Maryland regulators are considering exemptions for a proposed Calvert County power plant and other generators from a regional auction of carbon credits that is designed to reduce greenhouse gas emissions.
The idea of granting free carbon credits to potential polluters had rankled some environmentalists and state lawmakers, but Maryland's projected energy shortage is so acute that many now support the idea as a way to get new electricity online and to head off potential rolling blackouts.
Gov. Martin O'Malley's administration has been working to address the state's energy needs while revamping environmental laws, and the concession is the latest nod to a balancing act that officials say is required among economic, corporate and ecological concerns.
The Democratic governor signed several environmental and energy bills yesterday, including legislation that sets out how to spend the regional auction proceeds, limits development near the Chesapeake Bay and establishes "green" building standards for new schools. O'Malley also signed a bill ratifying an agreement with Constellation Energy Group that provides $170, one-time rebates to residential customers of Baltimore Gas & Electric Co.
"The imperative is to create a more sustainable future for our state in terms of the land, the air, the water that we use and also therefore the energy that we use," O'Malley said during the bill-signing ceremony in Annapolis.
The administration won approval during this year's General Assembly session of proposals intended to reduce the state's reliance on fossil fuels and costs for consumers.
Carbon credit auction proceeds, for example, will go to energy efficiency and conservation programs meant to lower electricity usage and bills. Another bill O'Malley signed yesterday will increase grants for solar energy and geothermal heat pump systems for homes.
The new laws also set out a number of long-range goals. They aim to reduce the state's energy consumption 15 percent by 2015 and to double the amount of renewable energy that power companies must provide for sale to customers to 20 percent by 2022.
The Constellation settlement is valued at $2 billion and ends a legal battle with the state. In addition to the credits, consumers would no longer be obligated to pay $1.5 billion in future costs for dismantling nuclear power plants in Southern Maryland, as had been stipulated as part of the state's 1999 deregulation plan.
