As the world grapples with the escalating climate crisis, the spotlight has shifted to states and regions to lead the charge in driving sustainable change. In this landscape, a trailblazing partnership on the East Coast of the United States offers a compelling model for collaborative, multi-state action – the Regional Greenhouse Gas Initiative (RGGI).
Established in 2005, RGGI is the country’s first regional cap-and-invest system for reducing carbon emissions from power generation. This innovative program brings together 11 states – Connecticut, Delaware, Maine, Maryland, Massachusetts, New Hampshire, New Jersey, New York, Pennsylvania, Rhode Island, and Vermont – in a unified effort to address the climate crisis.
The Power of Collaboration
“RGGI has not only been an effective climate policy, it’s been an extraordinary example of how states can work together on common goals,” says Daniel Sosland, president of the climate and energy nonprofit Acadia Center. “It is a major vehicle for climate policy now in the states, more than it might have seemed before the election.”
The stakes have indeed grown higher in the face of the reelection of former President Donald Trump, whose administration actively worked to roll back federal climate action. This shift has left it up to cities, states, and the private sector to maintain the country’s momentum on clean energy. In RGGI, states have found a powerful model for scaling their impact through collaboration.
The RGGI Approach
At the heart of RGGI’s approach is a cap-and-invest system that sets a limit on the total carbon emissions from power plants within the member states. Each power plant must acquire allowances from the state, up to the total cap, for every ton of carbon dioxide they emit in a given year. The cap is lowered over time, forcing power plants to either reduce their emissions or pay more to acquire the dwindling pool of allowances.
The proceeds from these allowance auctions are then reinvested by the states into programs that further reduce emissions and assist energy customers. These initiatives include energy efficiency projects, direct bill assistance, and renewable energy development.
“It has really thrived and been really effective across multiple administrations,” says Jackson Morris, state power sector director with the Natural Resources Defense Council. “RGGI is a winning model. It’s not theoretical – we’ve got numbers.”
Proven Track Record
The numbers indeed speak for themselves. Since 2008, RGGI has generated $8.3 billion for participating states, and carbon dioxide emissions from power generation in the nine states that have consistently participated have fallen by about half between 2008 and 2021 – a considerably faster rate than the rest of the country.
“RGGI is a winning model. It’s not theoretical – we’ve got numbers.”
- Jackson Morris, Natural Resources Defense Council
This success has been maintained despite political shifts, with the program weathering the “political winds” and garnering broad bipartisan support over the years, as noted by Bradley Campbell, president of the Conservation Law Foundation and a former commissioner of the New Jersey Department of Environmental Protection who was involved in RGGI’s founding.
Adapting to a Changing Landscape
Yet, as the climate crisis deepens and federal support for decarbonization efforts wanes, RGGI will need to make some carefully considered program design decisions to continue delivering meaningful impact.
One key question under consideration is whether to maintain the existing trajectory for the overall emissions cap – a 30% reduction between 2020 and 2030, followed by a steady limit – or to further lower the cap after 2030. The RGGI states are also contemplating a potential change to the compliance schedule, which could require power generators to acquire allowances worth 100% of their annual carbon emissions and certify compliance annually, rather than the current three-year cycle with only half the allowances needed for the first two years.
“At this point it is critical for states to maintain a high level of ambition when it comes to programs like RGGI,” says Paola Tamayo, a policy analyst at Acadia Center. “There are different mechanisms that they can implement to accommodate other states.”
Accommodating New Participants
The program review currently underway is aimed at finding ways to appeal to potential new participant states that may have less aggressive decarbonization goals than the current members, without compromising the overall impact on emissions reduction. Acadia Center has suggested mechanisms such as giving proportionately more allowances to states with more stringent emissions targets, to incentivize tighter limits.
“The basic infrastructure has weathered the political winds over the decades.”
- Bradley Campbell, Conservation Law Foundation
The program review is expected to yield a model rule in the coming months, with further updates possible as the RGGI states gather and consider feedback on accommodating new participants. This collaborative approach has been a hallmark of RGGI, and it will be crucial moving forward.
The Importance of State Leadership
As the federal government steps back from climate action, the responsibility falls on states to lead the way. Campbell emphasizes the need for states with strong emissions reduction mandates, such as Massachusetts, Maine, and Vermont, to accelerate the implementation of their climate laws.
“It’s especially important that the states that have strong emissions reduction mandates speed up the implementation of their climate laws,” he says. “State leadership on these issues is going to be more important than ever.”
A Beacon of Hope
In the face of diminishing federal support, the Regional Greenhouse Gas Initiative stands as a beacon of hope, demonstrating the power of multi-state collaboration to drive meaningful climate action. As the program navigates the challenges ahead, its success could serve as a model for other regions seeking to unite in the fight against the climate crisis.
At Café Mila, we are closely following the progress of RGGI and the innovative ways in which states are stepping up to lead the charge on sustainability. As a hub of nourishment, wellness, and cultural exploration, we are committed to aligning our practices with the principles of environmental stewardship and community empowerment that are embodied by initiatives like RGGI.
Through our seasonal menus, mindfulness workshops, community partnerships, and sustainability initiatives, we strive to be a part of the solution, inspiring our patrons to make choices that positively impact the planet and their well-being. By staying informed and engaged with the latest developments in regional climate action, we can continue to be a sanctuary of hope, resilience, and collective progress.
