A bill requiring polluters to pay for their greenhouse gas emissions seemed poised to clear the state’s Democrat-controlled Legislature this week. But as the measure headed to a vote in the northwest U.S. state’s Senate, Republican members left the state, leaving the chamber short of a quorum and grinding legislative business to a halt.
Putting a price on carbon pollution, as Oregon’s plan would do, is the climate change strategy economists swear by. Even Republican elder statesmen back it.
But the Oregon walkout is the latest demonstration that it can still be a tough sell politically.
Pay to pollute
After roughly two centuries of polluting for free, economists say fossil fuel industries should pay for the damage their greenhouse gases cause to the climate. And making carbon dioxide (CO2) emissions more expensive, they say, is the most efficient way to reduce them.
Oregon’s cap-and-trade proposal is one way to accomplish that.
The state would set a limit, or cap, on total CO2 emissions. Power plants, factories, refineries and other industries would have to buy allowances for each ton they produce.
That provides an incentive to emit less. And companies with allowances left over can trade them with those having a harder time reducing pollution.
Industries that have to buy carbon allowances would most likely pass the cost on to consumers.
One place consumers would most likely see that cost is at the gas pump. By some estimates, the program would raise fuel prices at least 16 cents per gallon in the first year and go up from there.
Critics say the cost would fall harder on rural residents, who tend to drive farther than city dwellers. And farmers would pay more to drive planting and harvesting equipment.
“We are against job-killing bills that will decimate rural Oregon, who many of my caucus members represent,” Senate Republican leader Herman Baertschiger Jr. said in a statement after the bill cleared the Oregon state House.
But studies have shown that rural areas fare better under cap-and-trade programs than urban areas do. One study found the relatively small losses fell more heavily on urban areas. Another found net gains from increased energy efficiency, with bigger benefits to rural residents.
Supporters say the bill’s writers were careful.
“There are tons of details that really speak to how tailored the policy became for specifics of Oregonians,” said Pam Kiely with the Environmental Defense Fund. “It’s not cut-and-paste.”
The bill includes measures to cushion the blow for some industries and residents.
A tax credit would help low-income people defray higher fuel costs. Part of the revenue from selling pollution allowances would be used to help them weatherize their homes, reducing their heating and cooling bills.
“We want to make sure this program doesn’t create an overall burden on low-income people,” said state Sen. Michael Dembrow, one of the bill’s Democratic backers.
Also, heavy-polluting industries that might leave the state and set up shop elsewhere would get a break on their emissions allowances.
Oregon’s state Senate Republicans are not sold.
When Democratic Gov. Kate Brown sent the state police to find the missing lawmakers and return them to the capital, Republican Sen. Brian Boquist responded, “Send bachelors and come heavily armed. I’m not going to be a political prisoner in the state of Oregon. It’s just that simple.”
Oregon is not the first state to struggle with the politics of pricing carbon.
New Jersey withdrew from the nation’s first cap-and-trade program under Republican Gov. Chris Christie in 2011. The state is now returning to the nine-state program under Democratic Gov. Phil Murphy.
This year, Virginia Democratic Gov. Ralph Northam’s administration issued rules to join the program, known as the Regional Greenhouse Gas Initiative. But the state’s Republican legislature blocked them.
It’s a global phenomenon.
Australia’s Labor government launched a carbon-pricing program in 2012. Two years later, a new conservative government repealed it.
Canada imposed a nationwide carbon tax this year under Liberal Prime Minister Justin Trudeau. Several Canadian provinces led by Conservatives are fighting it in court.
Meanwhile, in Oregon, legislative business is piling up as the June 30 end of the session nears. Brown has threatened to fine absent lawmakers $500 per day.