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Shapiro’s RGGI Exit Seals Budget Deal, Triggers Backlash in Pennsylvania

The move closes a yearslong legal dispute over joining the carbon market.

Overview

  • Gov. Josh Shapiro signed the withdrawal as part of negotiations that ended a prolonged impasse and cleared a roughly $50.1 billion state budget.
  • Because Pennsylvania’s entry had been tied up in court, the withdrawal moots the pending state Supreme Court review and the state never participated in allowance auctions.
  • Pennsylvania’s power-sector emissions outsize those of all current RGGI members combined, amplifying the regional impact on auction revenues and emissions accounting.
  • Environmental advocates and some Democrats criticized the decision as giving up a key climate tool, while the Commonwealth Foundation hailed it as a win for ratepayers and jobs.
  • Shapiro has floated a state program called PACER that could later link to RGGI, though it faces an uphill path in the Republican-controlled Senate, as Virginia signals a return to the compact.