June 23, 2023
Pennsylvania Energy Policy: Boom or Bust
For the third installment of the House Republican Policy Committee’s hearings on the Commonwealth’s energy policy concerns were raised about Governor Shapiro's continued insistence on the enaction of RGGI and its consequences for the future of Pennsylvania's energy sector. The closure of the Homer City Coal-Fired Generating Plant, entirely due to bad energy policy and the looming energy tax, took center stage in the discussion, drawing attention to the wider implications for the region's energy reliability and financial well-being.
Host of the day’s hearing, Representative Struzzi, invited a diverse panel of local community members and industry experts to share their perspectives on the proposed energy policy and its impact on the state.
The testifiers that joined the Policy Committee were as follows:
Powering Our Communities Panel
Gregg Kalemba - Business Manager, Homer Center School District
Jud Kroh - President, Robindale Energy
Shawn Steffee - Business Agent, Executive Board Trustee, Boilermakers Local 154
Powering Our Future Panel
David T. Stevenson - Director, Center for Energy & Environmental Policy, Caesar Rodney Institute
Nick Cohen - President and CEO, Doral Renewables, LLC
Greg Kalemba, the Business Manager of Homer Center School District, began the day’s hearing through sharing the dramatic impact bad energy policy incurs on the Homer City Community and schoolchildren. The importance of maintaining the Homer City Generating Station for the district's tax base cannot be disregarded, as it is a stable and secure means of supporting the district’s finances and school resources. With the plant contributing a significant $720,000 in annual real estate tax revenue, any closure would lead to a staggering 14% tax increase on residents to fill the revenue gap. The preservation of our energy generators is directly related to our school district’s ability to provide an education for children throughout the state. Mr. Kalemba’s testimony highlighted how the energy policy's consequences extend beyond the energy sector, impacting local communities and their financial stability.
“We are going to encounter a great financial loss with the Homer City Generating Station closing.”
Greg Kalemba
Business Manager, Homer Center School District |
Jud Kroh, President of Robindale Energy, highlighted the significance of the existing tried-and-true energy sector within Pennsylvania. He emphasized that the state ranks as the 11th largest energy producer globally, essentially producing the energy of an entire country all within the borders of the state. While, in the last decade, coal-fired generation has transitioned to cleaner gas-fired alternatives, Robindale Energy has been instrumental in reclaiming land and repurposing waste coal to continue the utility of existing coal-fired generators. By utilizing what was once considered a waste product Robindale Energy is contributing to the state's environmental efforts, cleaning up old industrial sites, and powering our communities. However, the introduction of an energy tax threatens the economic viability of their waste coal operations and risks pushing these jobs out of state borders and allowing mountains of energy-rich waste coal to remain unused. Mr. Kroh’s testimony underlined the importance of recognizing and supporting innovative approaches within the traditional energy sector to ensure sustainability, preserve local jobs, revitalize our environment, and keep our lights on.
“RGGI is a concern to us. Not just for our local businesses, but for grid reliability and economic issues.”
Jud Kroh
President, Robindale Energy |
Shawn Steffee, representing Boilermakers Local 154, expressed concerns about the decline in construction of coal and gas-fired power plants following the introduction of the energy tax. In the last few years, the construction of new gas and coal-fired generating plants has nearly ceased due to the looming threat of an energy tax. So, even with the tax not yet in effect, the negative impact on new construction and industry growth has been startling to PA trade workers.
Mr. Steffee argued that "green" jobs are not comparable to the family-sustaining careers provided by the traditional energy sector. Existing energy generators are built and maintained by highly skilled laborers throughout Pennsylvania, and the construction and maintenance of these facilities support entire families and communities that are happy to stay in their communities and continue their trades. Additionally, the exodus of skilled labor to neighboring states like Ohio and West Virginia highlights the adverse effects of current state policies on Pennsylvania's job opportunities. If poor energy policy decisions and energy taxes continue to take root in PA our workforce will have no other option than to find opportunity elsewhere. Mr. Steffee’s testimony emphasized the need to protect and promote the skilled workforce that has long been the backbone of the state's energy industry.
“The position of the Boilermakers is that this catastrophe is completely avoidable!”
Shawn Steffee
Business Agent, Executive Board Trustee, Boilermakers Local 154 |
David T. Stevenson, Director of the Center for Energy and Environmental Policy at the Caesar Rodney Institute, began the “Powering Our Future” panel by expression extreme caution regarding the adverse impact of the energy tax on Pennsylvania's energy competitiveness. He stressed that PA holds significant influence within the PJM grid and should exercise its power wisely to protect its interests from being exploited by other states. As the chief energy generator within PJM the Commonwealth must assert its power and address other state’s poor energy policies, such as subsidizing “alternative” energies, that risk PA industries and the future reliability of our regional electric grid. Mr. Stevenson’s testimony highlighted the importance of considering the broader implications of state energy policies on energy markets and grid stability.
“We don’t want to go backwards. We got where we are thanks to affordable and reliable electricity.”
David T. Stevenson
Director, Center for Energy and Environmental Policy, Caesar Rodney Institute |
Nick Cohen, President and CEO of Doral Renewables, LLC, acknowledged the potential for renewable energy sources to create job opportunities in rural Pennsylvania. “Alternative” energies should certainly be investigated, but we are not yet ready to risk the reliability of our grid on intermittent weather or unproven technologies. Doral Renewables is working hard to expand solar energy throughout PA, but Mr. Cohen was honest about the current potential of “alternative” energy. He emphasized that renewables are not yet capable of replacing existing generators, but can still be used to support the grid alongside natural gas, coal, and nuclear generators. Furthermore, though state and federal funding has been offered to support the use of hydrogen-derived energy, we are still a decade away from seeing any real-world incorporation of hydrogen power within our electric generation fleet.
Mr. Cohen stated bluntly that an energy tax would compromise the state's competitive advantage and potentially lead to further job losses. Though the proposed energy tax would not impact solar energy generators directly the loss of skilled tradesmen to other states and an unreliable grid without baseload support does not enable Doral Renewables to expand in a manner that is both best for the durability of our grid or the needs of Pennsylvanians. Mr. Cohen’s testimony underscored the significance of supporting and incentivizing a diverse energy portfolio while also acknowledging the current limitations of these emerging technologies.
“The best thing a state can do is stay out of the way of business and trust the free market.”
Nick Cohen
President and CEO, Doral Renewables, LLC |
Throughout the hearing, the critical need for a stable and reliable energy grid was highlighted as a paramount concern for the state, as was the recognition of the family-sustaining jobs associated with Pennsylvania's energy generators and resource extractors. The closure of the Homer City Generating Plant exemplifies how poor energy policy can lead to adverse consequences, forcing energy users to pay more for a less reliable product and local communities to struggle through unnecessary hardship.
The hearing concluded with a call for thoughtful and strategic energy policies that not only support all energy growth but also safeguard existing jobs and the overall stability of Pennsylvania's energy sector. A balanced approach that considers the economic impact on communities, supports innovation in traditional energy sources, and ensures grid reliability is essential to ensure a prosperous energy future for the Keystone State.