Critical comment period opens in review of Wolf Administration’s plan to join RGGI

Those most harmed by the Wolf Administration’s “March to the Sea” regulatory campaign to destroy jobs in Pennsylvania’s energy industry have a two-month window to fight back. A public comment period, November 7 to January 14, 2021, has opened before the Independent Regulatory Review Commission (IRRC).

“Pennsylvania’s power generation sector is in full compliance with the strictest EPA and DEP standards, yet Governor Wolf wants to move the goalposts again,” said PMA President & CEO David N. Taylor. “The comment period at IRRC is critical for employers, employees, and consumers to resist Governor Wolf’s unilateral move to tear down Pennsylvania’s energy economy by imposing a carbon tax.

The tax is the price of admission to a cartel of 11 Northeastern and Mid-Atlantic states known as the Regional Greenhouse Gas Initiative, or RGGI, a government contrived cap-and-trade plan to attempt to reduce carbon dioxide emissions. Joining RGGI will cost the generating industry in Pennsylvania an estimated $2.4 billion over ten years, wiping out thousands of high-paying energy jobs.

The tax will mainly impact coal fired plants, but some older natural gas fired plants will be hit as well, forcing many to shut their doors. Thousands of jobs in generation, mining, and downstream industries will disappear with them.

A state rich in affordable natural gas and coal would lose its crown as one of the leading exporters of electricity in the nation. All this for environmental benefits that remain largely a fantasy of anti-fossil fuel activists. In fact, many industry experts believe there will be no environmental benefit at all as the electricity generation will transfer to non-RGGI states that are a part of the PJM system.

“The economic repercussions will be felt throughout Pennsylvania as we see thousands of jobs and millions of dollars in local and state tax revenue lost,” said state Rep. Jim Struzzi (R-Indiana) in a statement released after the House Environmental Resources and Energy Committee this week passed a resolution, HR 1088, expressing disapproval of the plan. “A carbon tax such as RGGI can only be initiated by the General Assembly. This initiative is a major energy and fiscal policy decision, which must be made by the legislative branch of government with input from the people.”

Thus far, the Governor has taken a go-it-alone approach to this regulatory overreach. The business community and labor unions oppose it, as do three advisory committees within the administration’s own Department of Environmental Protection (DEP), the implementing agency for the proposed regulations. In the General Assembly, both Republican and Democratic lawmakers voted to approve legislation in September that would give them final authority over the proposed plan, or similar multi-state accords that include a tax or fee component. The General Assembly’s opposition is warranted considering not just the impact on jobs, but the fact, as Struzzi noted, that the General Assembly and the General Assembly alone has the constitutional authority to impose new taxes. The governor vetoed the bill.

Rachel Gleason, Executive Director of the Pennsylvania Coal Alliance, is urging as many comments against the proposal as possible. (Learn more: https://powerpajobs.com/engage/rggi-tax-regulation

“The more the better if this fight ends up in court,” she said.

And it very well could. After the comment period and public hearings end (ten virtual hearings are planned between December 8 and 14), IRRC will have thirty days to return its comments on the proposal to DEP. In considering its comments, IRRC will weigh factors that on the surface appear to be in the industry’s favor: impact on the regulated community; if the administration has the statutory authority to implement the regulations; the impact on small businesses.

By spring or early summer, DEP is expected to respond to any changes in the proposed regulatory language suggested by IRRC. Within 30 days IRRC will either approve or reject the new language. But an IRRC rejection of the regulations won’t necessarily prevent implementation. DEP has the right to re-submit the language, and even continue to pursue implementation if it’s rejected again. The General Assembly could intervene and approve a concurrent resolution rejecting the plan. But the governor would almost certainly veto this attempt. No matter the series of events, a continued effort by the administration to implement the language will almost certainly end up in court. That’s when the comments submitted over the next two months become especially valuable.

Electricity rates, of course, would increase if Pennsylvania joins RGGI. Families and businesses will pay more, and the state will lose its competitive edge in generation to Ohio and West Virginia, two states that also sell power to the PJM Interconnection grid, but two states that will almost certainly never join RGGI.

The final kicker is that DEP’s own scientists estimate that the increased use of natural gas in electricity generation in Pennsylvania is lowering greenhouse gas emissions by nearly the same levels that the imposition of a carbon tax promises top. In short, the free market is now giving us the same benefits without government interference, the loss of thousands of jobs, and higher, less-competitive electricity rates.

From an earlier Bulletin story, Benjamin Zycher, Energy and Environmental Scholar at the American Enterprise Institute, said that joining RGGI would be “pretty silly.”

“Take their [DEP’s] assumed reductions in greenhouse gas emissions and then run the EPA’s climate model to get a predicted temperature effect in 2100,” Zycher said. “It will be in the ten-thousandths or one-hundred-thousandths of a degree.”

The loss of thousands of jobs seems like a high price to pay for an unproven idea, especially as we begin to emerge from crushing economic shock of the pandemic.

To submit a comment to IRRC, DEP, Governor Wolf, and your elected legislators, please click here: https://powerpajobs.com/engage/rggi-tax-regulation

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