Gov. Josh Shapiro routinely laments that Pennsylvania is losing ground to Ohio in terms of family-sustaining, job-creating economic development projects, but Senate Republicans dispute how the governor’s recently revealed energy plan would address this.
“Making it more expensive to produce electricity in Pennsylvania compared to Ohio is not a way to start winning,” said Senate Majority Leader Joe Pittman, R-Indiana County.
That is the consequence he sees from Shapiro’s planned state-controlled carbon price regime. It would limit the amount of greenhouse gas emissions that power plants may emit and force them to purchase credits to operate, which Pittman and others argue would be passed on to customers.
Shapiro stated that 70% of the revenue from the “cap-and-invest” policy will be returned to Pennsylvania citizens in the form of refunds on electric bills. Nobody would pay more; most would pay less.
“I think everyone is going to lose,” said Sen. Greg Rothman (R-Cumberland and Perry counties). “All we’re going to do is raise utility rates for Pennsylvania families. We’re going to give some of them a rebate, which we wouldn’t have to do if we hadn’t raised the price. And we’re going to shift that energy production to Ohio,” where energy plants are being developed to take advantage of Pennsylvania’s natural gas wealth.
Along with promising to protect and create nearly 15,000 jobs, the governor’s proposal also aims to combat climate change by mandating utilities to purchase 50% of their electricity from primarily carbon-free sources by 2035, up from the current requirement of 18%.
Shapiro was not surprised by Republican lawmakers’ negative reaction to his proposal.
At a news conference at Cordia Energy, a Harrisburg energy producer, on Thursday, the governor said he heard them “chirping,” but Shapiro again stated, “Doing nothing is not an option.”
Pittman agrees with Shapiro on that point. He went on to say, “I think we constantly need to be looking at our energy policy broadly and figuring out what we can do better to make the most of the resources we have.”
He noted that his caucus had been discussing energy policy concerns. It has highlighted the potential dilemma that the state may face if demand for electricity exceeds generation capacity. Sen. Gene Yaw, R-Lycoming County, is considering legislation that is compatible with carbon capture and sequestration technology, and the caucus is also interested in rewarding hydrogen technology and small nuclear reactors.
“I believe that if we can use alternative energy to promote actual baseload power sources, we will create real, family-sustaining jobs. “That’s the focus,” Pittman added. “But cap and tax is not what we see as ultimately getting there.”
Furthermore, with the power required to support the expanding number of electric vehicles and data centers, Pittman stated, “it needs to be a bigger discussion than solar panels and windmills.”
Shapiro has stated that if the legislature approves his plan, Pennsylvania will withdraw from the Regional Greenhouse Gas Initiative. This multi-state project capped overall greenhouse gas emissions and required power facilities to purchase a carbon credit to operate. It gradually lowered the cap and increased the price of credits, incentivizing plants to reduce their emissions.
When Shapiro’s predecessor, Gov. Tom Wolf, joined RGGI without legislative approval in 2019, it became a source of contention for Senate Republicans and energy groups. They filed litigation in Commonwealth Court to block Pennsylvania from moving forward with the fee that RGGI would impose on electricity facilities, claiming that it was a tax that only the legislature could levy. They succeeded.
Shapiro filed an appeal with the state Supreme Court, which has yet to rule on it. The governor stated that while he was certain he could achieve an agreement with the legislature on an alternative to RGGI, he needed to appeal the court’s judgment to defend his and future governors’ executive authority.
Republican lawmakers argue that Shapiro should withdraw his appeal in that case first.
“From my vantage point, it seems to me the governor has acknowledged if we’re going to do any kind of cap and tax that the legislature has to approve it,” Pittman said in a statement. “That means he should drop his appeal, put this issue of RGGI behind us, and allow us to have honest conversations about other sources of energy production that we can proceed on.”
Shapiro termed this an excuse for inaction.
“For those who want to just complain for a few more years about RGGI and accomplish nothing, that’s only going to mean you’re not a competitive person,” he remarked. “You’re not someone who wants Pennsylvania to lead.”
However, Senate Republicans have not forgotten how they negotiated with Shapiro last summer to establish a $100 million restricted school voucher scheme, only to have him veto financing when House Democrats refused to support it.
“Credibility is everything,” Pittman explained. “At the end of the day, when he discusses what the legislature is going to do, they must realize where the House Democratic majority is in this debate. To give his [energy] plan the maximum legitimacy, the House should transmit it to us and allow us to understand how exactly this idea would operate.”