By Jason McLure
LITTLETON, NEW HAMPSHIRE (Reuters) - New Hampshire Governor John Lynch on Wednesday vetoed a bill that would have ended the state's participation in a regional greenhouse gas reduction program, citing concerns about environmental and economic competitiveness.
Lynch, a Democrat, said pulling out of the Regional Greenhouse Gas Initiative (RGGI) would cost the state $16 million in revenue from the distribution of funds raised by regional carbon auctions -- money that could be used to increase energy efficiency and create jobs.
"I am vetoing this legislation because it will cost our citizens jobs, both now and into the future, hinder our economic recovery, and damage our state's long-term economic competitiveness," Lynch said in an e-mailed statement.
The RGGI, which includes 10 New England and Mid-Atlantic states, established limits on carbon dioxide emissions, thought to be a key factor in global warming.
Under the plan, states agreed to cap and then reduce carbon dioxide pollution by 10 percent by 2018.
The scheme, which also provides technical support for states that auction carbon credits to electric power plants, was dealt a blow in May when New Jersey's Republican Governor Chris Christie announced his state would withdraw from the group by the end of the year.
New Hampshire's legislature is unlikely to override the veto as the state senate failed to garner the support of two-thirds of lawmakers on its initial passage.
Republicans who control New Hampshire's legislature said pulling out of the program would lower costs for utilities and lead to lower electric rates.
"It's something that takes a little bit of money from a lot of people and gives it to a small politically connected group," said James Forsythe, a Republican state senator. "Even advocates of global warming say it has a small impact."
Begun in 2009, the mandatory emissions trading program has raised $886 million from the sale of carbon permits, about 80 percent of which has been invested in greenhouse gas reduction programs or returned to ratepayers.
(Reporting by Jason McLure; Editing by Ros Krasny and Jerry Norton)