Enhancing Compliance Flexibility under the Clean Power Plan: A Common Elements Approach to Capturing Low-Cost Emissions Reductions

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2015-03-16

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Abstract

As states and stakeholders evaluate compliance options under the U.S. Environmental Protection Agency’s proposed Clean Power Plan, many recognize the potential economic benefits of market-based strategies. In some states, however, market approaches trigger administrative and political hurdles. A new policy brief by the Nicholas Institute for Environmental Policy Solutions offers a compliance pathway that allows states to realize the advantages of multistate and market-based solutions without mandating either strategy. With the common elements approach, states develop individual-state plans to achieve their unique emissions targets and give power plant owners the option to participate in cross-state emissions markets. Power plant owners can transfer low-cost emissions reductions between states whose compliance plans share common elements--credits defined the same way and mechanisms to protect against double counting. The common elements approach offers the following benefits: (1) allows cross-state credit transfers without states negotiating a formal regional trading scheme, (2) leaves compliance choices to power companies, (3) builds on existing state and federal trading programs, and (4) maintains the traditional roles of state energy and environmental regulators.

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Monast, Jonas, Timothy Profeta, Jeremy Tarr and Brian Murray (2015). Enhancing Compliance Flexibility under the Clean Power Plan: A Common Elements Approach to Capturing Low-Cost Emissions Reductions. Retrieved from https://hdl.handle.net/10161/31708.

Scholars@Duke

Profeta

Timothy H Profeta

Associate Professor of the Practice in the Sanford School of Public Policy

Tim Profeta is a senior fellow at Duke University’s Nicholas Institute for Energy, Environment & Sustainability and associate professor of the practice at Duke’s Sanford School of Public Policy.

In 2023, Profeta returned to Duke from two years of service at the U.S. Environmental Protection Agency, where he served as the special counsel for the power sector and a senior advisor. At the Agency, Profeta had a lead role in the development of the regulatory strategy affecting the power sector, including the recent proposed greenhouse gas regulations, served as a liaison between the Agency and other federal departments and agencies regarding power sector policies, and took an instrumental role in the design of several Agency programs that were authorized in the 2022 Inflation Reduction Act.  

Prior to leaving for EPA, Profeta was the founding director of the Nicholas Institute for Environmental Policy Solutions, which merged with the Duke University Energy Initiative in 2021 to create the Nicholas Institute for Energy, Environment & Sustainability. Since its creation in 2005, the Nicholas Institute has grown into a major nonpartisan player in key environmental debates, serving both the public and private sectors with sound understanding of complex environmental issues.

Profeta’s areas of expertise include climate change and energy policy, the Clean Air Act, and adaptive use of current environmental laws to address evolving environmental challenges. His work at the Nicholas Institute has included numerous legislative and executive branch proposals to mitigate climate change, including providing Congressional testimony several times on his work at Duke University, developing multiple legislative proposals for cost containment and economic efficiency in greenhouse gas mitigation programs, and facilitating climate and energy policy design processes for several U.S. states.

Prior to his arrival at Duke, Profeta served as counsel for the environment to Sen. Joseph Lieberman. As Lieberman’s counsel, he was a principal architect of the Lieberman-McCain Climate Stewardship Act of 2003. He also represented Lieberman in legislative negotiations pertaining to environmental and energy issues, as well as coordinating the senator’s energy and environmental portfolio during his runs for national office. Profeta has continued to build on his Washington experience to engage in the most pertinent debates surrounding climate change and energy.

Profeta is a member of the Climate Action Reserve Board of Directors, and is a member of The American Law Institute.

Profeta earned a J.D., magna cum laude, and a master's in environmental management in resource ecology from Duke in 1997 and a Bachelor's degree in political science from Yale University in 1992.

Murray

Brian Murray

Research Professor in the Division of Environmental Sciences and Policy

Dr. Brian C. Murray is Director of the Nicholas Institute for Energy, Environment & Sustainability, Research Professor at the Nicholas School of the Environment (primary) and Sanford School of Public Policy (secondary), and Faculty Associate of the Duke Initiative for Science & Society. In 2015 he was Fulbright Visiting Research Chair in Environment and Economy at University of Ottawa’s Institute of the Environment.  He is widely recognized for his work on the economics of energy and climate change policy, including the design of market based mechanisms to reduce greenhouse gases and deploy low-carbon energy. Members of the United States Congress, state legislators and regulators have sought the counsel of Dr. Murray and colleagues in developing energy and climate legislative proposals and regulatory options.  Their development of the cost containment reserve mechanism is now in use in several greenhouse cap-and-trade programs in North America.  Dr. Murray has been invited as a co-author of several national and international assessments of natural resources, especially related to energy and climate change. Of particular note, he serves on a National Academy of Sciences panel on greenhouse gases and the tax code, where he led the panel’s efforts on biofuel subsidies.  He was a convening lead author of the Intergovernmental Panel on Climate Change’s Special Report on Land Use, Land Use Change, and Forestry. He has convened several forums of economic modeling experts to examine and communicate the results of their climate, energy and land use policy efforts to the public and private sectors.  His research has examined the economic effects of traditional command-based regulatory strategies for pollution control and more market-oriented approaches such as cap-and-trade programs and emission taxes.  He has been a consultant to a wide range of clientele in the public and private sector, including numerous federal government agencies, members of Congress and their staff, state regulatory agencies, CEOs and senior staff from Fortune 500 companies, trade groups, nongovernmental organizations, and other academic institutions.   He has authored or co-authored over 100 publications in books, edited volumes, and professional journals across a range od disciplines.  From 2017-21 he was a regular contributor to Forbes. Prior to coming to the Nicholas Institute in 2006, Dr. Murray was Director of the Center for Regulatory Economics and Policy Research at RTI International, a university-affiliated not-for-profit research institution. 


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