HARRISBURG — The budget proposed by Gov. Tom Wolf includes a plan for Pennsylvania to join the Regional Greenhouse Gas Initiative (RGGI) — a move that is strongly opposed by State Sen. Gene Yaw.
“Today, Governor Wolf doubled down on his scheme to join the Regional Greenhouse Gas Initiative, which if not prevented by the General Assembly or the courts, will lead to a discriminatory and job killing tax on all coal and gas fired electric generation plants in the Commonwealth,” Yaw said in a press release on Tuesday.
According to the Pennsylvania Department of Environmental Protection, participating states have agreed, either through regulation or legislation, to implement RGGI through a regional cap-and-trade program involving CO2-emitting electric power plants. These states (Connecticut, Delaware, Maine, Maryland, Massachusetts, New Hampshire, New York, Rhode Island and Vermont) set a cap on total CO2 emissions from electric power generators in their states.
“RGGI is composed of individual carbon budget trading programs in each state, based on each state’s independent legal authority. RGGI provides a ‘model rule’ for each state to adopt independently that then ‘links’ with other states to allow for the interstate buying, selling and trading of auction credits. This allows states to essentially regulate independently, while it increases the supply of available credits to level the price,” the DEP website states.
According to the DEP, the Regional Greenhouse Gas Initiative “is an effective way to reduce emissions without impacting economic growth.”
“RGGI states have reduced power sector CO2 pollution by 45 percent since 2005, while the region’s per-capita GDP has continued to grow. Through its first six years of existence, RGGI investments were found to return $2.31 billion in lifetime energy bill savings to more than 161,000 households and 6,000 businesses that participated in programs funded by RGGI proceeds, and to 1.5 million households and over 37,000 businesses that received direct bill assistance,” the DEP said.
Yaw disagreed with the DEP’s assessment of the program.
“In his budget address, the Governor promised to ‘raise hundreds of millions of dollars … to make our air cleaner.’ This statement is terribly misleading and fails to account for the enormous risks to Pennsylvania’s economy and communities in the event of an RGGI carbon tax,” Yaw said.
Yaw believes the RGGI will force several companies to shut down facilities.
“According to several of the largest coal plant owners and their largely union labor forces, the 30 percent per MWh RGGI tax on coal plants will likely trigger the immediate closing of those facilities,” Yaw said. “In addition, older, less efficient gas plants will struggle to compete with newer, more efficient gas plants. Since 2016, Pennsylvania has benefitted from more than $14 billion in capital investments in these new and efficient gas plants. But, where will the next $15 billion in new gas plants be invested? In Pennsylvania? Where those plants will have to pay a 10 percent per MWh tax? Or in neighboring West Virginia or Ohio?”
Yaw, who is the Chairman of the Senate Environmental Resources & Energy Committee, announced Tuesday his intention to hold a series of public hearings in Harrisburg and around the Commonwealth to hear from impacted plant owners and labor forces, host communities and other stakeholders, like local governments and fuel suppliers.
He will also look to solicit input on legislation like Senate Bill 950 and House Bill 2025 that would underscore the General Assembly’s exclusive legislative authority to impose a carbon tax on any type of industrial emissions.
“The Senate Environmental Resources & Energy Committee will host a series of public hearings in Harrisburg and throughout Pennsylvania to force the Wolf Administration to answer the hard questions about the immediate and irreparable harm triggered by the RGGI carbon tax. The first hearing will take place in Harrisburg on March 18, 2020,” Yaw said.
Yaw believes one reason Pennsylvania should avoid joining the RGGI is because the commonwealth is in a much different situation than the other states involved.
“As I stated at the press conference to announce the introduction of Senate Bill 950 and House Bill 2025, Pennsylvania has nothing in common with the other RGGI states,” Yaw said. Pennsylvania is blessed with an abundance of coal and natural gas resources, and as a result, possesses one of the most diverse, reliable and low-cost electric generation resources in the country, if not the world.”
“Indeed, not only do we have little in common with the other RGGI states, we are in great conflict with RGGI states like New York and New Jersey, which have banned new pipelines that would allow our abundant, low cost Marcellus Shale gas to flow to large markets like New York City and Boston whose ratepayers currently have to rely on foreign imports to supply their gas needs,” Yaw added.
The Natural Resources Defense Council had a different view of Wolf’s proposal as the group praised the move.
“Governor Wolf mapped out a strong vision to better the lives of all Pennsylvanians, including a firm commitment to joining the Regional Greenhouse Gas Initiative,” Mark Szybist, a Senior Attorney at the NRDC said. “Not only would this curb harmful climate pollution — it would also help clean up the air our children breathe, enable Pennsylvania to invest in a transportation system that works for everyone, and create family-sustaining jobs and a more equitable society. The governor now has to take this blueprint and make it a reality.”