Bill of the Day: Defending RGGI
Updated on March 4th, 2022.
High Water Paddlers, Richmond, Virginia. Image credit: Jenn Clarke
What is RGGI?
In 2020, Virginia passed the Clean Energy and Community Flood Preparedness Act, allowing the commonwealth to join the Regional Greenhouse Gas Initiative (RGGI, pronounced ‘reggie’) and establishing the Virginia Community Flood Preparedness Fund (CFPF). RGGI is a market- based program with 11 participating states that generates new funds while reducing electricity sector emissions. This pollution reduction program drives down greenhouse gas emissions which improves air quality and public health while also bringing in desperately needed revenue to help Virginia’s families with energy bills and flood protection.
The Clean Energy and Community Flood Preparedness Act directs 50% of RGGI revenue to low-income energy efficiency programs, 45% to flood resiliency projects, and 5% to administrative costs. In Virginia’s first year of participation in RGGI, the Commonwealth received $228 million from RGGI auctions. These proceeds are already being used to create more energy-efficient, affordable housing units, help low-income families reduce energy bills, and enhance community flood prevention and protection.
2022 General Assembly Legislation on RGGI
This year, VCN and our Network Partners are opposing a series of bills which would repeal or undermine Virginia’s participation in RGGI and strip funding for families to ensure flood resiliency and energy efficiency in homes:
DEFEATED!
HB5
HB5 diverts funding from the Community Flood Preparedness Fund (FUND).
Delegate Ware
HB73 removes the “public interest” designation for clean energy and energy storage projects earmarked for low income and elderly populations, making access to cost-saving energy efficiency programs more difficult for vulnerable populations. The bill also removes the “public interest” designation from energy storage and offshore wind facilities removes viable options for reducing emissions and achieving a 100% carbon free power sector.
Delegate Freitas
HB118 completely repeals Virginia’s carbon cap-and-trade program and participation in the Regional Greenhouse Gas Initiative. The repeal would remove our clean energy procurement goals, the Virginia Clean Economy Act’s (“VCEA”) renewable portfolio standards, the VCEA’s offshore wind development provisions, and the VCEA’s prioritization of cost-saving energy efficiency programs. Repealing these key provisions will take Virginia in the wrong direction at a time when we need to be reducing emissions and encouraging the development of renewable energy.
Delegate Kilgore
HB892 would give more than 7 million severely discounted allowances at a rate of $2/allowance to a private sophisticated company—LS Power—which has raised over $47 billion in financing since 1990. The most recent market allowance were priced at $13/allowance. This bill would rig the market price of allowances for a single company, stripping tens of millions of dollars from low-wealth families trying to reduce their electricity bills and localities trying to address recurrent flooding, for the benefit of a private sophisticated company. LS Power would not only save, but profit from this proposal—it could sell already-acquired allowances at market rates and then turn around and purchase $2 allowances for compliance purposes in 2021 and 2022.
Delegate Kilgore & O’Quinn
HB1301 would repeal Virginia’s participation in RGGI – a program already reducing pollution while directly helping communities on the front lines. Virginia’s participation not only reduces air pollution and improves public health, it also brings in critically needed funds. These funds are already helping thousands of low-wealth families reduce energy bills and climate impact, and localities deal with increasingly devastating floods.
Senator McDougle
SB398 rigs the carbon market for the profit of a private, carbon-polluting company.
Senator Stuart
SB532 repeals Virginia’s participation in RGGI.
Senator Kiggins
SB569 reduces the amount of communities that could apply for Community Flood Preparedness Fund grants.
Take Action
With incredible advocacy by our Partners, we have successfully amended or defeated all bills which would undermine Virginia’s participation in RGGI! See the final outcome of these bills below:
- HB5 was tabled in House Appropriations (18-yes, 0-no).
- HB73 was passed by indefinitely in Senate Commerce and Labor (9-yes, 5-n0).
- HB118 was passed by indefinitely in the Senate Commerce and Labor (12-yes, 3-no).
- HB892 was passed by indefinitely in Senate Finance and Appropriations (9-yes, 6-no).
- HB1301 was passed by indefinitely in Senate Agriculture, Conservation and Natural Resources (8-yes, 7-no).
- SB398 was passed by indefinitely in the Senate Finance and Appropriations Committee (11-yes, 5-no).
- SB532 was passed by indefinitely in the Senate Finance and Appropriations Committee (8-yes, 7-no).
- SB569 was continued to 2023 in Senate Finance and Appropriations (11-yes, 5-no).
Thank you to our many partners who successfully advocated for the Regional Greenhouse Gas Initiative, including SELC, EDF, Wetlands Watch, and Chesapeake Bay Foundation!
Reasons to Defend RGGI
The Virginia Community Flood Preparedness Fund (CFPF). The CFPF is solely funded by RGGI proceeds. In 2021, Virginia received $102.4 million for the CFPF. Over the next ten years, RGGI proceeds could generate upwards of $750 million for the CFPF – but only if Virginia stays in RGGI. The CFPF provides loans and grants for projects, studies, capacity building, and planning anywhere in the Commonwealth. These projects identify and address vulnerability for communities from sea level rise, stormwater, tidal flooding, and other flood risks. Find fact sheets on localities with CFPF grant projects here.
Weatherization Projects. RGGI weatherization projects reduces energy consumption, lowers energy bills for low-income households, and creates a healthier and safer living environment. RGGI prioritizes the elderly, persons with disabilities, and families with children for weatherization project funding. Weatherization can save Virginia families an estimated $976 on electricity bills each year.
In the first year, $15.2 million was been allocated from RGGI to weatherize the approximately 1,064 homes that would have otherwise been deferred in Virginia. With RGGI revenue, hundreds of home repairs and weatherization services for low-income families have been completed or are in the active pipeline.
Energy- Efficient Affordable Housing. Nearly 30% of Virginians are burdened by housing costs – meaning they are forced to spend 30% or more of their income on housing. Energy bills cause most of the burden: 164,000 Virginia households living below the poverty level pay about 31% of their income on energy costs, and another 179,000 pay about 17% of their income – far exceeding the 6% threshold considered to be non-burdensome.
Through RGGI funds, hundreds of additional efficient affordable housing units are in development, with thousands more to come. Through just the initial round, the state has awarded 11 affordable housing grants representing 705 energy-efficient units in South Boston, Charlottesville, Albemarle, Fairfax, Henrico, and Wytheville.
