Analyzing the Long-run Impact of the Regional Greenhouse Gas Initiative on the Maryland Power Sector: Oligopoly Analysis

The regional greenhouse gas initiative (RGGI) is a joint effort by a number of northeast states to control for regional CO₂ emissions. The objective is to reduce CO₂ emissions from the power sector 10% below the current level by 2019 using a cap-and-trade program. The State of Maryland has sponsored an analysis to determine the impacts on Maryland of participating in RGGI. In particular, this analysis sought to evaluate the competitiveness of the state power sector and as well as the any increases in electricity costs for consumers in Maryland. This presentation will summarize the methods and the preliminary results of this study, focusing on results of the simulations that represent strategic behavior by generators.