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By Charlotte Rene Woods | @charlottewords
Legal experts argue that Gov. Glenn Youngkin’s executive order alone cannot pull Virginia out of the Regional Greenhouse Gas Initiative (RGGI), but here’s what the order means and other ways that could happen.
RGGI requires carbon-emitting power plants to purchase allowances for their emissions in quarterly auctions. Since that law took effect, Virginia earned almost $228 million in funding. The money has been used for programs to bolster energy efficiency for low-income families and combat rising sea levels in coastal areas.
The executive order, signed on Jan. 15 after Youngkin’s inauguration, outlines that the state’s Director of Environmental Quality and the Secretary of Natural and Historic Resources provide a report that evaluates costs and benefits of participation in RGGI within 30 days. In the meantime, Youngkin plans to inform RGGI of intent to withdraw from the 11 state carbon market.
However, it’s the General Assembly that must undo it’s previous work should Virginia be pulled out of RGGI– according to the Southern Environmental Law Center.
Simply put, “to undo a law, you need a new law,” said Nate Benforado, a lawyer with SELC.
Youngkin did not respond to the question if he hopes the state legislature will send a law to undo participation in RGGI to his desk.
However, other aspects of the order state that Youngkin plans to create an emergency regulation. This would allow the State Air Pollution Control Board to consider repealing information requirements for CO2 budget application permits. Additionally, his administration will “take all necessary steps so that any proposed regulation to the State Air Pollution Control Board can be immediately presented for consideration for approval for public comment.”
Still, Benforado explained regulatory changes won’t get Virginia out of RGGI. Former Attorney General Mark Herring also issued an opinion stating that Youngkin can’t simply pull Virginia out either.
“Since Virginia’s participation in RGGI is required by law, it cannot be undone through regulation alone – whether emergency or otherwise,” Benforado said.
Meanwhile, University of Virginia professor Cale Jaffe explained that should the pollution control board repeal the code, it would create an “administrative migraine” because the board is “the mechanism of how we manage our carbon trading program.”
What’s more, Jaffe notes that between the Virginia Clean Economy Act and the Community Flood Preparedness Act (which included joining RGGI), utility companies are required to transition to carbon-free practices by 2050.
“Repealing the regulation does not repeal the statute,” he said.
In the meantime, the current makeup of the board consists of people appointed by former Democratic governor Ralph Northam. However, terms are staggered and two are set to expire this summer. Jaffe said it’s possible Youngkin may appoint two new people into those roles.
“By having staggered terms, you protect against regulatory whiplash,” Jaffe explained. “A new administration comes in and implements policy choices, but the air board changes more slowly.”
While Virginia has some independent power producers in the state, it’s the larger monopolies like Dominion Energy and Appalachian Power Company that purchased the most allowances in RGGI and have passed those costs onto their ratepayers.
Dominion’s rising costs to its customers caught Youngkin’s eye– spurring his goal to remove Virginia from RGGI.
According to the order, a recent State Corporation Commission filing from Dominion estimates that participation in RGGI could cost ratepayers between $1 and $1.2 billion over the next four years.
For Benforado, he said if companies like Dominion aren’t pleased with the price tag in the carbon market, it should incentivize them to stop burning as much fossil fuel.
Though Dominion has invested in clean energy projects like off-shore wind and solar– as of 2020, it still has at least 6 coal plants around the state.
“The way to fix this is not to repeal RGGI,” Benforado said. “To the extent that Dominion is overcharging its customers for compliance, then we need to make sure that Dominion is taking active steps to reduce their emissions as quickly as possible.”
In the near future, however, the Department of Environmental Quality will need to work on the report that analyzes the costs and benefits of RGGI participation and deliver it to Youngkin within 30 days.
According to Mike Dowd – the Director of the Air and Renewable Energy division in DEQ – the department is still adjusting to the new directives from the new governor.
“We’re still getting our arms around the executive order,” Dowd said. “We’ll be working closely with the governor and the Attorney General’s office as we go forward.”
Though he said he could not comment on the legality of Youngkin’s order as it is out of the Department’s purview, he said that they will “look at the regulatory pathways to implement the executive order.”
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