Pennsylvania governor abandons major carbon trading program in budget deal with republicans

Pennsylvania Governor Josh Shapiro has withdrawn his state from the Regional Greenhouse Gas Initiative (RGGI), a major Northeast carbon trading program, as part of a political compromise to secure passage of the state’s long-delayed budget. The decision has sparked fierce criticism from environmental advocates and fellow Democrats who argue Shapiro sacrificed a crucial climate tool for short-term political gains.

RGGI operates as a cap-and-trade system where power plants purchase credits to emit carbon dioxide, with proceeds funding clean energy projects and consumer programs. The emissions cap gradually tightens over time to ensure declining pollution levels. Pennsylvania’s participation would have been massive – the state’s power sector emissions exceed those of all other RGGI members combined, including New York, New Jersey, and New England states. The program has generated $8.6 billion for participating states since its inception.

Shapiro defended the withdrawal as removing a Republican “excuse” for blocking energy discussions and promised aggressive pursuit of clean energy policies. He has proposed an alternative called PACER – essentially a Pennsylvania-specific version of RGGI that could theoretically link with the regional program later. However, critics doubt this state-only approach can pass the Republican-controlled legislature, whereas RGGI membership required only executive action.

The timing particularly frustrated advocates, as Pennsylvania’s Supreme Court was poised to rule on the program’s legality after years of Republican legal challenges. “We were about to have the answer from the court. And now we never will, because they gave up,” said Jackson Morris of the Natural Resources Defense Council, calling Democrats’ political strategy “baffling.”