Green Hypocrisy. The Case of Virginia Rejoining RGGI

When Governor Spanberger was swept into office as the Governor of Virginia this year, addressing energy affordability was a core campaign pledge. Cost of living was an important issue for voters and she promised to deliver with Abigail’s Affordable Virginia Plan which detailed her goals to address the cost of healthcare, housing, and energy.

Spanberger was committed to both reducing consumer’s skyrocketing energy bills and having Virginia rejoin RGGI, the Regional Greenhouse Gas Initiative. RGGI is a carbon cap-and-trade program that taxes CO2 emissions from fossil fuel power plants. Power plants in the program must buy allowances for their emissions, and states use the auction proceeds for things like clean energy, efficiency, flood protection and bill assistance. 

Governor Spanberger’s predecessor, Governor Glenn Youngkin, had withdrawn Virginia from membership in RGGI, calling it a hidden tax on energy consumption. He argued that the cost of carbon allowances was not penalizing big polluters as intended, but was instead being passed directly down to ratepayers and businesses. Because Virginian utility monopolies like Dominion Energy can legally pass cap-and-trade compliance costs straight to consumers, Youngkin argued that power producers lacked any genuine market incentive to actually lower their carbon emissions. 

Membership in RGGI likely does have some impact on reducing in-state carbon emissions by making fossil fuel plants more expensive to operate and less competitive with subsidized renewable wind and solar energy. It certainly encourages the closure of coal fired power plants. When Virginia’s fossil fuel powered plants operate less frequently or shut down entirely, overall CO2 emissions are not always reduced, some are simply are moved across state lines to places like West Virginia which is heavily dependent on coal power. Virginia relies on neighboring states to generate as much as 36% of its electricity consumption. Imported power has additional costs from transmission and congestion prices. This has helped contribute to a 37% increase in the cost of Virginia electricity in the past five years.