Arlington County Office of Sustainability and Environmental Management urges the Administration to remain a member-state under the Regional Greenhouse Gas Initiative (RGGI), as a high-performance mechanism for delivery of vital services and benefits to Virginia’s citizens and businesses. Participation in this market-based program provides direct, cost-effective benefits addressing energy efficiency opportunities for the vulnerable populations and addressing community resiliency.

More specifically, as a cap-and-investment compact, RGGI:

• Benefits incumbent utilities with a flexible and responsibly paced instrument for decarbonizing its energy resources that is cost-neutral to the utility
• Has kept costs for households low, which is especially important for low-income ratepayers, by distributing the expense of investments and allowing utilities to identify the most cost-effective, high-performance approaches to reduce emissions
• Funds Virginia programs that generate broad and deep benefits and co-benefits at a scale that cannot be otherwise duplicated, at a conversely low-cost-of-government
• Creates an investment stream that levels opportunity between high- and low-income communities and reduces profound, near- and long-term risk and cost burdens to Virginia constituents

Benefits incumbent utilities with a flexible and responsibly paced instrument for decarbonizing its energy resources that is cost-neutral to the utility

• RGGI’s market-based approach to reduce GHG emissions allows utilities to meet electricity demands without requiring a specific mix of generation sources, while allowing for flexible decision-making. Utilities can meet the environmental performance requirements of the program in the most cost-effective manner with the flexibility to plan and phase implementation in a responsible path toward a clean energy resource portfolio.
• The allowance market enables utilities to optimize their approach to decarbonization, encouraging early GHG reductions through allowance banking and multi-year compliance periods.
• The cost containment reserve mechanism of RGGI mitigates any risk associated with high allowance costs, thus limiting price volatility so utilities can plan energy generating resources for the future with limited uncertainty.
• At the same time, RGGI is a tailored, mission-specific program that will cease operation once decarbonization goals and defined outcomes are achieved.

RGGI has kept costs for households low, which is especially important for low-income ratepayers, by distributing the expense of investment and allowing utilities to identify the most cost-effective, high-performance approaches to reduce emissions

• RGGI costs to ratepayers are exceptionally low, and its benefits to the public represent diverse and substantive returns-on-investment. A study by the Analysis Group found that during the 2015-2017 compliance period, RGGI led to $1.4 billion in net positive economic activity regionally through investment in energy efficiency, renewable energy, bill assistance, and other measures to reduce GHGs.[1] RGGI has generated over $4 billion in net economic gain over its first ten years.[2]
• RGGI auction proceeds have also been used to fund research, education, and job training programs. Further, energy consumers saw a net savings of $220 million on energy costs during the 2015-2017 compliance period.[3]
• Over the first ten years of the program, CO₂ emissions from RGGI power plants fell 47% regionally while electricity prices in RGGI fell 5.7%, even while prices increased in the rest of the country.[4]
• Achieving environmental benefits at low cost is critical for ratepayers with lower incomes. The RGGI framework reduces GHGs, as well as other localized pollutants, at low cost. Further, auction proceeds can be directed to benefit communities most impacted by energy prices and pollution. In this manner, RGGI uniquely provides a powerful equity mechanism to its investment framework.

Funds Virginia programs that generate broad and deep benefits and co-benefits at a scale that simply cannot be otherwise duplicated, at a conversely low-cost-of-government

• By reducing emissions of NOx, SO_2, and other pollutants that negatively impact air quality, RGGI achieves significant co-benefits in the form of improved public health.
• A report from Abt Associates found that, from 2009 to 2014, RGGI saved 300 to 830 lives, avoided 8,200 asthma attacks, and generated $5.7 billion in health savings and other benefits by reducing harmful pollution from power plants.[5] Another study found that RGGI avoided 537 cases of childhood asthma.[6]
• Proceeds from RGGI in Virginia are allocated to the Virginia Community Flood Preparedness Fund, which provides funding for flood resilience. In its latest round, this fund provided $13.6 million to local and regional governments across the Commonwealth. This fund awarded over $32 million in 2021.[7]
• RGGI has funded critical, long-deferred investments in flood, encroachment, and subsidence mitigation projects, producing exponentially favorable, long-term returns and substantial reduction of present and future risk (loss and replacement, increased costs of operation and maintenance, impairments to economic activity, and loss of local and state revenue).
• As a well-established and high-functioning framework, RGGI provides a model to achieve these and other benefits at a low administrative cost to Virginia.

Creates an investment stream that levels opportunity between high- and low-income communities and reduces profound, near- and long-term risk and cost burdens to Virginia constituents

• Through the most recent auction, RGGI has provided the Commonwealth $452 million in auction proceeds,[8] which have been reinvested in projects and programs benefit residents and businesses across the Commonwealth
• Funding from RGGI auction proceeds unlock investment opportunities that can benefit communities of all income levels, but crucially can be directed to disadvantaged communities that are most impacted by pollution and energy costs.
• By shifting Virginia’s energy system to cleaner, low-carbon, and renewable sources, the Commonwealth increases energy independence and reduces its exposure to volatility in global energy markets, providing stable energy prices to its ratepayers.
• These investments create jobs for Virginians. RGGI led to net job creation in all nine participating states from 2015-2017, creating over 14,500 job-years in that period.[9] Over the first ten years of the program, RGGI created over 44,000 job-years.[10]

RGGI is a proven and cost-effective program that is vital for attaining Virginia’s energy and resiliency goals. Arlington County’s Office of Sustainability and Environmental Management strongly urges the Administration to remain in the RGGI program as a uniquely effective, low-cost framework for meeting the Commonwealth’s infrastructure, public health, financial performance, risk mitigation and equity goals.