Romney is said to plan limits on polluter funds

Governor Mitt Romney will propose as soon as this week limits on how much the state's dirtiest power plants would pay to emit a key pollutant linked to global warming, according to a government official who has seen the document detailing the plan.

The approach of capping pollution payments is similar to one that Romney has proposed in a broader regional pact that would limit emissions of the same kind of greenhouse gas from power plants. Romney's request may end up excluding Massachusetts from a nine-state agreement; the other states disagree with Romney's proposal.

In 2001, the state was the first in the nation to announce limits on carbon dioxide releases into the atmosphere from power plants. Those restrictions, which take effect next month, target the state's six oldest and most polluting power plants.

But under Romney's proposal, power companies could pay into a fund, rather than lower their emissions once their allowed limit is reached. As early as January, power plants could pay $10 into the fund for every excess ton of carbon dioxide they emit, according to the government official, who declined to be identified because of the sensitivity of the discussions. It was unclear last night what the fund would be used for.

The plants would benefit by not having to make reductions in emissions if they opt to just pay the fee. Romney has expressed concern in recent weeks that the cost to power plants that comply with such programs could harm businesses, because the costs would be passed on to them.

Romney's office declined to comment last night. No legislative approval is needed for the governor's proposed change, though it would require a public comment period prior to its institution.

Environmentalists sharply criticized the reported move. ''Under [a program like this] you can keep polluting as long as you pay $10 a ton," said Seth Kaplan, a senior attorney for the Conservation Law Foundation. ''The governor is not only selling out the citizens of the Commonwealth, he is selling them out cheap."

Two months ago, the state's 2001 plan was seen as a transition program, before the Regional Greenhouse Gas Initiative, which would affect about 720 power plants in nine states, absorbed it.

But as Romney wavers on that pact, the state plan has gained in prominence because it may wind up being the only carbon dioxide regulations Massachusetts gets.

Last week, other states involved in the agreement decided to move forward without Massachusetts, although they left the door open for more negotiating before an announcement of the pact within the next two weeks. Rhode Island is also wavering on the pact, which was to include all the New England states as well as New York, New Jersey, and Delaware. Massachusetts has said it is still considering the pact.

The Massachusetts program does not operate exactly like the regional agreement. Under the regional agreement, the market would decide how much it would cost a power plant to emit a ton of carbon dioxide if the plant exceeds limits. Power plants that pollute less could sell credits to those that pollute more. The system is designed to encourage investment in cleaner technology. It is these credits that Romney wants to place a price cap on.

Under the program, the state gives each plant permission to pollute a certain amount. The way it was designed -- without a price cap -- plants would face enforcement if they exceed their limit or do not find ways to comply.

Some businesses are concerned that the lack of a price control mechanism on emissions could prompt a spike in energy prices, which would harm businesses.

''We need as many controls as possible to ensure electricity prices don't rise," said Kevin Conroy, chief of staff for the New England Council, a business trade group. ''Our ratepayers are already paying higher prices."

Greenhouse gases are released from power plants and vehicles, trapping heat in the atmosphere and radiating it back to earth. Many scientists say the earth is heating up more rapidly because of man-made releases of the gas.

A group of industrialized countries have signed the Kyoto Protocol, which will reduce emissions, but US officials have refused to do so, saying they want developing countries to be part of the pact. President Bush has refused to enact limits on the gas, saying it is unclear how much people are contributing to the problem.

The nine-state agreement was largely seen as the first major effort by a group of states to bypass Bush's reluctance to enact limits.

Beth Daley can be reached at bdaley@globe.com.