Keystone Generating Station, a coal-fired power plant in Armstrong County, about 50 miles northeast of Pittsburgh. (Capital-Star photo by Stephen Caruso)
By Rob Altenburg
In these trying times, Pennsylvania needs to move past obstructionist policies and politics to help forge a cleaner and healthier future for all of us.
Unfortunately, it’s been nothing but the status quo in Harrisburg this summer as the Legislature continues its clashes with Gov. Tom Wolf and over the response to COVID-19, election reform, and now the administration’s plan to cut carbon pollution by implementing a cap-and-invest program in Pennsylvania similar to the Regional Greenhouse Gas Initiative, popularly known as RGGI.
Despite the overwhelming need for Pennsylvania to reduce its carbon pollution — and despite the fact that a majority of Pennsylvanians support entering a program such as RGGI — the General Assembly this summer passed a bill (HB2025) sponsored by Rep. James Struzzi, R-Indiana, requiring the governor to seek legislative authorization before any cap-and-invest program can be implemented here.
This misguided bill would not only stop the Department of Environmental Protection from moving forward with their cap-and-invest plan, it would prevent any action at all to reduce carbon pollution in the state without the approval of a Legislature that has shown, time and again, it lacks the appetite for real action to cut emissions and fight the climate crisis.
Although the Struzzi bill passed the House and Senate, it didn’t clear either with a veto-proof majority. And Wolf governor has vetoed the bill, saying that it ignores the urgency to combat climate change and the need to protect public health.
Proponents of this bill want people to believe that it’s about preserving jobs or helping communities, but it’s clear that our coal-fired power plants will soon retire with or without RGGI and the Legislature has done nothing to address that reality.
The most recent example of this fact is General Electric’s announcement that it intends to stop building coal-fired power plants and instead focus on renewable energy and other means of power generation.
This decision is important, not just because of GE’s historical position practically inventing the modern electricity generation industry, but also as a cautionary tale of their disastrous recent bets on fossil fuels. Our Legislature should be very careful not to make the same mistakes.
In 2015 GE spent more than $13 billion to acquire Alstom, which nearly doubled its fleet of coal-fired power plants, and in 2017 spent $30 billion to take control of Baker Hughes, among other purchases in the oil and gas industry. Both of these acquisitions were based on the assumption that fossil fuel generation was a growth industry.
The reality was far different. By 2018—about a year after the Baker Hughes purchase—GE was selling off those shares at a significant loss and also booked a $23 billion write-down related to the Alstom purchase.
The factors that caused these massive losses for GE should be familiar to Pennsylvania. They assumed that the natural gas industry would continue to grow, despite plenty of evidence of a market glut.
They believed that coal generation would continue to be a significant player in the market well into the future, and they underestimated the rate at which the costs of clean renewable generation would decline. As a result, they overpaid for assets and ended up with little or no value in return.
In supporting the Struzzi bill, our Legislature is making those same bad bets.
The governor and the DEP have presented evidence that their plan to develop a RGGI-style cap-and-invest program will lower emissions, support economic growth, and help expand sustainable generation. The Legislature rejects this plan, but has yet to support an alternative solution to aid workers and support communities that will inevitably be impacted by fossil fuel plant closures and the impacts of carbon pollution.
Much like GE, the Legislature is acting as if the fossil fuel generation market is healthy and sustainable and nothing needs to be done.
To be clear, the coal industry in Pennsylvania will fade away, with or without RGGI. Now is not the time for obstructionist legislation that not only fails to implement a plan for these displaced workers, but also strikes down a very real and viable solution to cut our carbon emissions.
Instead of attempting to override the governor’s veto on the Struzzi bill, the General Assembly should work alongside him in crafting a plan that offers real solutions and alternatives for Pennsylvania workers before it’s too late.
Rob Altenburg is the director of the PennFuture Energy Center in Harrisburg
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