By Liam McGowan
As the federal government continues to retreat from climate action, it is more important than ever that states work together to reduce air pollution, lower emissions, and address the climate crisis.
A standout example of just this sort of collaboration has been taking shape across the Northeast and Mid-Atlantic over the past two decades in the form of the Regional Greenhouse Gas Initiative (RGGI), a program that aims to achieve affordable and effective CO2 emissions reduction through 2037.
With new regulations recently put forward by the New York State Department of Environmental Conservation (DEC) and New York State Energy Research and Development Authority (NYSERDA), the RGGI is demonstrating how states can chart a different course from Washington.
“By strengthening the regulations – including an 85% reduction in the emissions cap over time, as well as more robust reporting, monitoring, and enforcement mechanisms – New York is helping ensure the RGGI will continue to deliver benefits for participating states in the coming years,” said NYLCV President Julie Tighe. “We applaud Governor Hochul, DEC, and NYSERDA for leading the way in this bipartisan, multi-state effort, and for their strong commitment to building an affordable, clean energy future for all.”
Formed in 2005, the RGGI is the first regional cap-and-invest initiative of its kind implemented in the United States within the power sector. The program mandates that major polluters within the specified region must pay an allowance dependent on how many tons of CO2 they release – the money is then invested back into the community through sustainable public transit and clean energy programs.
With seven states participating at its launch, the initiative has since grown to include eleven states including Connecticut, Delaware, Maine, Maryland, Massachusetts, New Hampshire, New Jersey, New York, Rhode Island, Vermont, and Virginia.
Each year, the RGGI sets a limit, or cap, on CO2 emissions and lowers that cap progressively over time. Fossil-fuel power plants with a capacity of 25 megawatts or greater are required to hold allowances equal to their CO2 emissions over a three-year control period.
Under the new regulations adopted in early August, starting in 2027 the regional cap on CO2 emissions will be 69.8 million tons per year. That number will then gradually decrease by 10.5% yearly until 2033, where it will decrease only 3% yearly until 2037. The slow ramp-down ensures a straightforward path and ambitious – yet achievable – goals for heavy polluters to limit emissions.
The new regulations also add an additional tier to the Cost Containment Reserve (CCR), which protects the program from cost fluctuations. When prices begin to spike and the market gets tight, the CCR releases extra allowances to provide a buffer and ensure the system remains stable in the long-term.
According to the DEC and NYSERDA, “the regulatory updates follow a multi-state program review decided by consensus to confirm the states’ long-term commitments to energy affordability, public health, and environmental protection.”
By lowering fossil fuel emissions output from major polluters, the RGGI improves air quality and reduces the harmful effects of pollution. This means fewer respiratory illnesses that can seriously affect at-risk groups, like people with heart disease, asthma, and other underlying health issues.
Additionally, preventing the buildup of CO2 in the atmosphere diminishes the harmful Greenhouse Gas Effect, which causes global warming and contributes to an increase in extreme weather, such as intense hurricanes, flash floods, and record-breaking heat. This is especially critical for Disadvantaged Communities, many of which lack the infrastructure and resources needed to withstand and efficiently recover from these weather events.
While the RGGI clears up the air we breathe and reduces harmful emissions, it also provides extensive economic benefits throughout the region. In New York alone, the program is currently generating roughly $700 million to $1.1 billion annually, with nearly $3 billion collected since the RGGI was established.
The funds generated through the program are allocated by NYSERDA, and the majority of the funds – around 60% – go directly towards advancing energy efficiency, saving significant amounts of money for consumers over time.
In 2023, for example, energy efficiency programs funded by the RGGI were “expected to return about $1.9 billion in lifetime energy bill savings to more than 181,000 participating households,” per RGGI’s 2023 Investment Report.
Other investments go toward clean and renewable energy (around 20% of funds), including the NY-Sun initiative, a program that uses tax incentives to make the installation of solar energy more affordable for New Yorkers.
A smaller portion of funds go towards Greenhouse Gas Abatement & Community Programs (5% of funds), which benefits New Yorkers by improving air quality and making energy efficient upgrades to aging buildings. One project in particular has “been designed to monitor air quality in 10 Disadvantaged Communities, home to approximately five million New Yorkers living in areas historically overburdened by environmental pollution,” according to NYSERDA.
The benefits of this regional program cannot be overstated. Since its launch, the RGGI has saved families billions of dollars in energy costs, substantially reduced pollution, and supported thousands of jobs while providing significant health benefits by cleaning up our air – and with New York’s leadership it’s only getting stronger.
It’s an approach we hope other states will replicate, centered on a fundamental truth: that air pollution and the impacts of climate change do not respect state borders, and therefore we must address these challenges collectively.
Want to learn more about the RGGI? Visit https://www.rggi.org/.
Liam McGowan has been a communications fellow at the New York League of Conservation Voters since November 2025, and intern since September 2025. He graduated from the University of Vermont in May 2025 with a B.S. in Environmental Science (Biology concentration). During his time at UVM he assisted with projects in the Rubenstein Ecosystem Science Laboratory. To learn more about Liam, visit his LinkedIn page located here.