The clean air investment fund
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THE CLEAN AIR INVESTMENT FUND PowerPoint PPT Presentation


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THE CLEAN AIR INVESTMENT FUND. BACKGROUND & KEY FEATURES. REGULATORY FOUNDATIONS. Implementation plan accompanying July 1997 presidential directive on implementing new NAAQS Chapter 9, Economic Incentive Program Guidance, January 2001. BASIC RATIONALE.

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THE CLEAN AIR INVESTMENT FUND

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The clean air investment fund

THE CLEAN AIR INVESTMENT FUND

BACKGROUND & KEY FEATURES


Regulatory foundations

REGULATORY FOUNDATIONS

  • Implementation plan accompanying July 1997 presidential directive on implementing new NAAQS

  • Chapter 9, Economic Incentive Program Guidance, January 2001


Basic rationale

BASIC RATIONALE

  • An additional air quality management tool to address high control costs based on “polluter pays” principle

  • Can assist in shifting emissions reduction burden to lower-cost sectors, especially where trading may not be feasible

  • May be used to invest in innovative technologies and programs

  • May also address distributional inequities by helping target reductions


Primary approach cost relief valve

PRIMARY APPROACH:COST RELIEF VALVE

  • State sets cost threshold for an emissions standard

  • Regulated sources pay into fund in lieu of incremental reductions that exceed control cost threshold

  • Fund administrator invests in emissions reduction projects at lower-cost, possibly unregulated, sources


Important guidance elements

IMPORTANT GUIDANCE ELEMENTS

  • COST THRESHOLD:

    • Requires analysis of potential contributing and compensating sources

    • Provides examples and options for threshold-setting methodology

  • ASSURANCES

    • Provides examples and options for covering any potential “gap” in compensating reductions


Important guidance elements cont

IMPORTANT GUIDANCE ELEMENTS (cont.)

  • REQUIRED PROVISIONS

    • Reductions must meet fundamental integrity elements

    • Design must include an automatic suspension mechanism

    • Design must demonstrate environmental benefit

    • Design should include restrictions on use of AELs


Key findings new hampshire test

KEY FINDINGS: NEW HAMPSHIRE “TEST”

  • Provides regulated sources with increased cost certainty

  • Extremely flexible re: emissions reduction standards, and size, number of targeted sources

  • Can help state or locality meet an emissions reduction goal at notably lower costs than traditional regulation


Similarly structured programs

SIMILARLY STRUCTURED PROGRAMS

  • Air Quality Investment Program (California South Coast AQMD)

  • NOx Emission Reduction Fund (New Hampshire)

  • The Climate Trust (Oregon)


An invitation

AN INVITATION

  • EPA assistance available to any state interested in developing a clean air investment fund

  • Contact:

    Brian Cook

    Department of Government, Clark University

    (508) 793-7360

    [email protected]


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