The Regional Greenhouse Gas Initiative is designed to discourage the release of pollutants from burning of fossil fuels. Ten states are part of the coalition and on July 1st Virginia will join, pledging to cap the amount of carbon dioxide utilities can release.
For every ton over that limit, they’ll have to pay, creating a pool of money to do two things.
“Flood resilience planning and retrofit low-income housing for energy efficiency," says UVA Professor Bill Shobe. He studies the economics of energy and notes that utilities pass the cost of excess carbon dioxide production to consumers. In two states – New Hampshire and New Jersey -- RGGI money is rebated to them.
“It has a huge effect on electricity affordability at a time when this is a really big concern for people.”
When Virginia first joined RGGI under Governor Ralph Northam, the state took in about $250 million. Now, Shobe says, it could collect three times that much. If Governor Spanberger approves the budget, 45% of RGGI revenue will go back to consumers. Those set to receive payments include residential customers, small businesses and houses of worship served by Dominion and Appalachian Power. Spanberger may also amend the budget to include those served by small, electrical coops.
