Pennsylvania Gov. Josh Shapiro introduced a new plan this week to impose a carbon-pricing system on the Keystone State’s energy producers. Left unmentioned: how exactly this plan will affect the energy bills of millions of Pennsylvanians.
Pennsylvania Gov. Josh Shapiro released a proposal on Wednesday to tax energy producers on their greenhouse gas emissions and mandate utility providers dramatically ramp up the use of renewable energy sources. If enacted, Shapiro’s plan would be the first carbon-pricing system adopted by a major energy-producing state.
Pennsylvania is the third-largest energy producer and is the second-biggest natural gas producing state in the country. Shapiro’s proposal, while light on details, would require Pennsylvania utility providers to buy 50% of their energy from renewable sources by 2035, a significant increase from Pennsylvania’s current mandate of 18%.
President Biden also campaigned on the platform of getting rid of fossil fuels, much like Gov. Shapiro. On his first day in office, he restricted offshore drilling and ended the Keystone XL pipeline through executive order. According to analysis by the Heritage Foundation, these initiatives and others like Shapiro’s would end with natural gas bills quadrupling for consumers.
The Commonwealth Foundation, a Pennsylvania-based think tank that seeks to “transform free-market ideas into actionable public policies,” blasted Shapiro’s “disastrous” plan in a statement. “Governor Shapiro is piling on even more financial pain for working Pennsylvanians at a time when they can least afford it,” said André Béliveau, the think tank’s Senior Manager of Energy Policy.
Béliveau continued, “Shapiro is actively breaking his campaign promises to avoid tax increases by saddling the state with strict new emissions limits that will inevitably raise consumer costs and have a chilling effect on our natural gas industry, which is leading in reducing carbon emissions.”
“Governor Shapiro’s energy tax will cause widespread destruction in every industry in Pennsylvania. 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, said David Taylor, the President and CEO of the Pennsylvania Manufacturing Association, in a statement.
Shapiro’s plan follows actions by the Biden administration to raise the “social cost of carbon,” the EPA’s metric for determining “the harm to the economy caused by one ton of carbon dioxide pollution,” from the Trump-era rate of $5 to $190. The new legally-binding social cost of carbon could be used to impose emissions limits on every smokestack and tailpipe in the US.
Sen. Gene Yaw, the Republican chair of the Senate Environmental Resources and Energy Committee, compared Shapiro’s policy to the carbon-pricing plan introduced by his predecessor, fellow Democrat Tom Wolf. Wolf’s plan was ruled unconstitutional by the courts. “The governor left out the real crisis we are facing in the next ten years — the generation of baseload electricity,” said Yaw in a statement. “By 2028, increased demand and lack of reliable thermal replacement generation will promote the collapse of the already strained electric grid.”
Approximately 60% of Pennsylvania’s electric power is generated at natural gas-fired power plants. The new 50% requirement under Shapiro’s plan could damage demand for energy generated by natural gas, one of the key drivers of both Pennsylvania’s economy and the United States’ reduction in CO2 emissions over the last decade.
