Virginia Governor Glenn Youngkin’s revised budget, dubbed the Common Ground Budget, excludes language to rejoin the flawed carbon market known as the Regional Greenhouse Gas Initiative (RGGI). 

In 2020, Virginia entered RGGI—an 11-state cap-and-trade initiative that claims to be a “market-based effort” to reduce carbon emissions from the power sector—after the General Assembly voted on the measure in 2020 during the Northam administration. In three short years, Virginia imposed a $828 million carbon tax on ratepayers. 

Upon entering office, Governor Youngkin pledged to exit the controversial cap-and-trade program and dubbed it a carbon tax. And he’s not wrong. 

Dominion Energy, our major utility company, passes the cost of RGGI allowances to ratepayers like me. My recent Dominion statement showed I was still paying the RGGI rider surcharge valued at $4.43 per 1,000 kilowatt hours used. 

“RGGI describes itself as a regional market for carbon, but it is really a carbon tax that is fully passed on to ratepayers. It’s a bad deal for Virginians. It’s a bad deal for Virginia businesses,” Youngkin remarked  in December 2021. “I promised to lower the cost of living in Virginia, and this is just the beginning.”

Last June, the State Air Pollution Control Board voted 4-3 to exit the flawed carbon market—which became official last December. Starting this year, Virginia will sit out the next three-year RGGI compliance cycle

As I noted in the Virginian Pilot in January 2022, continued RGGI participation has a negligible impact on carbon emissions all the while increasing energy costs: 

The most notable problem with RGGI is its overall negligible impact on carbon emissions. In 2019, the Congressional Research Service observed that nine partner states “account for approximately 7% of U.S. CO2 emissions and 16% of U.S. gross domestic product” and called carbon emissions reductions “arguably negligible” at best.

When those numbers are broken down, it only accounts for a measly 1.4% in total U.S. emissions reductions. And even this reduction is largely attributable to the transition from coal to natural gas in the state.

Virginia’s continued participation in RGGI will result in residents paying more for their electricity bills. According to recent State Corporation Commission filings, participation in the RGGI program will raise energy costs to $4.37 a month, or $52.44 per year, if enacted on Sept. 1. When paired with the new — and costly — Virginia Clean Economy Act, the net-zero law slated to raise energy bills $800 a year by 2030, this spells disaster for Virginians currently paying more to heat and power their homes.

According to a RGGI fact sheet provided to our Center, the Youngkin administration notes Virginians will save an estimated $600 million on their energy bills going forward.  

That’s a win for Virginia’s ratepayers.

To learn more about RGGI and why carbon taxes are problematic, go HERE.