Regional Greenhouse Gas Initiative Inc

Background and Membership

In 2005, the states of Connecticut, New Jersey, Maine, Delaware, New Hampshire, Vermont, and New York signed the Regional Greenhouse Gas Initiative, a cap-and-trade program designed to limit greenhouse gas production in the energy sector to reduce climate change. ² In 2007, the Regional Greenhouse Gas Initiative was formed as a 501(c)(3) nonprofit to oversee the administration of the RGGI program. ³

Also in 2007, Massachusetts, Maryland, and Rhode Island signed the agreement. In 2008, the ten states signed an agreement for individual shares of CO2 production. ⁴

In 2008, the RGGI began holding CO2 emissions allowances auctions. The program’s goal was to decrease emissions in each state by 10 percent by 2018. ⁵

In 2009, New Jersey left the RGGI under then-Governor Chris Christie (R) over concerns of passing the costs of the program onto New Jersey citizens through higher taxes. In 2018, then-Governor Phil Murphy (D) reentered New Jersey into the RGGI. ⁶

In 2014, the RGGI cut allowances by 45 percent and would reduce the allowances by an additional 2.5 percent each year until 2020. ⁵

In 2017, then-Governor Ralph Northam (D) indicated that he wanted the State of Virginia to enter the RGGI. However, in 2019, Governor Northam refused to veto a bill prohibiting the state from joining the RGGI. ⁷

In 2020, the Virginia legislature overturned the bill’s provision and joined the RGGI. In 2022, the Virginia Air Pollution Control Board voted to leave the RGGI. ⁸ In 2023, the Southern Environmental Law Center filed a lawsuit against the board on behalf of the Association of Energy Conservation Professionals, Virginia Interfaith Power and Light, Appalachian Voices, and the Faith Alliance for Climate Solutions challenging the authority of the board to withdraw the state from the RGGI. ⁹ In 2026, Virginia Governor Abigail Spanberger (D) announced that rejoining the RGGI was a priority for her administration. ¹⁰

In 2022, Pennsylvania’s Environmental Quality Board voted to join the RGGI. However, it was noted in 2023 that Pennsylvania could not participate in the RGGI program while two lawsuits continued against the state. ¹¹ In 2023, the Pennsylvania Commonwealth Court ruled that it was unconstitutional for the state to participate in the RGGI. Governor Josh Shapiro (D) appealed the decision. ¹² In 2025, Governor Shapiro and Democratic legislators agreed to a withdrawal from the RGGI in the state’s budget process. ¹³

Activities

The Regional Greenhouse Gas Initiative oversees the Regional Greenhouse Gas Initiative program, which was a partnership involving ten states as of February 2026. The RGGI consists of CO2 Budget Trading Programs in each of the ten states, which sets limits on emissions of carbon dioxide emissions from electric power plants, issues carbon dioxide allowances (or credits), and establishes quarterly regional carbon dioxide allowance auctions. Energy companies in these states are permitted to maintain plants producing up to 24 megawatts using conventional fuels without purchasing allowances; emissions over 24 megawatts require the purchase and holding of enough credits for at least a three-year period. These allowances are issued by the states in auctions, and then can be acquired by companies at auction or on secondary markets. ¹⁴

The RGGI also sets a carbon production allowance cap across the ten states. In 2026, the cap amounted to 78,532,784 tons of carbon dioxide emissions. States can withhold a portion of their allowance allotment to be used at later dates when energy prices fall. ¹⁴

Impact and Criticism

Supporters of the Regional Greenhouse Gas Initiative have claimed that the program successfully pushes fossil fuel energy companies to invest in weather-dependent energy while cutting emissions and raising revenue for the state. Opponents have claimed that the RGGI has failed to achieve its stated goals while pushing increased energy costs on to consumers. ^{5 10 6}

In 2015, the environmentalist Acadia Center produced a report claiming that the RGGI had a substantial positive impact on the states in the program. The report claimed that compared to states not in the RGGI, states in the RGGI saw slower electricity price growth, 3.6 percent more economic growth, reduced CO2 emissions by 16 percent, and experienced a noticeable impact in resident health. ⁵

In 2018, the libertarian Cato Institute produced a report criticizing the RGGI for being ineffective in its goals, claiming that the Acadia Center’s report misunderstood the data. The report claimed the RGGI did not reduce carbon emissions, did not produce health benefits for citizens living in the affected states, had “minimal impact” on weather-dependent energy investment, and increased energy costs, leading to a “12 percent drop in goods production and a 34 percent drop in the production of energy-intensive goods.” The report attributes the drop in carbon emissions in the states primarily to non-RGGI market forces, such as improving solar and wind technology. The report also criticized the program for falsely representing itself as being a “market-based system” because the RGGI sets price controls on its carbon allowances. ⁵

Leadership

As of February 2026, the board of Regional Greenhouse Gas Initiative consisted of heads of the environment and energy departments of the States of Massachusetts, New York, Maryland, Rhode Island, Maine, Connecticut, and New Jersey. ¹⁵