HARRISBURG, Pa. — State House Republican members warned Pennsylvanians about what they call a new “energy tax” in Gov. Josh Shapiro's new state budget.
House Democrats disagree.
This debate over whether this is a tax or not stems from a program called the Regional Greenhouse Gas Initiative, or RGGI.
RGGI is an 11-state cooperative program aimed at capping and reducing greenhouse gas emissions from power plants.
This initiative will make polluters pay for allowances at state auctions for emitting a specific amount of carbon dioxide. States like Pennsylvania will use revenue raised at these auctions to invest in clean energy programs.
Former Gov. Tom Wolf made an executive order to join the program. Right now, it looks like it will remain in Shapiro's budget.
Republican state lawmakers sued over this order, claiming the state joining RGGI will create an unconstitutional tax on Pennsylvanians.
Shapiro’s budget for the 2023-24 fiscal year estimates the state will raise $663 million in revenue through RGGI.
Republicans say this revenue will equate to a carbon tax on companies and find its way reaching into residents' pockets.
"[It] will absolutely have an impact on consumers," said State Representative Torren Ecker, of Adams County. "Not only in their energy prices, but in the goods they buy from those that use energy."
However, House Democrats dismiss this being a so-called “carbon tax”—and the prospect of RGGI raising utility bills.
They say the fees collected from RGGI would not be used to fund the state budget, but instead would go directly into the state's Clean Air Fund.
A new study published in May by the University of Pennsylvania Kleinman Center for Energy Policy also points to a small or no raise to retail electrical prices.
Another recent study by Synapse Energy Economics said Pennsylvanians would save $2 per month by joining RGGI.
The House Democratic Caucus said in a statement to FOX43:
“These inaccurate claims about RGGI are nothing more than a distraction…it's unfortunate that Republicans voted against a budget that contains many of their own priorities.”
The House GOP policy committee hearing is at 10 a.m. on Monday at the Ryan Office Building, located in the Pennsylvania State Capitol Complex.