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Youngkin says he will take Virginia out of the Regional Greenhouse Gas Initiative to save ratepayers money

Virginia Gov.-elect Glenn Youngkin (R) speaks at an economic summit in Richmond earlier this month. (Eva Russo/AP)
correction

A previous version of this article incorrectly calculated the amount ratepayers would save yearly on electric bills if Virginia pulled out of a regional greenhouse gas compact. They would save $52.44 per year, not $227.24 per year. This article has been corrected.

RICHMOND — Gov.-elect Glenn Youngkin (R) told a business group Wednesday that he will use executive action to pull Virginia out of a regional greenhouse gas compact, a plan that Democrats said would cost the state hundreds of millions a year in flooding and energy-assistance funding.

The typical residential customer would save $4.37 a month on electric bills, or $52.44 per year, if Virginia pulled out, Youngkin’s transition office said.

Nearly two years ago, as Democrats took control of the House of Delegates, Virginia joined the Regional Greenhouse Gas Initiative — a carbon cap-and-trade market among states in the Northeast and Mid-Atlantic. It was part of sweeping environmental legislation that also set a goal of going carbon-free by 2050.

Virginia becomes the first Southern state with a goal of carbon-free energy

In a speech to the Hampton Roads Chamber of Commerce, Youngkin said he will take the state out of the RGGI, as the regional initiative is known.

“RGGI describes itself as a regional market for carbon. It is really a carbon tax that is fully passed on to ratepayers,” he said. “It’s a bad deal for Virginians. It’s a bad deal for Virginia businesses. And as governor, I will withdraw us from RGGI by executive action. I promised to lower the cost of living in Virginia, and this is just the beginning.”

Del. Todd Gilbert (R-Shenandoah), who is slated to become House speaker when Republicans take back control of the chamber in January, cheered the news, saying RGGI’s impact on climate change has been “negligible at best.”

“Virginia was reducing carbon emissions from power plants at a rate comparable to RGGI states before joining the cap and trade group,” Gilbert said in a written statement. “When a policy costs the public a significant amount of money for no tangible benefit, that policy should be examined carefully, and if practical, rolled back.”

Some RGGI supporters said they were disappointed and questioned Youngkin’s authority to single-handedly pull the state out.

“I can assure you there’s a lot of lawyers ... that are busy going to the books right now,” said Sen. Lynwood W. Lewis Jr. (D-Accomack), who sponsored the legislation in the Senate.

Regardless of Youngkin’s action on RGGI, the carbon targets will remain in state code — something that cannot be changed without new legislation from the General Assembly, said Cale Jaffe, an associate professor at the University of Virginia School of Law and director of the school’s Environmental Law and Community Engagement Clinic. The Senate remains under narrow Democratic control.

“You might leave this multistate trading program but still have to meet the zero-carbon mandate in the code,” Jaffe said. “Leaving the trading program just seems like cutting off your nose to spite your face. ... I don’t know why you would relinquish a market that is helping to make the Clean Economy Act more affordable.”

Lewis said Virginia raised $227 million early this year in its first auction of carbon credits — money earmarked for flood preparedness across the state and energy-efficiency programs for low-income ratepayers.

“Regardless of your political party, if you’re a legislator in an area that’s impacted by sea-level rise of just recurrent flooding ... you should be very reluctant and cautious in completely devastating that fund,” Lewis said. “This was going to provide a significant source of revenue.”

In his remarks to the chamber, Youngkin pledged to formulate a plan to “combat sea-level rise” before vowing to get the state out of RGGI via executive action. Asked about his authority to do so, Youngkin’s transition office issued a statement saying, “Virginia’s participation is governed by a contract agreement, signed by the Department of Environmental Quality and other regulations.”

Language in the statute directs the Department of Environmental Quality to manage the auction program under RGGI, Jaffe said, so that may be the avenue Youngkin is exploring, because the governor has the authority to direct the department’s actions. But under the legislation, the state’s Air Pollution Control Board has already promulgated regulations establishing a multistate trading program, he said.

“The governor cannot just undo regulations that he might not like via executive order,” Jaffe said, noting that it would be up to the seven-member board, currently all Democratic appointees, to change the regulations. Youngkin will not have the chance to put his own appointees on the board until July, when two seats will become open.

The members’ staggered four-year terms are “designed so you avoid this kind of whiplash,” Jaffe said.

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