As lawmakers in Harrisburg look for ways to jumpstart the economy, they should start with infrastructure: the roads, bridges, rail lines, airports, power plants, and electric grid that help Pennsylvania businesses compete. And every dollar they spend should go to modernizing that infrastructure, rather than patching it up. Fortunately, there’s a roadmap for modernizing power plants and the energy sector at large — it’s already helped 10 other states along the East Coast reduce air pollution, contain energy prices, and create jobs. It’s called the Regional Greenhouse Gas Initiative (RGGI) and Pennsylvania should join to benefit from its success.
Pennsylvania is an energy powerhouse. The state ranks second in the U.S. in natural gas production, with exports stretching across the region. But many of the plants that produce electricity are outdated, and that means they are dirtier and less efficient than Pennsylvanians deserve. As a result, Pennsylvania ranks 47th in the country on air quality.
Cap and invest programs like RGGI require utilities to buy “allowances” to cover their plants’ carbon emissions, which encourages them to modernize their plants. Older, dirtier plants (which produce more carbon emissions and other harmful pollutants) have to buy more allowances than newer, more efficient plants (which produce fewer emissions). Without this incentive, utilities can keep running old, dirty power plants, passing off added health and climate costs to consumers. RGGI will change that — it is a proven mechanism for pricing carbon into the market and raising proceeds from energy market trends already underway.
The program began in 2008 and currently includes nine states, with New Jersey and Virginia set to join by 2021. In RGGI’s first decade, participating states saw a 47 percent reduction in emissions, nearly twice the rate of non-RGGI states. Over that same period, the GDP of RGGI states grew by 47 percent, and electricity prices remained low. From 2008 to 2017, electricity prices fell by 5.7 percent in RGGI states, but increased by 8.6 percent elsewhere.
Opponents of RGGI argue it will cost Pennsylvania jobs in the coal industry. But those jobs are already being lost because of the market-driven shift from coal to renewables. And the state energy industry has a larger problem: in March, the Commonwealth lost a greater percentage of its clean energy workforce than every state besides Hawaii. An estimated 6,070 jobs were lost in renewable energy, energy efficiency, electric vehicles, and related sectors. RGGI would bring those good jobs back and invest in creating more.
By 2030, RGGI could create 27,000 jobs and $1.9 billion in gross state product, Pennsylvania’s Department of Environmental Protection estimates. These are the jobs that will be the core of Pennsylvania’s energy economy in 10 years. Prices for both solar and battery technologies dropped by 85 percent in the last decade, and wind prices were cut in half. Pennsylvania should take advantage of these trends.
The inevitable shift from fossil fuels to clean energy is already happening, and RGGI raises revenue from the transition. Pennsylvania can reinvest those dollars in building a clean energy economy for the future, which must remain a central goal of the pandemic recovery.
The Pennsylvania Environmental Quality Board (EQB) will be accepting comments until January 14, 2021 on the proposal for Pennsylvania to join RGGI. You can submit comments here. The EQB will also host 10 virtual public hearings from December 8 through December 14. For more on the upcoming hearings, see the EQB webpage.