Wolf Administration approves Regional Greenhouse Gas Initiative 

Ioannis Pashakis//April 22, 2022

Wolf Administration approves Regional Greenhouse Gas Initiative 

Ioannis Pashakis//April 22, 2022

The Regional Greenhouse Gas Initiative, a cap-and-trade program rewarding power companies that reduce carbon dioxide emissions, has been finalized by the Wolf Administration. 

The initiative, commonly known as RGGI, has been a focus of Gov. Tom Wolf’s since 2019 when he directed the Pennsylvania Department of Environmental Protection (DEP) to develop rulemaking that established a carbon dioxide budget consistent with other RGGI participating states. 

RGGI is a partnership between 11 Northeastern and mid-Atlantic states. States participating in the program set a regional cap on CO2 emissions from electric power plants. 

Each state has its CO2 allowance budget, which plants must purchase from in an equal amount to the CO2 they emit. 

By joining RGGI, Pennsylvania will reduce up to 225 million tons of carbon pollution from its plants by 2030, prevent up to 30,000 hospital visits for respiratory illnesses like asthma and increase its Gross State Product by nearly $2 billion and 30,000 jobs by 2030, according to the Wolf Administration. 

“Today we are already experiencing the effects of climate change and those impacts are only going to get worse. Our children and their children are going to look back at our decisions and by participating in RGGI, we have begun to set Pennsylvania on the path forward to addressing this threat,” said DEP Secretary Patrick McDonnell. “Climate change caused by pollution remains the most critical environmental threat confronting us and we are already paying the price.” 

RGGI was approved by the Independent Regulatory Review Commission of Pennsylvania last September and was then sent to the General Assembly for debate. 

Opponents have pointed out that the initiative would harm Pennsylvania businesses and could send the state’s power plants to other states. 

Earlier this month, the Pennsylvania Senate failed to block the program, falling just under the two-thirds margin needed to override an earlier veto Wolf made of a resolution passed by the Senate last year meant to void RGGI. 

The Senate is also expected to soon vote on House Bill 637, after its passage in the House in March. House Bill 637 would force the program to need legislative approval before a carbon tax on employers could be imposed on the state. 

DEP’s CO2 Budget Trading Program regulation, which will enter Pennsylvania into RGGI, will be published in the April 23, 2022 issue of the Pennsylvania Bulletin.  

The program is on track to participate in RGGI’s next quarterly auction, which sets the price for the purchases of allowances. Revenue from the auctions is returned to the states for reinvestment in efficiency and other Greenhouse Gas reduction programs. 

“Pennsylvania’s program is projected to cut up to 227 million tons of carbon pollution by 2030, deliver billions of dollars in public health benefits, and provide hundreds of millions of dollars annually for reinvestment in Pennsylvania’s families and communities,” said Joseph Otis Minott, executive director and chief counsel of the Harrisburg-based Clean Air Council. “These investments can help improve housing quality, increase energy efficiency, and lower electricity bills, as well as further eliminate air pollution.”