Wolf Vetoes Legislature’s Effort to Block RGGI

Gov. Tom Wolf earlier this month vetoed a resolution approved by the state legislature to block Pennsylvania’s participation in the Regional Greenhouse Gas Initiative (RGGI). The legislature in late 2021 passed the disapproval resolution after the Environmental Quality Board and the Independent Regulatory Review Commission had both given their approval to final rulemaking for the CO2 Budget Trading Program, which would allow Pennsylvania to join RGGI this year. The state House and Senate now have 30 calendar days or 10 legislative days – whichever is longer – to try to override the veto. However, neither chamber passed the resolution with the two-thirds majority required for an override. If an override attempt fails the state can join the RGGI, however Republican legislative leaders have signaled that legal action could be the next step.

The RGGI is designed to reduce greenhouse gas emissions by creating a cap-and-trade program for the state’s power plants. Gov. Tom Wolf signed an executive order in 2019 that directed the state Department of Environmental Protection to begin a rulemaking process that will allow Pennsylvania to participate. In his veto message, Wolf called RGGI “a vital step for Pennsylvania to reduce carbon emissions and achieve our climate goals. Addressing the global climate crisis is one of the most important and critical challenges we face.” RGGI is an initiative of 11 New England and Mid-Atlantic states to cap and reduce their power sector carbon dioxide (CO2) emissions. This is achieved by setting a regional cap, or limit, on CO2 emissions from electric power plants in the participating states. Allowances equal to tons of CO2 that will enter the atmosphere from power plants are auctioned quarterly, and electricity generators must buy the amount needed to cover their emissions, with the proceeds going to the states. Pennsylvania’s participation in RGGI is estimated to bring in about $300 million in the first year. The plan to join RGGI has been met with opposition from the coal industry, energy sector, labor unions, and many Republican legislators as well as lawmakers representing coal mining communities, including those in the Southwestern part of the state. In addition, some critics argue that CO2 allowances power plants must buy amounts to a tax, which can be imposed only by the legislature. Wolf’s veto message points out that the “Republican-controlled General Assembly has failed to take any measures to address climate change.” In addition, he stated, “in addition to the environmental benefits, participating in (RGGI) will allow Pennsylvania to make targeted investments that will support workers and communities affected by energy transition.

Wolf must wait to see if the legislature will override his veto before the state can proceed to join the initiative, but further delays seem likely.