A Virginia state board overseeing air quality regulations approved a final rule pushed by Republican Gov. Glenn Youngkin to withdraw the state from the Regional Greenhouse Gas Initiative.
The four Youngkin appointees on the Air Pollution Control Board voted for the rulemaking after State Attorney General Jason Miyares (R) told the board it had a legal right to repeal RGGI. The other three members, who were picked by Youngkin's Democratic predecessor Ralph Northam, voted against the rule.
But the courts may ultimately decide whether the governor will be able to meet a self-imposed deadline to complete the RGGI repeal by the end of 2023.
When the air board approved the release of a proposed version of the rule in December 2022, two of its members abstained after questioning whether they were authorized to vote on the matter. The same month, the state legislature's Joint Commission on Administrative Rules, where Democrats hold a majority, objected to the Youngkin administration's strategy to use regulation to undo a state law.
"Just looking at the black-letter, statutory law, I don't see how a move to withdraw Virginia from RGGI could avoid a legal challenge," Cale Jaffe, a University of Virginia law professor, said in an email.
A legal challenge could be filed in state district court once the rule is published in the Virginia Register, said Nate Benforado, a senior attorney with the Southern Environmental Law Center and an outspoken RGGI proponent.
"We continue to believe the law requires Virginia to participate in RGGI and [that] the administration does not have the authority for this action," Benforado said in an email. He declined to speculate on what the next steps will be, saying doing so would be premature.
Youngkin praised the board's vote.
"Today's commonsense decision by the Air Board to repeal RGGI protects Virginians from the failed program that is not only a regressive tax on families and businesses across the Commonwealth but also does nothing to reduce pollution," the governor said in a press release issued shortly after the vote.
Youngkin, who promised during his 2021 campaign to repeal Virginia's participation in the 11-state carbon market, has argued that RGGI is adding costs to energy bills that state residents can ill-afford. Dominion Energy Inc. initially added $2.39 to the average monthly household bill to cover its RGGI allowance obligations and has since asked regulators for permission to add another $1.98. The governor's office did not respond to a request for comment on the air board's vote.
$590 million in proceeds
The Virginia General Assembly made RGGI a centerpiece of its 2020 Clean Energy and Community Flood Preparedness Act to help bring in new revenue for climate adaptation and energy conservation projects. The law accompanied the state's sweeping Clean Economy Act, which requires utilities operating in the state to deliver 100% carbon-free electricity by 2050.
Under the RGGI, power companies must purchase allowances for each short ton of carbon they emit. The market seeks to incentivize power companies to invest in cleaner energy sources by tightening the emissions cap over time.
Since its first auction in March 2021, Virginia has netted nearly $590 million in proceeds from RGGI auctions. The money is used for coastal resilience projects and to fund energy efficiency upgrades for low-income Virginians.
Thousands of Virginians commented on the Youngkin administration's proposed and final rule, with a vast majority in favor of keeping the state in RGGI. Many cited the market's economic and environmental benefits.
The state will receive another infusion of RGGI revenue after a quarterly allowance auction held June 7.
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