What to know about Gov. Josh Shapiro’s ‘Lightning Plan’ for PA energy

During a news conference at Pittsburgh International Airport on Thursday, Gov. Josh Shapiro released a slate of energy policy proposals that he said will “spark our energy sector, create thousands of jobs and lower the cost for consumers.”

Shapiro's plan, which he is calling “The Lightning Plan,” includes a mix of previously introduced ideas – like his plan to cap carbon emissions from the electric generation sector and revise the state’s energy portfolio standards – as well as new efforts to create a state board dedicated to speeding up the buildout of energy-related projects and reforming a tax credit program created in 2022.

The release of Shapiro’s energy policy priorities comes just days before he delivers his annual budget address to state lawmakers on Tuesday, Feb. 4. Here’s what to know about Shapiro’s energy initiatives.

What would the ‘Lightning Plan’ strike? 

The six-part plan includes the Pennsylvania Climate Emissions Reduction Act, or PACER, which would see the state set caps on carbon emissions from its 50-plus power plants. Power plants would then have to purchase credits from the state to offset their emissions. That proposal was announced last year alongside the Pennsylvania Reliable Energy Sustainability Standard  (PRESS) initiative, which seeks to build on the state’s Alternative Energy Portfolio Standards Act – a law that requires electricity generators to generate a portion of their power from alternative energy sources. Shapiro’s office said the PRESS initiative would incentivize innovation in nuclear energy and renewable power.

Shapiro also said he would pull the state out of a regional effort to cap carbon emissions from the power sector – the Regional Greenhouse Gas Initiative – if lawmakers advance his PACER plan.

Shapiro also called on lawmakers to update the PA EDGE tax credit program passed by lawmakers in 2022. The program provided tax credits for hydrogen producers, milk processors and semiconductor manufacturers. Still, Shapiro said that the state has yet to award incentives through the program because the programs are “not flexible enough and not nimble enough to meet the needs of growing our energy sector.”

Shapiro’s 2025-26 budget calls for lawmakers to change the program to create tax credits for facilities that add reliable energy to the grid, regional hydrogen projects, and sustainable aviation fuel manufacturers. 

The other components of the governor’s plan include a “Community Energy” program that would allow rural communities, farmers and low-income communities to share energy resources, along with reforms to Act 129, a law that provides rebates to Pennsylvania consumers who buy energy-efficient appliances. Lastly, Shapiro’s plan calls for creating a Pennsylvania Reliable Energy Siting and Electric Transition, or RESET, Board tasked with speeding up permitting for energy-related projects. 

The proposals will likely be top of mind when Shapiro gives his budget address on Feb. 4. “Other states have put new policies in place that protect and create energy jobs, spur innovation, attract investment in data centers and EVs and much more – and they’re doing it all in a way that protects public health,” Shapiro said at the Jan. 30 press conference. “Pennsylvania, it’s time for us to be more competitive. It’s time for us to act.”

Lawmakers and industry groups react to Shapiro’s plan

The energy plan outlined by Shapiro quickly prompted responses from across the commonwealth, including from U.S. Rep. Chris Deluzio, who was on hand for the unveiling of Shapiro’s plan and expressed excitement about what it could accomplish. 

“We can grow our economy. We can keep energy costs down. We can have good, solid union jobs. We can protect our air and water,” he said. “It takes action like this plan. I’m excited to see it kick off. I will do everything I can to support it.”

Pennsylvania Senate Democratic Leader Jay Costa also praised the set of energy policy proposals, calling it a “bold, visionary plan for energy in Pennsylvania that uplifts our commonwealth from every angle, from energy production to consumer costs to grid reliability and beyond.”

Others celebrated some of the plan's components while expressing reservations. Pennsylvania Chamber of Business and Industry President and CEO Luke Bernstein said in a statement that the state “needs a comprehensive, all-of-the-above strategy that protects and expands job opportunities, drives economic growth and investment, and responsibly balances environmental considerations.

"The governor’s Lightning Plan includes important measures, such as tax incentives and permitting improvements, that can help attract private-sector investment – however, a carbon tax would undermine these efforts by discouraging reliable energy production, eliminating jobs, and driving up costs for families and businesses,” Bernstein added, referring to Shapiro’s plan to cap carbon emissions from the electric generation sector.

American Petroleum Institute Pennsylvania Executive Director Stephanie Catarino Wissman said the organization is reviewing Shapiro’s plan and “looks forward to working together to advance smart policies that can help usher in a new era of energy leadership and economic growth for Pennsylvania while helping to reduce inflation.”

Andrew Tubbs, president and CEO of the Energy Association of Pennsylvania, said Friday that the organization “supports efforts to keep Pennsylvania at the forefront of national energy leadership.”

“This can only be accomplished through sound energy policies that help maintain a healthy economy for Pennsylvania,” he added. “We look forward to collaborating with the governor, General Assembly, and stakeholders to craft a plan that addresses Pennsylvania’s current and future energy needs.”