Illinois Implements Zero Emission Credits Based on SCC
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Application
Zero Emission Credits Program
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Date
October 2018 -
Details
The state legislature passed a comprehensive energy bill, which included provisions for valuing the social benefits of emissions-free energy. This policy is similar to New York’s zero emission credits program under the Reforming the Energy Vision program.
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SCC Value(s)
$16.50/MWh, based on IWG’s 2016 3% estimate, adjusted for inflation.
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Reference
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Legal Authority
220 ILCS 5/20-135 defines the price for each ZEC as “in an amount that equals the Social Cost of Carbon,” subject to a price adjustment if the price exceeds a threshold.
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Litigation
The U.S. District Court for the Northern District of Illinois upheld Illinois’s ZEC program against preemption and dormant commerce clause claims. The case was then appealed to the Seventh Circuit U.S. Court of Appeals, which upheld the district court decision.
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Commentary
First state after New York to use SCC in setting ZECs.
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