Today on Thanksgiving, Virginia can rightfully be grateful for—and proud of—true leadership.
As Governor McAuliffe approaches the end of his governorship, he has shown important vision as a resounding repudiation of Donald Trump’s “giant-step-backward” era, where mindless giveaways to fossil fuel’s beltway lobbyists hasten the costly climate change we all already pay for.
McAuliffe’s administration instead just took a significant step forward on tackling climate change and harnessing the booming clean energy economy: the Virginia Department of Environmental Quality’s citizen-led Air Board approved a proposal last week to reduce Virginia’s electric sector carbon pollution 30% by 2030.
That’s a big step, and a smart plan.
Not only is Virginia already facing some of the nation’s worst and occurring-right-now impacts of climate change, as the sea rises along its coast. Virginia has also been mostly sitting on the sidelines of the best way to combat climate change and spur economic activity: the clean energy economy.
Virginia has instead been relying on an outdated regime of coal (an expensive fuel that is highly polluting), nuclear (also expensive and which kicks off radioactive waste that we don’t know what to do with), and natural gas (a potent climate changing fuel, which has to be piped into Virginia from out-of-state).
Now, Virginia can modernize.
That means tapping energy efficiency to reduce not just its carbon pollution but also Virginia’s tenth-highest electricity bills in the nation. And it means growing a solar industry and the jobs that come with it, as well as eventually tapping Virginia’s vast offshore wind potential.
That is smart not just for reducing climate change costs tomorrow, but for for strengthening Virginia’s economy today.
But there’s another smart approach to McAuliffe’s climate action.
The Basics of Virginia's Smart Plan
First, Virginia plans to tackle climate change using market-based carbon allowances. That’s the same way we solved acid rain, a conservative's approach that was one of George H.W. Bush’s biggest presidential accomplishments.
Second, and most important, Virginia will link its market to the program that 9 states have already successfully undertaken: the Regional Greenhouse Gas Initiative (or RGGI, pronounced “Reggie”). The RGGI states have been so successful in reducing emissions (while also delivering significant economic benefits amid growth across their region) that the multi-state program recently elected to tighten their carbon reductions.
Economics 101 tells you the larger a market is, the more efficient and cost-effective. That’s what Virginia can expect, along with clean energy jobs and reduced energy bills after Virginia’s program gets going in 2020, if it invests in energy efficiency and lower-cost renewables.
Under the proposal the Air Board approved, those job and reduced energy bills are what we can expect after Virginia’s program gets going in 2020.
How the Rule Can be Improved
The carbon rule as proposed isn’t perfect.
Of particular note, Virginia gives a free pollution pass to power generators that burn wood for electricity, despite not knowing exactly from where that wood comes. We don’t know if those facilities are burning entire trees, which are cut down simply for that purpose. Woody biomass-derived carbon pollution are not insignificant, at about 2 million tons per year (or about 5% of Virginia’s total from the power sector).
Covering that pollution under Virginia’s forthcoming climate action plan would be smart for several economic and environmental reasons.
First, burning wood for electricity is generally an energy inefficient means of generating power, from both an energy and a carbon pollution perspective. This is especially true when you don’t know where the wood comes from, and whether we are simply burning whole trees. (As climate change worsens, trees are better off left in place to absorb carbon, rather than being burned for electricity to release that carbon.)
Second, it’s more economically efficient to cover woody biomass carbon polluters. If Virginia’s coal and gas generators are paying for their carbon pollution they’re putting into our atmosphere, but wood-burning polluters aren’t, that arbitrary discrepancy creates an artificial advantage for the wood burners. And yet the atmosphere gets just as much pollution, undercutting the purpose of the program.
Market distortions like that are inherently less efficient for the wholesale power markets in which Virginia takes part. For that Econ 101 reason, generators across Virginia and indeed the PJM region have an interest in a level playing field.
But because Virginia has an interest in stemming climate change and economic efficiency, this woody-biomass pollution kink should be ironed out as the proposed regulation becomes finalized in 2018.
That finalized carbon and clean energy plan should be a strong and smart program that delivers meaningful pollution reductions.
In this Donald Trump era of backward-marching, that’s no small thing!
Governor McAuliffe’s Climate and Clean Energy Leadership Record
Governor McAuliffe’s legacy as one of our country’s foremost climate change and clean energy champions undoubtedly took a huge leap forward with last week’s vote of approval from the citizen’s Air Board.
Next month, the Department of Environmental Quality’s citizen Water Board will be voting on whether or not to approve two large, carbon-intensive pipelines across Virginia. If built, those pipelines would not only impact Virginia’s waterways with pollution. Just as crucially, they would significantly displace, b y many billions, much smarter investment in Virginian clean energy.
And one of the two projects, Dominion Energy's Atlantic Coast Pipeline, would in fact harm Virginia’s economy. Dominion’s pipeline was premised on delivering lower cost energy and thus creating jobs. Those claims were the basis of McAuliffe’s support, as a pro-jobs, New Virginia Economy governor. But those claims have since been found to be a fallacy, as the pipeline would increase Virginia’s energy costs by up to 2.3 billion dollars (yes, that’s a B). As a result, the pipeline won’t create the jobs Dominion initially claimed.
This for-profit project instead appears to only benefit large energy consortiums at the expense of Virginia water and land. That perhaps explains why the pipeline is on Donald Trump's pro-polluter list of his Top 50 priority projects.
Building a pipeline that will harm Virginia’s economy is a steep, multi-billion dollar opportunity cost, and not just for McAuliffe’s New Virginia Economy. Those pipeline dollars will send carbon emissions up, when the rest of the world—and McAuliffe—knows they need to come down. The pipelines may also be an entirely wasted investment: when McAuliffe's carbon reduction rule has its intended effect, it will render carbon-polluting infrastructure, like these two large carbon exhaust pipes, obsolete.
The Bottom Line
Here’s hoping the Water Board recognizes that Virginia’s waterways will be unacceptably polluted by the pipelines, and does not approve the permits for these ill-considered, unneeded fossil fuel projects.
Not only would Virginia dodge a climate and economic bullet, but McAuliffe would show he is not Dominion’s turkey.
When that happens, Terry McAuliffe will leave office as one of America’s foremost leaders on climate change and clean energy.