Emerging Trend: A Constitutional Crisis

After a contentious meeting, the Environmental Quality Board (EQB) voted 13-6 this week to toss aside the objections of business, organized labor, and consumer groups, and move forward with Governor Tom Wolf’s plan for Pennsylvania to join a cartel of ten Northeastern states that taxes carbon emissions.

Following the EQB vote, PMA’s President & CEO, David N. Taylor, issued the following statement:

"At every decision point, Governor Wolf has failed to earn public or legislative support for Pennsylvania’s entry into the Regional Greenhouse Gas Initiative, which would hike costs on Pennsylvania energy consumers and kill jobs by imposing a carbon tax. The Air Quality Technical Advisory Committee, the Citizens Advisory Council, and the General Assembly have all voted in bipartisan fashion to reject the Governor’s proposal. That’s why it is most disappointing that the Wolf appointees on the Environmental Quality Board voted to approve the carbon tax plan. As this proposed cap-and-tax scheme continues through the regulatory process, the Pennsylvania Manufacturers’ Association stands united with our labor, consumer, and business allies against Governor Wolf’s proposal."

The EQB vote marks yet another instance when the governor has demonstrated his contempt for both constitutional rights and for private sector jobs. His emergency shutdown order under the pandemic, which included the arbitrary closing of thousands of businesses, was ruled unconstitutional by a federal judge just this week. The governor has promised to appeal the decision. And his carbon tax under RGGI, as all taxes, per the Pennsylvania Constitution, ought to require the approval of the General Assembly. That’s a critically important consideration in this case since the tax will eliminate thousands of jobs both directly in the energy industry, and in downstream industries, in return for wildly overstated environmental and economic benefits.

Many Democratic lawmakers have joined their Republican colleagues to fight for a fundamental constitutional construct; a say in state policy regarding the emergency declaration and RGGI. But they have faced successive gubernatorial vetoes in trying to at least give businesses the right to reopen, and a promised veto on legislation sent to the governor on September 10 that would require legislative review and approval before the commonwealth joins RGGI.

A coalition of business and labor, the Power PA Jobs Alliance, estimates that the bill on fossil fuel electric generation plants from a carbon tax will come in at $2.36 billion over the next 10 years. For homeowners and businesses, this translates to much high electricity rates.

The Alliance notes that Virginia, which recently agreed to joined RGGI, estimates that ratepayers there will be forced to pay up to $6 billion more over the next ten years as a result of RGGI. By comparison, Pennsylvania, with an abundant, affordable supply of coal and natural gas, has rates that are currently below the national average, while rates in RGGI states are on average 50 percent higher than ours.

On the flip side, the Wolf Administration exaggerated both the environmental and economic benefits of a carbon tax.

“It should come as no surprise that the Wolf Administration engaged a pro-RGGI consultant to analyze the costs and benefits associated with Pennsylvania joining RGGI,” the Alliance wrote in a commentary published in August. “The Wolf Administration hired and paid $475,000 to a Virginia company, ICF International Inc., to model the impacts of Pennsylvania joining RGGI. ICF International, which has been lobbying for Pennsylvania to join RGGI for several months, is hardly an independent entity.”

For perspective, consider that the proposed Green New Deal, at a cost of over $2 trillion will according to Ben Zycher, an energy economist at the American Enterprise Institute, earn us a reduction in global temperatures of one-fifth of one degree centigrade.

Closer to home, air quality modeling shows that carbon dioxide emissions in 2030 will be comparable with or without Pennsylvania joining RGGI. Furthermore, naturally occurring market forces have driven carbon emissions down, close to Governor Wolf’s originally intended levels. Governor Wolf’s proposed targeted emissions reductions of 26 percent by the year 2025 is well within striking distance today, some five years away. Energy related CO2 emissions have decreased 22 percent from 2005 to 2016 and with more natural gas fired power plants coming online since 2016, that percentage will increase as the data is updated and republished. Furthermore, a 2017 study by David T. Stevenson of Delaware’s Caesar Rodney Institute concluded that RGGI produced, “no added reductions in CO2 emissions, or associated health benefits, from the RGGI program. RGGI emission reductions are consistent with national trend changes caused by new EPA power plant regulations and lower natural gas prices.”

According to the U.S. Bureau of Labor Statistics, Pennsylvania’s unemployment rate for July was 13.7 percent. Only four states posted higher figures. Instead of creating jobs that pay, as the governor promised during this campaign for office, they are being destroyed via executive order.