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Pennsylvania Enters the Regional Greenhouse Gas Initiative

04/22/2022

Harrisburg, PA – The Wolf Administration has finalized the regulation to combat climate change and allow Pennsylvania to participate in the Regional Greenhouse Gas Initiative (RGGI), fulfilling a promise made in a 2019 Executive Order to take part in the market-based program.

“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 Department of Environmental Protection (DEP) Secretary Patrick McDonnell. “Climate change caused by pollution remains the most critical environmental threat confronting us and we are already paying the price.”

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.

“This regulation has the support of businesses and residents, and will save lives and millions of dollars by cutting air pollution,” said McDonnell. “This is only one step necessary to fight climate change, and while Pennsylvania cannot singlehandedly solve the global climate crisis, the world cannot solve the crisis without Pennsylvania.”

Some of the benefits of RGGI for Pennsylvania include:
Reducing up to 225 million tons of carbon pollution from Pennsylvania power plants by 2030
Preventing up to 30,000 hospital visits for respiratory illnesses like asthma
An increase in Pennsylvania’s Gross State Product of nearly $2 billion, and a net increase of 30,000 jobs by 2030

Nearly 14,000 people commented on the regulation, including the hundreds that participated in the 10 virtual public hearings DEP held. Throughout the regulatory process, DEP held over 15 public discussions on the regulation with a range of expert advisory committees. The final regulation was supported by both the Citizens Advisory Council and the Air Quality Technical Advisory Committee.
 
“The reaction from Pennsylvanians during the development of this regulation was clear – they want us to take action on climate. Communities and businesses are already experiencing the impacts of climate change, and those impacts will only accelerate between now and 2050. Most Pennsylvanians realize we need to do something about that,” said McDonnell. “Reducing the carbon pollution that drives climate change is critical to preventing some of the worst impacts of climate change.”
 
“RGGI is also important for environmental justice communities,” said McDonnell. “The initiative creates a financial incentive to reduce carbon pollution to which environmental justice communities are often more vulnerable due to social and economic factors. Communities facing environmental justice issues are likely the first communities to feel the effects of climate change through heat waves and flooding, while also likely being communities with the fewest financial resources to adapt.”

RGGI is an initiative of 11 New England and Mid-Atlantic states that began in 2009 to reduce greenhouse gas emissions from the power sector while generating economic growth. Together Connecticut, Delaware, Maine, Maryland, Massachusetts, New Hampshire, New Jersey, New York, Rhode Island, Vermont and Virginia cap and reduce their power sector carbon dioxide (CO2) emissions. This is achieved by setting a regional cap or limit on CO2 emissions from electric power plants in the participating states. That cap decreases year over year to reduce overall carbon emissions. Pennsylvania’s participation will increase the size of the program approximately 40 percent.
 
Qualifying power plants must acquire CO2 allowances equal to the amount of CO2 they emit. And while each state has its own allowance budget, the only firm cap is the regional one. Entities in each of the qualifying states can purchase and trade allowances- allowing for the most efficient and cost-effective emissions reductions. Also, since RGGI is a market-based approach, the quarterly auction sets the price for the purchase of allowances to ensure transparency.
 
DEP will now determine the number of allowances for carbon pollution required for each power plant. Power plants must start accounting for their CO2 emissions starting on July 1, 2022. Facilities have until March 1, 2023, to account for 50 percent of their 2022 emissions and 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.

More information is available at www.dep.pa.gov/rggi

MEDIA CONTACT: Neil Shader, nshader@pa.gov, 717-787-1323
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