The fossil fuel interests behind the Power PA Jobs Alliance are spreading myths and falsehoods about the Regional Greenhouse Gas Initiative (RGGI), relying on long debunked talking points, cherry-picked data and outright deception. Here are the facts about RGGI to counter the fossil fueled myths.
Fact: RGGI is a market-based program to reduce pollution
RGGI is a market-based program that sets a limit (the cap) on greenhouse gas pollution, issues permits to large-scale power generating companies, which they may then buy and/or sell (the trade). The program allows the free market to determine the price of emissions reductions. Over time, the limit declines, reducing harmful pollution affordably while generating revenue that can be invested back into communities.
Revenues from the initial auctions are then used to generate local economic benefits. They are frequently invested in local businesses, in weatherization and other energy efficiency programs, or into jobs programs for working in dying industries.
Fact: Conservatives popularized market-based pollution reduction policies.
Cap-and-trade has historically been a favored policy of conservatives and Republican politicians for the very reason that it is not a tax and that it lets the market work. As Politifact explains, Republicans embraced cap-and-trade in the 1977 Clean Air Act amendments, and Presidents Ronald Reagan, George H.W. Bush, and George W. Bush all proposed and implemented cap-and-trade systems to phase out dangerous pollutants.
One was the Acid Rain Program, established under the 1990 Clean Air Act Amendments signed into law by George H.W. Bush, which relied on a cap-and-trade approach to reduce sulphur dioxide pollution. The Acid Rain Program is widely considered a massive success—reducing sulfur dioxide emissions faster than anticipated and at one-quarter of the expected cost.
Fact: RGGI will create family-sustaining jobs in Pennsylvania
RGGI is projected to create 27,000 new jobs in Pennsylvania by incentivizing investment in clean and renewable energy and investing the revenues from the purchase and trading of pollution permits into programs and resources to ensure a planned, smooth transition from fossil fuels.
The economic benefits that RGGI provides have already been proven over the last decade in other participating states. A 2018 article by the Analysis Group, published in a peer-reviewed journal, found that from 2009-2017, “the RGGI program has yielded a net benefit of $4.7 billion and more than 40,000 job-years (defined as the equivalent to one full-time job for one year) to participating states.”
This job creation is important for Pennsylvania, as the state’s coal industry is already dying and gas powered-plants employ far fewer workers than the coal plants that they are replacing. A full 18 coal-fired power plants have already closed in the state this decade, and as the president of the South-Central Building & Construction Trades Council told the House Environmental Resources and Energy Committee, “without RGGI in place, it is estimated that the remainder of coal fired plants retire in next 5 to 10 years, if not sooner.”
Fact: Pennsylvania sets its own terms under RGGI
RGGI is an interstate agreement, but is not a compact. Pennsylvania will retain full independence to set the carbon emissions cap for the state, to decide whether or not to participate in multi-state auctions for the emissions credits, and all revenue generated by the program in Pennsylvania will stay in our state. Further, Pennsylvania will remain in the driver’s seat to determine where the revenue will be both protected and spent.
Fact: Electricity costs go down in states that join RGGI
Opponents of RGGI claim that linking to the program will cause electric rates to increase for Pennsylvania customers. The evidence from other participating states says the opposite. Using data from the Energy Information Agency, the Acadia Center showed that electricity prices in RGGI states have fallen by 6.4%, while prices rose by an average of 6.2% in other states.
Electricity consumers in RGGI states have saved $773 million already under the program, and that figure is expected to grow to $6.98 billion over the lifetime of these measures. Even consumers who don’t participate in RGGI-funded energy efficiency programs benefit, as overall demand is reduced, thereby lowering the market price of electricity for everyone.
The Kleinman Center for Energy Policy at the University of Pennsylvania ran models that found that electricity prices would be stable or decrease if the state joined RGGI, and that if revenue from carbon allowance auctions is used for efficiency programs, prices could drop even more.