Posted by Mintaka Angell, February 25th, 2016.
What do Rhode Island and British Columbia have in common? Short answer: both have the foresight to pass legislation that protects both the environment and the economy. The only difference is that while Rhode Island has the opportunity to pass the bill in 2016, BC took the plunge eight years ago.
Luckily, that means that we can learn from BC’s example. In 2008, BC passed a fee on carbon that started at C$10 per ton and rose over four years to a modest C$30 per ton, totaling out to about an additional 7 cents per liter at the gas pump for Canadian citizens — offset by rebates and personal income tax cuts.
Eight years on, we have an excellent case study to examine the effects of such a fee on both the economy and the environment — and the results show a win-win for everyone. Environmentally, the personal consumption of fuel of BC citizens declined by 16%, while consumption in the rest of Canada rose by 3%, showing an undeniable example of how carbon fees prompt environmental stewardship. And this came not at the cost of the economy, but at its growth: BC’s GDP has outperformed the rest of Canada, with a growth of 1.75% from 2008-13, while the rest of Canada clocks in at about 1.28%. While critics may argue that its GDP may have grown even more without the fee, the results show at the very least the policy can coexist peacefully with an expanding economy. That’s not to mention the $5 billion in revenue that the tax has brought in, allowing for rebates in all sectors.
Of course, the Energize RI Act differs from BC’s carbon pricing scheme in a couple ways that will allow the Rhode Island bill to better serve Rhode Islanders. BC’s bill is revenue-neutral, meaning that the bill’s costs to citizens must be offset by cuts in other taxes. The Energize Rhode Island bill will instead put money back into the pockets of many Rhode Islanders through tax rebates, while using the rest of the funds to create a Clean Energy and Jobs fund that will build clean infrastructure to further secure Rhode Island’s economic and environmental future.
British Columbia showed the world that we don’t have to choose between the environment and the economy. A carbon fee is not a zero-sum game — and Rhode Island, like BC, stands to win on all fronts.