Energy Policy Update: RGGI, Energy Choice & Carbon Capture Funding

On July 8, a state judge suspended further enforcement of the Regional Greenhouse Gas Initiative, a cap-and-trade program for power plants. However, on July 11, the administration appealed the decision on the injunction to the state Supreme Court, which had the effect of superseding the injunction temporarily while the higher court considers whether to review if the injunction was improperly granted. In the meantime, challengers petitioned the lower court to reinstate the injunction. The lower court gave the administration until the end of this week to respond to the arguments presented in the petition. Until the judge rules, RGGI is, for now, in effect in Pennsylvania again. RGGI Inc. posted documents last week ahead of the next scheduled quarterly auction in September, noting its plans to introduce nearly 16 million credits into the auction to accommodate Pennsylvania’s participation. If sold at recent credit prices, this would mean the imposition of more than $200 million in compliance costs to affected power plants and industrial sources just over a three-month period, on track for an annual cost of more than $800 million. Full arguments on the merits of the regulation will take place at Commonwealth Court this fall.

The Governor has vetoed SB 275, legislation that would have ensured access to the preferred energy resource of families and businesses across the state. The bill, supported by the PA Chamber, received strong bipartisan support in both the House and Senate, only to be rejected by the Governor on July 11. In his veto message, the Governor called the bill overly broad and likely to produce unintended consequences. The bill’s prime sponsor, Senator Gene Yaw, R-Lycoming, said he found the decision “baffling,” and that “policies limiting the use of certain fuel sources only slows environmental progress and raises energy costs. This veto will hurt the most vulnerable among us the hardest at a time when they can least afford it.”

Finally, the Department of Energy provided more detail on the timing and process for how it will spend $2.6 billion from the bipartisan federal infrastructure law in selecting and supporting carbon capture technology at coal and gas plans across the United States. DOE is anticipating beginning to accept applications in August or September, with funding decisions announced early next year. DOE is also expected to announce more detail in the coming months on its process for siting and selecting four regional carbon capture and hydrogen processing hubs. The PA Chamber is one of several dozen business, association, non-profit and union partners supportive of efforts to site one of the hubs in Pennsylvania.


Founded in 1916, the Pennsylvania Chamber of Business and Industry is the state's largest broad-based business association, with its membership comprising businesses of all sizes and across all industry sectors. The PA Chamber is The Statewide Voice of BusinessTM.