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A lawsuit appealing Virginia’s removal from a regional carbon market will be allowed to proceed, a court ruled earlier this week.
The Circuit Court of Floyd County affirmed that the Association of Energy Conservation Professionals has standing to challenge the state’s decision to leave the Regional Greenhouse Gas Initiative.
The program, made up of 11 states in the Northeast and Mid-Atlantic, makes power plants of a certain size buy allowances for their carbon dioxide emissions. Those allowances then are sold at quarterly auctions, which generate revenue for the participating states.
Virginia lawmakers voted to join RGGI in 2020 under Democratic Gov. Ralph Northam, and the state started participating in auctions the following year.
The commonwealth has earned more than $827 million from the proceeds, which are then used to fund local energy efficiency and flood preparedness programs.
Republican Gov. Glenn Youngkin sought to remove Virginia from the market when he took office, citing increased energy costs for consumers from a Dominion Energy surcharge recouping the utility’s costs of complying.
The State Air Pollution Control Board opted to withdraw the state from RGGI last year, which prompted the ongoing lawsuit.
The Southern Environmental Law Center filed the suit in Fairfax County last summer on behalf of four environmental organizations. A few months later, a Fairfax court dismissed three of the groups from the suit and transferred it to Floyd County, where the fourth group is based.
The Association of Energy Conservation Professionals advocates on behalf of organizations that provide energy efficiency work in Virginia — including contracting with a program funded solely by RGGI.
The association’s lawsuit argues that the air board does not have the authority to end the state’s participation in RGGI.
The court is now weighing whether to suspend the state’s departure from RGGI while the lawsuit plays out.
“We are pleased with today’s decision, which allows this case to move forward and will ensure the administration’s decision to leave RGGI — which we have repeatedly alleged is unlawful — will be reviewed by a court,” SELC senior attorney Nate Benforado said in a statement Monday. “We look forward to the next steps in this action and will work as expeditiously as possible to get Virginia back in RGGI.”
The commonwealth’s last RGGI auction was in early December.
Virginia is not the only state facing litigation over the carbon market.
An appellate court recently struck down Pennsylvania’s ability to join RGGI, after lawsuits from state Republicans and members of the coal industry.
The court found that the Democratic governor’s attempt to join the initiative was an overstep in executive power because it would impose a tax on energy producers that only the state legislature can approve. Environmentalists plan to appeal the ruling.
In Virginia, Democrats make the opposite argument: Since the General Assembly voted to enter the state into RGGI, it’s illegal for the governor to reverse the move without lawmakers’ approval.