Virginia is considering joining a regional cap-and-trade program to comply with EPA’s contentious emission rules for power plants, making it one of the few coal states to openly weigh joining the program.
The Regional Greenhouse Gas Initiative is comprised primarily of Northeast states that have agreed to cut greenhouse gas emissions, which many scientists say are causing the Earth’s climate to warm.
The EPA rules, also known as the Clean Power Plan, set state-specific emission targets that each state must comply with beginning in 2020.
The Regional Greenhouse Gas Initiative would offer states more flexibility by using a regional program, rather than an individual state plan, to calculate emission reductions within a larger system that makes it more likely to meet the goals set by the EPA.
If Virginia were to join the regional carbon market, it would be the first addition of a non-Northeast state, expanding the initiative’s scope and influence.
It also would align Virginia with a number of states that support the EPA’s emission rules as the centerpiece of President Obama’s climate change agenda.
Virginia has a number of coal-fired power plants and coal mines in the southern part of the state. Nevertheless, it did not sign on to a lawsuit against the EPA filed by more than a dozen other coal-dependent states.
Nearly all the RGGI states — New Hampshire, Connecticut, Vermont, Delaware, Maine, Maryland, Massachusetts and New York — filed briefs in federal court supporting the EPA rules.
Although Virginia’s legislature voted down a measure that endorsed joining the initiative as a state compliance strategy, a senior official with the state’s environmental regulator, says it’s still possible.
Michael Dowd, the director of the Virginia Department of Environmental Quality’s air division, told the Washington Examiner that “everything is still on the table.”
“The state Senate did a couple of things. It defeated a bill that would have required us to join RGGI. It also defeated a bill requiring us to study” joining the partnership, Dowd said. But the votes do not preclude the state from considering and joining the regional partnership.
Furthermore, “the governor has something to say on that, and he hasn’t taken a position,” he said.
Virginia Democratic Gov. Terry McAuliffe is seen by environmentalists as supportive of the EPA rules, also known as the Clean Power Plan.
Environmentalists say McAuliffe is evaluating the EPA rules as an opportunity to expand the state’s clean-energy economy. The governor has managed to pass clean energy legislation to support renewable energy development.
In addition, the state has made decisions to retire the bulk of its older coal-fired power plants. Environmentalists argue Virginia is set up to be a winner under the Clean Power Plan, with a bulk of its proposed emission goal already met.
Nevertheless, Dowd sees the hurdles for joining the Regional Greenhouse Gas Initiative stemming less from politics and more from practical changes to the program that would need to occur to accommodate Virginia.
The program has been billed as “an off-the-shelf solution,” but “it really isn’t,” Dowd said. The market “would have to amend its [reduction] numbers” to account for the inclusion of another state’s emissions, he said. The states also would “have to amend their budgets” and other parts of the program to accommodate other states, he said.
Thus far, “RGGI has been very successful because the [emission] numbers have been relatively high and natural gas has driven deep reductions,” Dowd said. But he is not sure if the program could be modified easily to accommodate Virginia’s needs.
Ultimately, what Virginia decides to do depends on EPA’s final rule, he said. “So, we have to wait and see what the final rule is. We don’t know what our final number is going to be,” he said. So, “everything is still on the table.”
The Regional Greenhouse Gas Initiative places a cap on the amount of emissions a state can produce. The program offers credits that emitters can purchase to comply with the program.
The program will be entering its third compliance period, beginning this year and ending in 2018, with a goal of 10 percent emission reductions.
The emission cap ratchets down over the length of the program, with fewer credits made available from one year to the next. States use the revenue generated from the credits to improve energy efficiency and clean energy investments.
