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Posted by Matt Pilon at Hartford Business on March 20, 2017
For the past decade, Democratic U.S. Rep. John Larson has regularly lobbied Congress to pass a nationwide tax on carbon emissions, something that had been supported by former Vice President Al Gore. But the tax, which Larson sees as a way to slow climate change and generate economic benefits, has never gained enough support in the face of political opposition. Now, lawmakers in Connecticut and two fellow New England states are trying to take matters into their own hands. Bills before Connecticut, Massachusetts and Rhode Island legislatures would create the first state-level carbon taxes in the country and they're garnering intense opposition from businesses, which say the levy would drive up the price of electricity, natural gas, heating oil, gasoline and propane. As written, Connecticut's proposed $15-per-ton tax on the carbon emitted by various fossil fuels could generate more than $500 million in the first year, based on 2014 emissions data. That figure could more than double by the fifth year, as the bill allows for annual $5-per-ton tax hikes. The tax, or fee as some advocates call it, would apply to electricity and natural gas suppliers, including utilities, and virtually every power plant in the state. It would also impact properties — including those owned by manufacturers, universities and hospitals — that have on-site gas-fired combined-heat-and-power plants. "This is a plan, a principle, whose time has come," said state Rep. Jonathan Steinberg (D-Westport), who is a key supporter of the carbon tax. "We are actually now in a position to capture the true costs of fossil fuels." Utilities, oil dealers, power plant owners and business groups all expressed concern last week about the bill's potential to increase energy prices in the state, which are already among the highest in the nation. However, advocates point out that the carbon-tax revenues would be returned to employers and residents in the form of "dividends," helping offset higher costs. Of the tax revenues collected, 70 percent would be redistributed to individuals and businesses through tax credits or direct checks, while 25 percent would fund energy-efficiency programs that incentivize property owners to adopt cleaner technologies. The remaining 5 percent would fund state administrative costs. The dividends would generate economic activity, tax proponents say, and reduce reliance on imported fuels, creating jobs in Connecticut. "We are now spending dollars on an import that supports employment elsewhere," Massachusetts Sen. Michael Barrett told lawmakers at the Capitol last week. "This will create disposable income in the pockets of local residents." A 2014 study by Regional Economic Models Inc. found that a Massachusetts carbon tax could add as many as 10,000 jobs by 2030, and that most households (particularly low-income) and business sectors could be fully reimbursed for the tax. Bigger energy users like construction and manufacturing firms would see a small loss. Meanwhile, the study calculated that a carbon tax would cut emissions by an additional 5 percent to 10 percent by 2040. Since 2009, Connecticut and eight other eastern states have lowered electricity-related carbon dioxide emissions through a cap-and-trade program called the Regional Greenhouse Gas Initiative (RGGI). A carbon tax, as proposed, would be added on top of costs utilities pay to RGGI. Some in the electricity industry argue that amounts to double taxation. But environmental groups say more decisive action is needed if Connecticut is going to keep its climate-change pledges. They say a carbon tax must be placed on all fossil fuels, not just electricity generation. Bill Dornbos, senior attorney and director of the Acadia Center's Connecticut office, an environmental advocacy group, testified last week that it's uncertain whether Connecticut can hit its next emissions milestone — a 10 percent reduction from 1990 levels by 2020. Uphill climb The carbon tax's road to approval is complicated. The Connecticut proposal hinges on both Massachusetts and Rhode Island enacting a tax of at least $10 per ton. Rhode Island's bill also contains a Massachusetts trigger clause. Several carbon-tax proposals have failed in Massachusetts since 2013. Several states have tried to implement a carbon tax, but none has succeeded (Washington voters turned down a tax last year). But the concept is not untested. Carbon taxes already exist in British Columbia, Alberta, the United Kingdom, France, Sweden, Finland, Ireland and other jurisdictions, according to the nonprofit Carbon Tax Center. Dan Esty, former commissioner of the state Department of Energy and Environmental Protection, appeared at a press conference last week to advocate for the carbon tax. Why does he think no U.S. state has taken the plunge? "The single most important thing I learned over my three years as [DEEP commissioner] is that change is really hard to bring about," Esty said. "And it takes a lot of work to get people focused on new options, even when they know the status quo isn't working." Business concerns The Connecticut Business and Industry Association (CBIA) strongly opposes the tax, going so far as to request that the Environment Committee suspend its rules and remove it from a public hearing agenda (which didn't happen) for fear that news of the proposal could damage the state's reputation and worry business stakeholders inside and outside of Connecticut. "What I worry about is Connecticut's continued focus … on this issue at a time when we're already the least competitive state with regard to energy costs in the country," said CBIA lobbyist Eric Brown. "I'm more worried about what signal this sends to the business community in Connecticut, one that is already strained." Brown also said he doubts actions by Connecticut or several states alone will be enough to address the planet's warming climate. State Sen. Ted Kennedy Jr., (D-Branford) co-chair of the Environment Committee, said concerns about energy costs are legitimate, but a carbon tax, which is gaining political momentum, is worth discussing. "This is not, I think, a [fringe] idea," Kennedy said. "There may be some merits to this and that's the reason for having a public hearing today." Kennedy noted that a group of Republicans, including former Secretary of State James Baker and former U.S. Treasury Secretary Henry Paulson, recently called on the Trump administration to pass a federal carbon tax. The so-called Climate Leadership Council, which says a carbon tax is a market-based solution to climate change, wants a $40-per-ton tax, with taxpayer dividends similar to those in Connecticut's proposal. "It can unite Democrats and Republicans, market-oriented people, and socially or community-oriented people," said Barrett, the Massachusetts lawmaker. "It's an approach that can fight climate change without creating the normal divisions we see." The Climate Leadership Council's timing may seem peculiar, given that President Donald Trump's Environmental Protection Agency Administrator Scott Pruitt has questioned climate-change science and, as governor of Oklahoma, sued the federal government over Obama's carbon-reducing Clean Power Plan. For some, the state bills reflect doubt that the Trump administration will consider taxing carbon. "The states are kind of where the action is on a lot of these issues in my view," Kennedy said. Congressman Larson said he doesn't think there will be a rush of Republican support anytime soon for a federal carbon tax. "[Republicans] are for the most part in denial about climate change," Larson said.
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Posted by Christine Stuart at CT News Junkie on March 13, 2017
HARTFORD, CT — It’s the first time Connecticut lawmakers are being asked to consider a carbon tax, but they’re not alone. State lawmakers from Massachusetts, Rhode Island, Vermont, and New Hampshire are looking at similar proposals to reduce carbon emissions. “It’s a first step for many of us,” Rep. Jonathan Steinberg, D-Westport, said. “This is something that possibly could wind up being a regional initiative.” The legislation would propose a fee of $15 a ton on carbon pollution that would be levied on petroleum products such as coal, oil, natural gas, propane or any other petroleum products. It would also be levied on electricity generators that use fossil fuels. The state would then redistribute the tax to residents and businesses, who according to proponents, would be inspired to lower their consumption as a result. Because a portion of the tax would be returned to homeowners and businesses, Steinberg said, those rebates would act as a protection to what’s been a temptation of lawmakers to sweep these types of accounts to close budget deficits. Connecticut’s legislation also includes a trigger which would require Massachusetts and Rhode Island to join us, Steinberg said. At a press conference outside the House chamber, Jeff Mauk, executive director of the National Caucus of Environmental Legislators, said lawmakers are introducing legislation to study carbon pricing in a number of states. “Signals being sent from Washington D.C. make it clear that it is up to the states to take the lead on climate action,” Mauk said. Rhode Island currently has a very similar proposal. “It truly is a win-win,” Rep. Aaron Regunberg of Rhode Island said. He said the reality is that New England is at the end of the supply chain and that’s not going to change any time soon without a carbon tax. If you want to transition to more local energy generation, “this is the most ambitious and effective way to make that transition,” Regunberg told the Environment Committee Monday. Most of the money from Connecticut’s carbon tax will be redistributed back to consumers. At least 25 percent will go to low-income residents to improve energy efficiency and 40 percent would be redistributed as direct dividends to Connecticut residents and 30 percent to Connecticut businesses. Washington State Sen. Kevin Ranker said the regional conversation in New England will “support a national conversation.” A national conversation that’s not likely to happen under a Trump administration. Last week, Scott Pruitt, Trump’s pick to head the Environmental Protection Agency, said during his confirmation hearing that he rejected the established science of climate change. “We’ve seen all the signs from Washington D.C. that this is not likely to be a national push,” Ranker said Monday. New England lawmakers who support the proposal said their regional support will encourage the middle of the country to join them. Ranker said there’s clearly an economic argument to be made. “On the west coast for instance, California, Oregon, Washington, and British Columbia make up the fifth largest economic driver in the world, so if that region does something it will move an economic argument for carbon pricing,” Ranker said. “That will become the norm.” He said the businesses will have to come along to meet those state standards, if all the states in a region are participating. “You can fight climate change in a market oriented way so as to not hurt consumers,” Massachusetts State Sen. Michael Barrett, D-Lexington, said. He said they are working on a way of getting consumers back rebates that would account for whether they live in rural communities and have different consumption needs than those who live in an apartment in Boston. The proposal was widely opposed by fuel companies. “There are many reasons that this proposed tax will cause economic harm to Connecticut, but if for no other reason, than the fact that low income residents who already spend a higher portion of their household budget on energy and gasoline,” Gregory Stafstrom, president of Spring Brook Ice & Fuel Service in New Britain, said. However, at least one company, NRG, supported the legislation. Dan Hendrick, director of external affairs from NRG, said as one of the largest generators in the state, mostly with fossil fuel resources, “we believe if the state wants to move forward with reducing carbon that this strategy is the right way forward.” He said it’s scope includes all fossil fuels, including gasoline and diesel. “Carbon, is carbon, is carbon, no matter where the resource comes from,” Hendrick said. He said because it’s not centered on any single resource or technology it’s more likely to withstand a legal challenge because “it doesn’t distort the wholesale markets.” https://www.facebook.com/CTNewsJunkie/videos/1273664526016532/ Posted by Tim Faulkner at ecoRI News on March 4, 2017
PROVIDENCE — Support is increasing for a carbon tax, but several business groups remain opposed to the concept. The fee on all Rhode Island gasoline, oil and natural gas promises to reduce carbon emissions, move the state from imported fossil fuel to locally produced renewable energy, and create jobs. The program is one of the priority bills for the Rhode Island environmental community this year, and it has a well-organized campaign and marketing plan led by the Energize Rhode Island coalition. A carbon-tax bill introduced last year died in committee, but this year the concept has the support of Gov. Gina Raimondo and the directors of the Rhode Island Department of Environmental Management (DEM) and the Office of Energy Resources (OER). Raimondo told ecoRI News she backs a carbon-pricing plan as long as other states in the region follow suit. This year’s legislation includes a “trigger clause” that activates a carbon-pricing program in Rhode Island when neighboring states such as Massachusetts enact their own carbon tax. Massachusetts introduced carbon tax bills in the Senate and House in January. The bills await hearings. Many of the same groups that opposed last year’s carbon tax bill came out against the legislation this year. Business organizations such as the Rhode Island Business Coalition and the Rhode Island Lumber and Building Materials Dealers Association said a fee on carbon imposes a financial burden on businesses that already pay some of the highest energy costs in the nation. “Adopting a carbon tax would clearly impact our economic competitiveness by driving up the costs of living and doing business in the state,” the Rhode Island Business Coalition wrote in a letter to the Senate Committee on the Environment and Agricuture. The Rhode Island Public Expenditures Council (RIPEC) also opposes a carbon tax. RIPEC executive director John Simmons stated in submitted testimony that the reduction in carbon emissions wouldn't be enough to curtail the impacts of climate change, “which is a global problem to which Rhode Island makes little contribution.” Proponents say a carbon tax helps the state economy by returning 70 percent of the tax revenue to residents and businesses in the form of a dividend. Thirty percent of the tax revenue, or about $30 million, would go into a fund to support local renewable-energy projects and energy-efficiency programs. They say economic growth would be realized as some of the nearly $4 billion the state currently spends on imported fuels is invested in projects that produce energy in the region. In addition to cutting carbon emissions and reducing airborne pollutants, the expansion of the renewable-energy sector and increased energy efficiency would reduce energy demand and save consumers money. In theory, a carbon-tax dividend shifts wealth to lower income groups. According to Energize Rhode Island projections, some 80 percent of residents would receive more money in their dividend than they would pay each year through the tax. Two Senate bills heard March 1 go about enacting the carbon tax in Rhode Island. Bill (S108), sponsored by Sen. William J. Conley Jr., D-East Providence, directs the state Executive Climate Change Coordinating Council (EC4) to conduct an analysis of a state and regional carbon fee. The bill also includes a request for an analysis of carbon pollution and children’s health. Conley noted that national conservative leaders have joined progressives in endorsing a carbon tax plan. And one such plan was featured in a recent New York Times op-ed. J. Timmons Roberts, a professor of environmental science at Brown University and a member of the EC4 science advisory committee, said carbon-cutting efforts must begin right away whether or not sea-level rise climbs 3 or 9 feet by 2100. “Our state’s economy and our quality of life is really at stake,” he said. Roberts noted that Rhode Island is sending money out of state annually to pay for fossil-fuel energy. “That money is just pouring through our fingers,” he said. Sen. Josh Miller, D-Cranston, remarked that some local businesses have benefited from renewable-energy incentive programs, which in turn have cut their electricity costs. Overall, he said state incentives have yet to make a meaningful reduction in carbon emissions. Therefore, more substantive actions such as a carbon tax are necessary to address the massive problem. “We’re not outliers on this issue and neither is this legislation,” Miller said. Brown University professor of oceanography Timothy Herbert said the planet's carbon dioxide concentration is at its highest level in 800,000 years. Herbert explained that he tells his students that carbon dioxide levels change more during their four years in college than during the 10,000 years before the Industrial Evolution. “As a scientist, if you assess the impacts of climate change seriously, then we have a really urgent need to have a comprehensive solution to greenhouse gases across the board,” he said. Providence residents Justin Boyan said he was compelled to speak out after seeing President Trump and his administration do the bidding of the fossil-fuel industry. He said he joined Resist Hate RI after Trump’s election. “I don’t see why global warming should be a partisan issue," he said. "It’s fundamentally conservative to me to conserve the planet for our kids." Boyan warned the politicians in the hearing room that there would be consequences for inaction. “If it (the bill) does die silently in committee, Resist Hate RI and a lot of other people are going to be paying attention and mad.” Climate emissions Prior to the hearing, Carol Grant, OER director, Janet Coit, director of DEM, and Danny Musher, chief of program development at OER, delivered an update on the state’s long-term greenhouse gas-reduction efforts. Coit reported that state infrastructure, fisheries and drinking-water supplies are already suffering from higher seas, warmer temperatures and an additional 10 inches of rain per year. “Climate change is here, it’s now, it’s pervasive in all of the issues we have to address,” she said. Musher said the state is on target to reach its 2020 greenhouse gas-reduction goals, but plans and programs must be adopted for drastic emission cuts in the state’s transportation and heating sectors — both of which must change in order to meet the 2030 and 2050 targets. “We can’t meet any of our goals unless we work with out neighboring states,” he said. “There is so much we can do at the state level, but it does require regional action, bold action,” Coit said. Some of those regional efforts are already helping to reduce emissions, such as the nine-state Regional Greenhouse Gas Initiative and the 11-state Transportation and Climate Initiative. “We have to face reality; we are not going to get help from Washington on this ... considering the present administration. That means action has to be taken at the state level,” said Dave Gerraughty of Energize Rhode Island. Both bills have the support of the Audubon Society of Rhode Island, the Rhode Island Association of Conservation Commissions, People’s Power & Light, R.I. Student Climate Coalition and more than 100 local businesses. The Senate bill were held for further study. A House bill sponsored by Rep. Aaron Regunberg is expected to have a hearing this month. |