Decarbonizing power generation will cut emissions and lower Pennsylvanians’ utility bills. Here’s how.
Pennsylvania stands to realize an estimated $1.5 billion in energy savings by participating in the Regional Greenhouse Gas Initiative (RGGI) carbon market, satisfying Governor Shapiro’s four criteria for power sector decarbonization:
Address climate change
Create energy jobs
Protect consumers
Provide reliable & affordable energy
“We must reject the false choice between protecting jobs and protecting our planet. I believe we can do both – we can embrace the Commonwealth’s role as an energy leader, create good paying jobs, and fulfill our constitutional obligation to protect Pennsylvania’s clean air and pure water.”
Business is ready for RGGI
Companies and institutions that do business in Pennsylvania understand the need to reduce carbon emissions from power generation. That’s why these organizations — collectively employing 60,600 Pennsylvanians — support the plan linking Pennsylvania’s electricity sector with the Regional Greenhouse Gas Initiative (RGGI), a market-based approach that will catalyze innovation and put Pennsylvanians to work building a more resilient and prosperous future.
Hugh Welsh, president & general counsel of DSM North America
"Joining RGGI is an important step toward building a thriving energy future for Pennsylvania. RGGI has shown to be the most efficient and economical way to reduce emissions and will keep Pennsylvania competitive by delivering lower energy prices, improving air quality, and spurring investments to support communities, businesses, jobs, and innovation. We look forward to Governor Shapiro's leadership on this issue and hope to see Pennsylvania move forward with joining RGGI as soon as possible so the Commonwealth can begin taking advantage of hundreds of millions of dollars for reinvestment into the Pennsylvania economy.”
Jeffrey Perkins, executive director of Friends Fiduciary Corporation
"Friends Fiduciary Corporation is guided by the belief that responsible investments are the best and most efficient way to serve our investors over the long term. The Regional Greenhouse Gas Initiative gives Pennsylvania an opportunity to similarly position itself for the future by using a proven market-based solution to reduce climate pollution while driving meaningful investment into a low-carbon economy that will pay dividends across the Commonwealth for decades to come."
Megan Villarreal, policy and public affairs at Nestlé
“Nestlé powers about 75% of the electricity needs at our five Pennsylvania facilities with renewable energy, and we are working toward 100% renewable energy across all of our operations globally. RGGI is an important tool that will allow the Commonwealth to continue growing its economy while reducing pollution and accelerating the shift to clean energy, benefiting communities and companies across Pennsylvania. We thank the Shapiro administration for considering the program, are confident that a close review of this program will show its many benefits to the Pennsylvania economy and look forward to celebrating the Commonwealth's entry into RGGI soon."
What is RGGI?
The Regional Greenhouse Gas Initiative (RGGI) is made up of twelve northeastern states that have paired carbon caps with market mechanisms, enabling electricity producers to meet emission targets in keeping with their own strategic and financial goals. Revenues generated through the RGGI market are reinvested in clean-energy innovation, job creation, ratepayer protection, and support for communities.
In 2022, the Pennsylvania Department of Environmental Protection completed a rulemaking process to make Pennsylvania the newest — and largest energy-producing — member state. The Commonwealth was to have begun participating in the RGGI carbon market in 2023, but the transition is currently on hold pending legal challenges.
RGGI will…
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Reduce energy costs
Pennsylvania’s participation in the RGGI market would save $1.5 billion in energy costs to residents, businesses, and the industrial sector between 2025 and 2030.
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Cut electric bills
Ratepayer assistance programs funded through the sale of carbon allowances would mean an annual savings of $24 for the average Pennsylvania household.
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Stabilize energy prices
From 2021 to 2022, residential electricity rates in Pennsylvania increased by 9 percent due in part to volatile natural gas prices — six times larger than the projected impact of RGGI on residential rates.
Federal Funding at Risk
Increased deployment of solar, wind, and battery storage due to Pennsylvania’s participation in RGGI brings $930 million of additional IRA tax credits to Pennsylvania that would not be realized if Pennsylvania were to withdraw from the program
By implementing RGGI, the Commonwealth will benefit from a total of $2.2 billion in IRA tax credits from the construction of in-state renewable energy
Between 2018-2020, RGGI created:
$669 million in added economic benefits
More than 7,874 new job-years of employment
$292+ million in consumer electricity savings
Source: Acadia Center, 2019
Measuring RGGI’s Success
2008-2021
The record speaks for itself: since 2008, states participating in RGGI have cut their emissions in half and grown their economies — outpacing the rest of the country in both categories. Meanwhile, as utility rates rose across the rest of the country, RGGI states actually cut their electric bills by more than 5 percent.
“RGGI’s success is proof that economic growth and environmental responsibility can and must go hand-in-hand.”
— PA business leaders’ letter to Governor Shapiro and the General Assembly