$20
$30
$40
$50
$60
2006 2009 2012 2015 2018 2021 2024
$/M
Wh
Ref
25% US/CAN
CDM-25% US/CAN
Curve-25% US/CAN
34
Impact on RGGI Annual Average Energy PriceRelative to Reference Case
0%
5%
10%
15%
20%
25%
30%
2006 2009 2012 2015 2018 2021 2024
Ch
ang
e in
En
erg
y P
rice
25% US/CAN
CDM-25% US/CAN
Curve-25% US/CAN
Appendix
36
0
20
40
60
80
100
120
2006 2009 2012 2015 2018 2021 2024
TW
h
Ref 25% RGGI
35% RGGI 25% RGGI US/CAN
35% RGGI US/CAN
RGGI Imports 25 and 35% Cases w/ and w/o US/Can
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