The high consumer costs of Gov. Josh Shapiro’s two climate-related energy proposals will have a damaging effect on the state’s economy, according to the Commonwealth Foundation, which develops and advances fiscally conservative and libertarian public policies.
The Harrisburg, Pa.-based foundation on May 27 released its latest energy report, which examines the costs and impacts of Shapiro’s Pennsylvania Climate Emissions Reduction Act (PACER) and the Pennsylvania Reliable Energy Sustainability Standard (PRESS).
“Pennsylvania is an electricity powerhouse and an energy leader for the nation,” said Commonwealth Foundation Senior Manager of Energy Policy André Béliveau. “Any proposal that undermines this standing should face scrutiny, especially those as vast as Gov. Josh Shapiro’s PACER and PRESS proposals.
“The analysis found PACER and PRESS to be harmful for the future of Pennsylvania’s energy landscape and unreasonably expensive for Pennsylvania’s families and businesses,” Béliveau added.
PACER is a carbon tax on power producers resulting in economy-wide implications. PRESS would expand the commonwealth’s alternative energy mandates, requiring that more of Pennsylvania’s electricity come from unreliable energy sources, like solar and wind, by 2035, he pointed out.
According to the report, by 2035, PACER and PRESS would impose $157 billion in additional statewide electricity costs for businesses and households.
Most of these costs — about $155 billion — stem from PRESS compliance, and $2.2 billion from PACER, the report says.
With PACER and PRESS, overall electricity rates would increase by 60 percent and residential electric bills would more than double. By 2035, annual electric costs would rise by $1,754 for households, $5,554 for commercial businesses, and $178,620 for industrial customers, states the report.
PRESS would necessitate a massive overbuilding of wind, solar, and batteries to compensate for their unreliability — costs not needed with more reliable forms of power generation, such as natural gas, coal, and nuclear power, the foundation said.
“Even more concerning, these proposals harm Pennsylvania’s abundant energy resources, such as natural gas, that position the state as a regional leader in emissions reduction and reliable electrical generation,” said Béliveau. “Political favoritism toward unreliable and costly energy sources, like solar and wind power, would devastate the commonwealth’s economy and harm families.
“Pennsylvanians should not foot the bill for an energy plan that undermines Pennsylvania’s energy future and the quality of life for its citizens,” he said.
Additionally, the report says that under PACER and PRESS, electricity prices would surge from 12.58 cents per kilowatt-hour (kWh) in 2023 to 20.17 cents per kWh by 2035, a 60 percent increase that would hit Pennsylvanian families, small businesses, and manufacturers alike.
“Governor Shapiro’s ‘Green New Deal’ is the antithesis of good energy policy. If the governor truly wanted to ‘get stuff done’ on energy, he would abandon his current plans and work with the General Assembly on real solutions to secure reliable and affordable power in the commonwealth.
At the same time, PRESS mandates nearly triple Pennsylvania’s power plant capacity — from 45.5 gigawatts (GW) to 124 GW by 2035 — driven almost entirely by wind, solar, and battery storage.
“This immense buildout is not to meet rising consumer demand but to compensate for the intermittency of solar and wind, imposing massive costs for capacity that the grid would not need for dispatchable or baseload energy sources,” according to a summary of the report.
Carbon dioxide (CO₂) reductions under PACER and PRESS also are two times higher than the estimates of climate benefits outlined under the Biden administration’s Social Cost of Carbon (SCC), delivering a net economic harm to Pennsylvania.
“The data could not be clearer: Pennsylvania cannot afford PACER and PRESS,” said Béliveau. “The way to bolster Pennsylvania’s energy dominance is to support policies that promote affordable and reliable power, rather than handing over taxpayer dollars to green energy special interests.”