Stronger federal leadership and changes to wholesale electricity market rules are needed to supplement New England’s decarbonization efforts, Massachusetts Secretary of Energy and Environmental Affairs Kathleen Theoharides and Katie Dykes, commissioner of Connecticut’s Department of Energy and Environmental Protection, told Raab Associates’ New England Electricity Restructuring Roundtable.

Theoharides and Dykes were the keynote speakers at the virtual event Friday, which drew an audience of more than 450 people.

There has been “no hint of politics in the way we approach this work,” Theoharides said about Massachusetts, whose Republican Gov. Charlie Baker committed the state to a target of net-zero emissions by 2050.

Theoharides said one approach to meeting that goal is the Transportation and Climate Initiative (TCI), a collaboration of 12 Northeast and Mid-Atlantic states and D.C.

TCI would set a limit on carbon dioxide emissions from diesel and gasoline vehicles and allow states to invest proceeds from the sale of carbon allowances to support the goals of the program, such as electric vehicle chargers and electric buses.

The initiative estimates a cap that cut emissions 25% from 2022 levels by 2032 would produce $10 billion in public health benefits (2017$) while covering almost three times the Regional Greenhouse Gas Initiative cap, which includes the New England states, New York and more recently New Jersey and Virginia. Transportation represents 43% of emissions in the TCI region, and total transportation-related carbon emissions are nearly twice as large California’s, Theoharides said.

TCI expects to finalize a memorandum of understanding setting its targets this fall, when each jurisdiction will decide whether to sign the MOU and participate.

“It is a capital investment program,” Theoharides said. “It is a point of regulation far upstream from the consumer at the wholesale or fuel-supplier level. Credits would be auctioned off in each state, and the proceeds would go back into the states, much as they do in RGGI, to invest in clean transportation solutions that give people the option to choose transportation that reduces air pollution and that provides mobility for more residents.”

Amid the COVID-19 pandemic, TCI has the potential to reduce the public health impact of environmental pollution significantly, Theoharides added.

“The pandemic has highlighted the connections between air pollution and respiratory diseases, and TCI is a way to ensure sustained investment in transportation that gives people better, more affordable choices for getting to work, school and health care services while cutting the pollution that makes people sick and makes them more vulnerable to disease,” Theoharides said.

Connecticut has pledged to cut carbon emissions by 80% from 2001 levels by 2050 and 100% in the electricity sector by 2040. Dykes said it is “long past the moment for significant changes in the wholesale electricity markets to ensure that Connecticut can either secure the resources that we need to meet our clean energy goals in-market, or that we can get credit for what we have had to procure outside of the market in order to meet our goals.”

Dykes said a “unified approach” is needed to meet the decarbonization mandates.

“We are not even in an acceptable place in terms of having a proactive transmission planning process that ensures adequate competition in our RTO,” Dykes said about ISO-NE. “For the transmission investments, when you look at the dollars spent per mile deployed, New England is at the bottom of the heap in terms of providing … value for our ratepayers. Transmission service costs are more than twice the average of other RTOs and ISOs.”

Dykes thinks that improving the transparency and accountability of ISO-NE and institutions like the New England Power Pool that are “core to the design and implementation of our wholesale markets” is a “necessary and essential step” to achieve affordable decarbonization that uses competition and minimizes risk to ratepayers. She said the current structure reflects that states do not have adequate input and accountability in the design and structure of the RTO’s governance.

Moderator Jonathan Raab said both Massachusetts and Connecticut have plans and policies in place to meet “really bold decarbonization mandates.” He then asked Theoharides and Dykes if New England states can be “fully decarbonized without strong complementary federal action on numerous fronts” and what the federal government could or should do to facilitate the region’s decarbonization efforts.

Dykes said the impact of climate change on the economy and public health is “accelerating faster than we had anticipated.” She said there is a severe disconnect between states and the federal government, which, Dykes said, is “walking away or even making our climate progress more difficult.”

“We have companies in a private market that can accelerate and deploy climate solutions so quickly and cost-effectively,” Dykes said. “I think the tragedy of all this disconnect at the federal level is that it’s preventing the incredible strengths and advantages of our country from being applied at the scale that we need to solve this climate crisis.”

Theoharides added: “It matters that we have a target as a nation we’re shooting for; it’s not just a handful of states which have mandatory emissions targets; we need a federal target, and we need every state to be pulling its weight to get us there. That leadership needs to come from the top.”

Decarbonization Takes the Whole Village

The conference’s second session featured a four-person panel with representation from local and state governments plus a global nonprofit and think tank. The presentations touched on some of the same topics that Theoharides and Dykes broached earlier and delved into job creation and the social justice aspects of decarbonization.

Hal Harvey, CEO of Energy Innovation, said it is not true “that one has to sacrifice economic vitality in order to have a clean environment.” The financial upside of clean energy is good jobs, lower costs and less local pollution, he said. There were 3.3 million clean energy jobs in the U.S. at the start of 2020, representing more than 40% of the energy workforce, Harvey said.

“The fastest two growing careers in America are solar installer and wind installer,” Harvey said. “The opportunities do not require college degrees. … Roughly half of Americans do not have a college degree; we need an energy strategy that gives them great jobs.”

Hannah Pingree, director of policy innovation and future for Maine Gov. Janet Mills, said the first-term Democrat had made climate progress one of her top agenda items, especially in job creation.

“Maine is embarking right now on an offshore wind project, trying to launch the first floating turbine in the next couple of years, so obviously that’s one of the many exciting things we think could bring jobs and economic prosperity,” Pingree said.

While climate change can drive job creation, Chris Cook, chief of environment, energy and open space for the city of Boston, said it also affects socially vulnerable populations. One of the city’s major initiatives this year is creating Community Choice Electricity, which was recently approved by the Massachusetts Department of Public Utilities. The program will allow the city to buy electricity for residents and businesses through its combined buying power to provide affordable and renewable electricity to those who participate in the program.

“If we provide a clean economy [and] a decarbonization pathway that doesn’t expand equity opportunities for our most socially vulnerable residents, then we will have failed,” Cook said. “It’s not about what we do. It’s about who we do it for. They are our neighbors; they are our friends. They are the people that we are charged with at the city level to take care of, and they need to be actively part of the solution.”

Eugenia Gibbons, Boston director of climate policy for Health Care Without Harm, a global nonprofit that works to reduce the health care sector’s environmental footprint, said climate solutions like decarbonization must benefit historically marginalized communities.

“Essentially we are coming from a place of understanding that climate justice will only be achieved if policies that are enacted bring about concrete improvements in the health and lives of communities that continue to bear the burden of environmental and climate pollution,” Gibbons said. “Equity absolutely has to be a factor in designing, implementing and evaluating policy and program solutions. Otherwise, the disparity will just be perpetuated and exacerbated.”

In the absence of federal leadership, “we absolutely have to demonstrate at the state and local level what is possible and what we are capable of achieving [and] ensure that we are not leaving anybody behind when we move forward with this pathway to decarbonization,” Gibbons added.

When Raab asked the panel for closing thoughts, Harvey said 2020 is an inflection point.

“If we use this decade well, we can land at a reasonable climate future, but this is the decade that matters. This is where we have to stop all new fossil installations, period, and much more rapidly change the direction that we are on,” he said. “I can say now it’s cheaper to save the Earth than to ruin it, because it is. We better get busy, because if we don’t do it this decade, it isn’t going to happen.”