The Nature Conservancy strongly supports Virginia’s continued full participation in the Regional Greenhouse Gas Initiative (RGGI) and the full distribution of revenue of RGGI funds as prescribed in the Code of Virginia (§ 10.1-1330. Clean Energy and Community Flood Preparedness). 

The benefits of RGGI to the Commonwealth are numerous.  Our comments will focus on the benefits of RGGI revenue for energy efficiency programs for low-income households.  We are also very supportive of the use of RGGI funds for the Community Flood Preparedness Fund, as addressed in the comments of other organizations. 

Half of the revenue that Virginia acquires through RGGI auctions is designated for low-income energy efficiency programs, including programs for eligible housing developments, administered by the Department of Housing and Community Development (DHCD).  DHCD has created the Housing Innovations Energy Efficiency (HIEE) program with the RGGI funds.

RGGI Energy Efficiency Benefit #1: Reduced air pollution

Using RGGI revenue to reduce wasted energy through energy efficiency is a direct way to lower unnecessary pollution.  Since energy efficiency upgrades are being done on households that could not otherwise afford the upgrades, RGGI is directly causing cleaner air through improved energy efficiency.

RGGI Energy Efficiency Benefit #2: Lower energy bills for the households that most need them

Through energy efficiency improvements, the RGGI HIEE program reduces the high energy bills of low-income households. This is a wise investment in Virginian households.  Rather than relying on bill assistance programs which must go on indefinitely, RGGI HIEE fixes the underlying root of the problem – poor insulation and inefficient appliances – to help families consume less energy in the first place.

RGGI Energy Efficiency Benefit #3: Improved health outcomes

The RGGI HIEE program can provide health benefits to program participants. Energy efficiency and weatherization improves ventilation and regulates indoor temperature and moisture, leading to lower rates of asthma, allergies, hypertension, heart disease, and other costly medical conditions.[1]

RGGI Energy Efficiency Benefit #4: Local jobs

The RGGI HIEE program is generating economic benefits by hiring local contractors and subcontractors across the state, creating local jobs that cannot be outsourced. 

Two intelligent DHCD Housing Innovation in Energy Efficiency program components

DHCD has developed two components to the HIEE program.  First, DHCD uses RGGI HIEE funds to make new Affordable and Special Needs Housing more efficient than it otherwise would be. This investment keeps this housing affordable while also lowering the monthly energy bills for its residents.

The second DHCD HIEE program is the Weatherization Deferral Repair Program (WDR), an innovative program which is rightfully gaining interest from other states for its ability to solve what had been an intractable problem.  DHCD administers the federal Weatherization Assistance Program (WAP) to low-income households.  However, almost 20% of WAP applicants in Virginia are turned down or “deferred” for this program because their home needs repairs before it can support the weatherization.[2]  Because the residents do not often have the funds to repair the building, it does not qualify for WAP upgrades, perpetuating the cycle of paying too-high energy bills.  DHCD’s WDR program invests RGGI revenue to make those repairs in order to unlock the federal WAP dollars to weatherize Virginia homes.  Given that all the benefits of WAP had previously been out of reach for many, leveraging RGGI revenue to tap into federal dollars is important and should continue.

We have outlined four major benefits from RGGI energy efficiency revenue: less air pollution, lower energy bills, better health outcomes, and more local jobs. 

The longer Virginia stays in RGGI and puts RGGI revenue to work as designed, the more these benefits will accrue for society.  That’s important, because the need to improve energy efficiency for low-income households is huge, and the benefits extend beyond the families living in them.  There are no other sources of funds that comes close to matching RGGI if these funds are revoked.  In fact, in 2021, the RGGI auctions brought in millions of dollars more than every other energy efficiency program in the state – combined.

DHCD’s HIEE program has only just begun.  The potential benefits of what it can achieve for Virginians with RGGI revenue is substantial.  We ask the Air Board to reject proposals to end Virginia’s participation in RGGI.

Lena Lewis, Energy and Climate Policy Manager

The Nature Conservancy Virginia Chapter

October 25, 2022