
The states currently in the Regional Greenhouse Gas Initiative tax compact. Pennsylvania will remain conspicuously absent, and Virginia departs in two months.
by Steve Haner
A state court in Pennsylvania has ruled that the regulatory decision to enroll that state in the Regional Greenhouse Gas Initiative (RGGI) exceeded the authority of state regulators. It ruled RGGI is a tax that could only be lawfully imposed by the legislature.
It was the Republican majority in one of the state’s legislative chambers that brought the legal challenge, so unless or until the political balance changes in that state, a vote to join the interstate carbon dioxide capping program is unlikely.
Adding Pennsylvania would have been a major expansion of the 11-state RGGI compact. Its many fossil fuel power plants would need to buy $400 million or more worth of CO2 allowance credits per year, a third or more than Virginia’s power plants are being taxed.
It is also one of the larger states in the PJM Interconnect regional power marketplace (it is the P) where the power plants do not pay into RGGI, lowering the relative cost of its power when it flows into other PJM states. Virginia electric customers are often using electrons from elsewhere in PJM.
That the money the utilities must pay for operating their fossil fuel plants is a tax is something most RGGI proponents, including those in Virginia, vehemently deny. That was one of the key disputes in the challenge in Pennsylvania, where joining RGGI was a regulatory step initiated by its then-Governor Tom Wolf (D). Continue reading