Democratic Pennsylvania Gov. Josh Shapiro on Wednesday unveiled a new energy plan that isn’t sitting well with Republicans in the legislature, businesses, and energy industry groups that denounced the two-prong strategy as an energy tax gone wild.
“Gov. Shapiro’s energy tax will cause widespread destruction in every industry in Pennsylvania,” said David Taylor, president and CEO of the Pennsylvania Manufacturers’ Association (PMA). “A new, additional tax on energy will jeopardize our vital industries and undermine the hardworking women and men on our shop floors while massively subsidizing boutique ‘green’ energy monopolized by China.”
Shapiro’s plan entails two proposed bills that he says together will lower prices for consumers, create and protect Pennsylvania jobs, and lower climate emissions.
First, the governor is proposing the Pennsylvania Climate Emissions Reduction (PACER) Act, which would establish a Pennsylvania-specific cap-and-invest program that allows the state to determine its own cap on carbon and invest directly in lowering consumers’ electricity bills.
If passed, PACER would take Pennsylvania out of the Regional Greenhouse Gas Initiative (RGGI), and give the Commonwealth control over its own energy future, according to Shapiro.
The second proposal is the Pennsylvania Reliable Energy Sustainability Standard (PRESS), which would require Pennsylvania to get 50 percent of its electricity from a diverse range of energy resources by 2035, including 35 percent from the clean energy sources like solar, wind, small modular reactors, and fusion; 10 percent from sustainable sources like large hydropower and battery storage; and 5 percent from ultra-low emission forms of natural gas and other traditional fuels.
“My priority is getting these two bills, PACER and PRESS, done,” Shapiro said during an event in Scranton on Wednesday to announce his plan. “This is what’s going to be my three-part test that’s going to create jobs, it’s going to protect our planet, it’s going to lower costs for consumers. It’s time to act now on these two bills.”
If passed by the legislature, the governor says his initiatives would save Pennsylvania ratepayers $252 million in the first five years, while generating $5.1 billion in investment in clean, reliable energy sources.
Shapiro added that the bills are expected to be introduced by his Democratic colleagues in the legislature by next week.
PMA’s Taylor said the governor’s energy tax will stifle Pennsylvania’s energy production and weaken America.
“At a time when inflation is a top issue facing American families, Gov. Shapiro’s energy tax will cut deep into the pockets of Pennsylvania’s consumers as it will add costs on every utility bill, product, and service in our Commonwealth,” he said. “This consumer pain will then subsidize government-selected technologies and projects dependent on foreign inputs with demonstrated human rights abuses and exploitation of child labor.”
Taylor also called the energy tax “a solution in search of a problem,” particularly as Pennsylvania has reduced CO2 emissions at a dramatic rate over the last 20 years driven by efficiency, innovation, and the deployment of best-in-practice technology across all industrial sectors.
“And these successes can continue without destroying Pennsylvania’s economy,” he said.
The Power PA Jobs Alliance, a coalition of labor, industry, and consumer stakeholders advocating against state proposals that impose carbon dioxide emission taxes, also criticized Shapiro’s plan.
“Unfortunately, Gov. Shapiro’s announcement today, billed as a ‘Major Energy Announcement About Securing Pennsylvania’s Energy Future,’ is anything but serious,” the group said in a statement.
For example, when Shapiro ran as a candidate for governor, he questioned the merits of the RGGI carbon tax, and as Attorney General, Shapiro refused to defend former Pennsylvania Gov. Tom Wolf’s effort to adopt the RGGI carbon tax through regulation, the alliance said.
“Now, as governor, [Shapiro] proposes virtually the same carbon tax on electric generation as he took issue with as a candidate and is defending the RGGI carbon tax regulation in court,” said the Power PA Jobs Alliance.
A Pennsylvania specific carbon tax-and-trade program, like RGGI, as demonstrated by the state Department of Environmental Protection’s own modeling, would not avoid, but directly lead to unfavorable environmental and economic outcomes for Pennsylvania, the alliance added.
The PA Coal Alliance, which is a member of the Power PA Jobs Alliance, said Shapiro’s plan disadvantages Pennsylvania businesses and would shutter the state’s few remaining traditional coal-fired generation sources, risking the reliability of the electric grid.
“As always, the coal industry stands ready to work with the governor on a sensible plan that includes a diverse portfolio of energy sources,” said the PA Coal Alliance. “However, advancing the similar, misguided policy of his predecessor not only imposes economic harm on Pennsylvania’s reliable energy resources, but incentivizes reliable energy production and future investments in surrounding states.”
The Pennsylvania Chamber of Business and Industry noted that while everyone wants to protect the environment and grow the state’s economy, one goal doesn’t have to come at the expense of the other.
“Pennsylvania is a global leader in energy production and reducing emissions, and policies going forward should build on this progress,” said PA Chamber President and CEO Luke Bernstein. “We await details on the governor’s proposals, which raise significant questions and concerns about the impacts on our residents, businesses, the environment, and our economy.
Legislators also reacted to Shapiro’s proposed plan.
State Senate President Pro Tempore Kim Ward (R-39) agreed that Shapiro’s proposal to implement a carbon tax would stifle Pennsylvania’s energy potential.
“There is room in our Commonwealth for all types of energy. We should incorporate the different energy sectors but not on the backs of ratepayers, which is what Shapiro’s proposal does,” Ward said in a statement. “Shapiro’s carbon tax proposal appears to be more aligned with states like California and Washington, who suffer from rolling blackouts and higher energy prices.”
Ward also pointed out that while Shapiro says that if his proposal is passed, he will drop the lawsuit that is keeping RGGI alive, she’s not buying it.
“I am asking Gov. Shapiro to immediately drop the lawsuit that keeps RGGI in place, and then we can begin to have a real and inclusive conversation about the future of Pennsylvania’s energy sector,” said Ward.
Likewise, State Senate Majority Leader Joe Pittman (R-41) added that the best way to swiftly advance meaningful discussions around energy policy is for Gov. Shapiro to remove the anvil of RGGI and drop his appeal to the Pennsylvania Supreme Court.
“Detrimental job losses and increased electricity costs imposed directly on consumers necessitates immediately closing the chapter of RGGI,” Pittman said, adding that “any cap-and-trade program applying solely to electric generation in Pennsylvania and not our competitors, does not fit the bill” for a beneficial energy plan.
“Pennsylvania needs to put electric generation, grid reliability and consumer affordability first, and our Senate Republican Majority will continue to focus on initiatives to promote investment and innovation here in Pennsylvania,” said Pittman.
Asked about whether he will enforce RGGI if these proposed bills don’t pass the legislature, Shapiro said he’s focused on getting them passed.
“I understand that that’s an issue that’s still winding its way through the courts,” said the governor. “I did not put in my budget an assumption of revenue coming from RGGI. I understand that that was a priority of my predecessor.”
Meanwhile, State Senate Democratic Leader Jay Costa, who represents District 43, applauded Shapiro for “restarting a conversation” around energy policy in Pennsylvania.
“Together with stakeholders across the Commonwealth, this plan meaningfully addresses three crucial priorities: jobs, the climate crisis, and consumers,” said Costa. “I look forward to discussions with our colleagues and industry leaders as we work to implement a strategy that positions us as a national leader in the energy sector.”