“I’m actually saving money.” Pioneering 10-state climate program slashes energy bills.
The Bronx, New York house Sandra England lives in with her elderly mother was cold in the wintertime — very cold. The furnace worked, but as soon as it shut off, temperatures in the house would drop again. The loss of heat concerned England, who works as a caregiver for older adults.
“My mother is 80 years old,” says England. “She’s home all day.”
England and her mother were also spending a ton of money on heating oil — “maybe $5,000 a year.”
But today, their home is snug and warm, and their heating bill is about half what it used to be, thanks in part to funding from a multistate climate initiative that cuts power plant pollution while generating hundreds of millions of dollars each year that states invest in communities and businesses. The Regional Greenhouse Gas Initiative, or RGGI, has already provided direct support to 8 million families and 400,000 businesses across the Northeast and Mid-Atlantic.
A new update to the 10-state compact, finalized this summer, will enhance benefits for hundreds of communities — all while cutting climate pollution from power plants in the region by as much as 92% by 2033.
RGGI helps families and cuts pollution
Power plants are the country’s second-largest source of climate pollution. (Transportation is the first.) RGGI has helped reduce climate pollution from the region’s power plants by 46%, compared to 2005 levels, a drop that significantly outpaces the country as a whole.
As the Trump administration moves to gut federal climate protections and block clean energy projects that would help hold down energy prices and decrease the dangers of climate-driven extreme weather events, RGGI is helping reduce energy costs, clear the air and cut the climate pollution that’s turbocharging dangerous weather events like this summer’s deadly floods in central Texas.
“Right now,” says Peter Della Rocca, a senior energy analyst at the nonprofit Environmental Defense Fund, “there’s a vacuum of federal leadership on climate and clean energy. The RGGI states are picking up the slack.”
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Bipartisan action to cut pollution
Two decades ago, New York’s Republican Governor George Pataki, concerned about climate change, reached out to fellow governors across the Northeast.
At the time, power plants were the nation’s and the region’s leading source of climate pollution, producing 33% of the nation’s total. (Today, they are still responsible for 24%.)
Together, the RGGI states devised the country’s first “cap-and-invest” program to cut climate pollution from power plants. It was novel at the time — a market-based solution that acknowledged the health and environmental costs that pollution creates, costs that were previously unaccounted for on power companies’ balance sheets.
RGGI set a limit on the amount of pollution power plants can produce — the “cap,” which declines every year — and then required power producers to pay for the pollution they created by buying allowances from RGGI at quarterly auctions for each ton of climate pollution their power plants produce.
Each state — Connecticut, Delaware, Maine, Maryland, Massachusetts, New Hampshire, New Jersey, New York, Rhode Island and Vermont — receives proceeds from these auctions and invests them in programs that reduce energy bills, improve energy efficiency, support clean energy and more, providing a host of health and cost-saving benefits for communities.
Over RGGI’s first 12 years, the economic benefits to the region totaled $5.7 billion, according to research by the Analysis Group. In that same time period, RGGI created 4,000 jobs.
Between 2009 and 2014, RGGI produced an additional $5.7 billion in health benefits for the region — with fewer premature deaths, heart attacks, asthma cases and other respiratory diseases that result from polluted air.
Investments made through RGGI in 2023 alone will prevent 7.7 million tons of climate pollution in the long run — as much as 1.6 million cars produce in a year. And residents and businesses will save more than $20 billion on their energy bills, thanks to RGGI-funded efficiency measures and energy bill assistance programs.
“RGGI creates a kind of win-win-win for everyone in the region,” says Della Rocca. “It protects our health, reduces climate change and saves us money all at the same time.”
Making RGGI stronger
Built into RGGI’s design is a periodic review that the states undertake to make sure the program is fulfilling its promise and keeping up with the latest scientific recommendations.
The new cap will reduce power plant pollution by almost 80% by 2030. That’s in line with recommendations from scientists about how to best forestall the worst impacts of climate change. The cap continues to drop over the following decade.
In the face of the Trump administration’s aggressive attempts to roll back both climate and clean energy progress, that’s good news for the people of the RGGI region and the country as a whole.
Since RGGI launched in 2009, both California and Washington state have created similar pollution-cutting programs, which cover not only power plants but also other sources of climate pollution — oil refineries, large industrial facilities and fuel distributors. Together, all three cap-and-invest programs have raised $45 billion for communities in their respective states.
Those benefits literally hit home for people like Sandra England. In 2023, when she heard that she might be able to get the house weatherized — new insulation, caulking to keep the drafts out — for free, she “thought it was too good to be true,” she says.
It wasn’t. England’s income qualified her for New York State’s Empower+ program, which paid to insulate her house.
After the free weatherization, her home is now warm in the winter and cooler in the summertime. Her heating bills have been pretty much cut in half. She’s recommending New York’s Empower+ program to her neighbors and friends.
“I’m actually saving money,” she says.
