Virginians Will Pay the Costs of Gov Youngkin’s Misguided Efforts to Exit the Regional Greenhouse Gas Initiative

(Richmond, VA – July 31, 2023) Today, Governor Glenn Youngkin proceeded with his efforts through executive order to remove Virginia from the 12-state program to cap carbon pollution known as the Regional Greenhouse Gas Initiative, or RGGI, by approving the Virginia Air Pollution Control Board recommendation to repeal the law.

The political maneuvering comes despite overwhelming public favor of nearly 90% to remain in RGGI during the public comment period. Virginia’s participation in RGGI was passed by the state legislature in 2020 and signed into law by the previous administration.

“Amid what scientists predict to be the hottest month ever recorded, Governor Youngkin pressed ahead with his backwards and harmful effort to end Virginia’s successful climate program,” said Mandy Warner, Virginia Director for Environmental Defense Fund. “In just two years of participation, RGGI has already generated over half a billion dollars in investments for energy efficiency upgrades and flood risk reduction projects in our communities while reducing heat-trapping pollution that drives climate change. Without the program, funding will dry up, and Virginia’s taxpayers will have to shoulder the burden of these costs as climate impacts get worse.

“Power companies’ pollution has real, significant costs and it is unfair for polluters to continue to be allowed to shift the costs to Virginians. Youngkin’s climate rollback will undermine Virginia’s progress towards zero carbon emissions in the electricity grid, jeopardize clean energy investments and job creation while supporting power companies’ imprudent, continued investment in polluting fossil fuel technology.

“As RGGI reduces the reliance on fossil fuels, it can also reduce consumers’ risk from swings in volatile fuel prices that have generated sudden spikes in utility bills for consumers. Virginia was on track to lead the clean energy economy. Why is Governor Youngkin moving us backwards?”

Background on RGGI in Virginia:

• RGGI puts a declining limit – or cap – on carbon pollution from power plants across participating states. These plants must pay for their pollution by purchasing allowances. As the pollution limit lowers and allowances become scarce, the program pushes companies to invest in clean energy and pollute less. The proceeds that come to Virginia from selling allowances are already being used to bolster community flood resilience and improve energy efficiency in low-income homes.

• Governor Youngkin blames high electricity costs as a primary reason to exit RGGI. However, both Dominion and Appalachian Power cited spikes in the cost of natural gas, which supplies more than half of Virginia’s electricity, for price increases in 2022. Like other programs that have reduced deadly pollutants from the power sector, RGGI puts a limit on the amount of pollution spewing from smokestacks and requires companies to pay for pollution they choose to continue to emit.

• RGGI allows flexibility for companies to choose their own compliance path which can allow for deeper pollution cuts and the lowest cost. Companies can switch to clean energy, invest in efficiency, utilize polluting plants less, and undertake other measures to reduce the amount of pollution and subsequent fees they pay. Additionally, the RGGI market decides the value of a ton of pollution and companies that innovate to reduce pollution faster are more competitive. These are some of the many ways the cap and invest approach of RGGI is distinct from a tax.  

• Since its launch, RGGI states have seen energy prices fall by 3.2% while they rose by 7.7% in the rest of the country.