Pennsylvania’s climate rule met with applause and court threats upon finalization

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STATEIMPACT PENNSYLVANIA – The rule to let Pennsylvania join a cap-and-trade program that aims to cut power plant pollution met with praise and condemnation as it crossed the finish line.

Lawmakers opposed to joining the Regional Greenhouse Gas Initiative promised to fight on in court, while environmental groups hailed the move.

Joining RGGI is the centerpiece of Gov. Tom Wolf’s plan to address climate change. The regulation to allow it is set to publish in the Pennsylvania Bulletin tomorrow after two years of debates, public hearings, and challenges in the state legislature.

“At a time when we should be incentivizing the use, development, and deployment of our home-grown energy resources, this final step to enter Pennsylvania into RGGI is a signal to our neighboring states and the rest of the world that the Wolf administration is not serious about American energy independence and the economic benefits associated with a robust and growing energy economy,” said House GOP spokesman Jason Gottesman.


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“Although we are disappointed in this temporary setback, we will continue to press our argument to the Court that the Administration cannot legally take further steps to join RGGI,” they said.

Legal challenges are on the horizon for the rule.

Senate leaders, President Pro Tempore Jake Corman (R-Centre), Majority Leader Kim Ward (R-Westmoreland), Appropriations Committee Chair Pat Browne (R-Lehigh), and Environmental Resources and Energy Committee Chair Gene Yaw (R-Lycoming), released a joint statement saying they stand by previous arguments that the move to join RGGI requires legislative approval.

Commonwealth Court is set to hear arguments on May 2 primarily on the appropriate timeline for the rule’s publication. The Wolf Administration claims lawmakers had less time than they took to respond to the regulation.

Court documents show parties are filing lists of witnesses and exhibits in the case.

More legal challenges from affected groups, such as coal-fired power plants, are expected.

Meanwhile, environmental groups are calling the move momentous.

“Climate experts, health professionals and Pennsylvanians have been saying for years that we need to be taking proactive steps to reduce global warming pollution. Over the past two years, it’s become clear that RGGI is one of those critical steps,” said PennEnvironment’s Executive Director David Masur.

But some added that there is more to do to make sure the money raised through RGGI is put to the best use. The Wolf Administration has estimated it could raise about $200 million each year.

“Next, the Wolf Administration must develop a strong RGGI investment plan that prioritizes the communities that are transitioning away from fossil fuels and environmental justice communities who bear much of the burden of climate change,” said Mark Szybist, Senior Attorney for the Climate & Clean Energy Program at Natural Resources Defense Council.

Once the rule is published, the Department of Environmental Protection can start to determine the number of allowances for carbon pollution required for each qualifying power plant.

Under RGGI, power plants must buy an allowance for each ton of carbon dioxide they emit, making dirtier sources more expensive and less competitive when selling electricity to the grid. In the most recent allowance auction, the price was $13.50 per ton.

If dirtier sources are less competitive, they could end up providing less power to the grid, while cleaner sources such as nuclear and renewables ramp up. That ultimately drives down emissions.

The regulation says power plants must start accounting for their CO2 emissions starting on July 1, 2022. Plants have until March 1, 2024 to account for 100 percent of their 2022 emissions. Power plants will be required to have 50 percent of their 2022 required allowances by March 1, 2023, and 100 percent of required allowances by March 1, 2024.

RGGI says CO2 emissions from power plants in participating states have fallen by 45 percent from a base level measured from 2006-2008. The cap has been adjusted to put more pressure on emitters. The latest change requires a 30 percent reduction from 2020 levels by the year 2030.

States can use the money raised at auction to invest in clean energy, energy efficiency, and other measures to benefit people in the state.

Because Pennsylvania is joining RGGI through regulation, and not a law passed by the legislature, the money will go to the Clean Air Fund, where it can only be used to reduce air pollution.

The legislature could reallocate the money. The Wolf Administration and Democratic lawmakers have proposed a spending plan that would aid communities where coal plants close and areas that experience a higher pollution burden. The legislation has gotten no traction so far.

RGGI states include Connecticut, Delaware, Maine, Maryland, Massachusetts, New Hampshire, New Jersey, New York, Rhode Island, Vermont, and Virginia.

If the rule survives legal challenges, it still faces a murky future. A future governor could reverse Wolf’s order that directed the state to join.

The Democratic Party’s presumed nominee, Attorney General Josh Shapiro, has expressed doubts about the program.

Many Republicans running for governor have said they would pull the state out of RGGI if elected this fall.