The states have long been pioneers of progress in America, running experiments that help us discover solutions to our toughest challenges. Virginia has a chance to tackle the defining issue of our time: climate change.
Leaders in Richmond should seize the opportunity by embracing two regional initiatives: the Regional Greenhouse Gas Initiative (RGGI), which is lowering emissions in the power sector, and the Transportation and Climate Initiative (TCI), a multistate collaborative effort facilitated by the Georgetown Climate Center to reduce emissions in transportation.
Together, the power and transportation sectors account for well over half of all emissions in our economy. These two plans combined would put Northeast and Mid-Atlantic states on a course to cap and reduce those emissions.
How would they work? Both plans use the power of competitive markets to change behavior and encourage innovation, first by placing a regional cap on emissions and then requiring companies to buy or trade allowances to emit up to the limit of the cap. Because the cap reduces annually, the allowance price will rise every year. This gives companies the certainty they need to invest and develop technologies faster and at the scale required.
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Over the past 10 years, the RGGI has proved successful in reducing power sector emissions. This should give policymakers confidence that emissions can be reduced in transportation as well without inflating energy costs or hurting local economies.
Since 2008, power sector emissions have plummeted in the states belonging to the RGGI at a rate almost double the rest of the U.S. Critically, GDP in these states outpaced growth elsewhere by 31% over the same decade, proving states don’t have to choose between the economy or the environment. Joining these programs would also give Virginians a reason for optimism on climate change. While there’s no doubt global carbon emissions are trending in the wrong direction, the RGGI’s success shows how targeted carbon pricing programs are working across the region.
These proposals also help sustain low carbon policies more broadly. Carbon pricing policies like the RGGI and the TCI help create carbon reduction projects that earn the credits essential to making pricing programs — like those in California and others around the world — work as designed.
Like states, businesses are also drivers of innovation and progress. And BP wants to do its part in reducing global emissions.
BP’s new CEO, Bernard Looney, recently announced our ambition to become a net zero company by 2050 or sooner. BP’s support for carbon pricing is part of this bold vision. We believe in it so much, we’re stopping corporate reputation advertising and redirecting that money to promote net zero policies.
But while companies like BP can — and must — play a leading role in bringing about a lower carbon future, strong and effective government policy is essential. Put simply, the world isn’t moving fast enough to curb emissions and limit the impacts of climate change. While a national carbon pricing program would be the gold standard, state and regional plans can play a critical role now. And we can’t wait.
That’s why BP supports well-designed carbon pricing programs. Carbon pricing is the most efficient and comprehensive way to reduce greenhouse gas emissions. By putting these plans into action, Gov. Ralph Northam and the General Assembly can act not only in their region’s best interests, but also in its best traditions dating back to our nation’s founding: boldly testing ambitious new ideas to improve the lives of Americans.
As Supreme Court Justice Louis Brandeis said, states are the “laboratory of democracy.” That’s happened with RGGI on carbon emissions in the power sector, and it can happen again in transportation. BP urges Virginia lawmakers to give America a model that will help move the nation closer to a low carbon future.
Susan Dio is chairman and president of BP America. Contact her at: uscommunications@bp.com
