REGULATION

Research group says joining RGGI would give Va. a low-cost way to comply with EPA's power plant rule

A new study from a clean energy advocate is urging Virginia to join the Regional Greenhouse Gas Initiative. That's despite the fact that a bill doing just that stalled in the Commonwealth's Republican-controlled Legislature earlier this year, and never saw a vote.

The Boston-based Acadia Center, which promotes renewable and low-carbon energy, argues joining the nine-state regional cap-and-trade program would be a low-cost, low-hassle way for Virginia to comply with U.S. EPA's impending Clean Power Plan. "The current RGGI states have already done the time-consuming work of setting the cap, creating allowance auction and tracking platforms, and establishing enforcement protocols," the paper states.

EPA is promoting regional compliance plans as a cheaper, easier way for states to comply with its mandate to reduce the power sector's carbon footprint 30 percent below 2005 levels over the next 15 years. It gives states that sign onto regional compliance plans an extra year to submit proposals. A growing number of environmental and industry analysts are also pushing regional approaches as their preferred path forward, as well.

In this environment, RGGI's members have been eager to promote their regional program as a model for the rest of the country. Public service commissioners and environmental regulators from New York, Maryland, Massachusetts, Connecticut, Delaware, Maine, New Hampshire, Rhode Island and Vermont have pointed to substantial reductions in RGGI states' greenhouse gas emissions, alongside continued economic growth.

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There's also the money. Last month, RGGI auctions brought in $82 million, bringing cumulative revenue to more than $2 billion. States have used this money to bolster renewable energy and efficiency programs, and provide rebates to consumers, among other uses.

The Acadia study estimates Virginia could bring in $2.8 billion of cumulative revenue by 2030. "The experience of the current RGGI states has proven it doesn't cause harm to ratepayers," said author Jordan Stutt. "It's actually produced significant net benefits to the economy of the region. And based on the current trend in Virginia's generation mix, which is quickly become less carbon intensive, becoming a participant in RGGI would be rather easy."

Can a Republican Legislature learn to love cap and trade?

Easy, except for the political realities standing in the way of membership. While Democratic Gov. Terry McAuliffe has long been an advocate of renewable energy, Republicans control both chambers in the General Assembly and enjoy a wide majority in the House of Delegates.

Geoffrey Skelley, the associate editor of Sabato's Crystal Ball at the University of Virginia's Center for Politics, pointed out that even with a Republican sponsor, state Del. Ron Villanueva, a RGGI membership bill died in committee this year (ClimateWire, Dec. 23, 2014). "I guess that shows where it's at," he said, noting many Republican politicians associate cap-and-trade efforts with President Obama, who unsuccessfully pushed for a national cap-and-trade measure during his first two years in office.

Even if McAuliffe were to channel Washington Gov. Jay Inslee (D) and try to steer auction revenue to non-environmental efforts like tax rebates, Skelley is skeptical the Legislature would go for it (ClimateWire, Dec. 12, 2014). "I would tend to think that even if you tried to argue for this from that perspective, it would still be difficult for it to fly. The Legislature might be more in a deregulating mode, on energy in particular."

That's not to say RGGI hasn't enjoyed Republican support in some quarters. New Jersey Gov. Chris Christie (R) pulled the Garden State out of the program in 2011, blasting it as "gimmicky." But Gov. Paul LePage (R) has kept Maine in RGGI, and newly elected Republicans in Massachusetts and Maryland have given no indication they'll follow Christie's lead.

Still, the political dynamics may change over the next few years, when Virginia and other states are forced to figure out how to implement EPA's carbon regulations. Right now, the Clean Power Plan may be hazy, complicated and far in the future for many legislators.

But if they don't have a choice about whether or not to reduce Virginia's carbon emissions, Stutt said RGGI may be eyed as the best-case approach. "It's administratively simple," he said. "All of the legwork has been done by the current RGGI states. At this point, it's a matter of adopting the existing model rule."

@scottdetrow | Email: sdetrow@eenews.net

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