Oregon Governor John Kitzhaber and Washington Governor Jay Inslee set ambitious goals when they signed a regional climate change agreement last week with the leaders of California and British Columbia.
But the governors can't reach those goals without their state legislatures, and both governors face legislative roadblocks to upholding the agreement – particularly when it comes to putting a price or a cap on carbon emissions.
One of the biggest promises Kitzhaber and Inslee made last week was to join California and British Columbia in accounting for the costs of carbon pollution in their states.
California already has a cap on carbon emissions from power plants and industrial facilities, and British Columbia charges a tax on fuels that emit carbon pollution.
Kitzhaber agreed that Oregon will "build on existing programs to set a price on carbon," and Inslee agreed that Washington will "set binding limits on carbon emissions." So, what happens now?
According to Kitzhaber's energy policy adviser Margi Hoffmann, there's really one existing program the governor wants to expand to set a price on carbon in Oregon. It's the low-carbon fuel standard – a program that would limit the carbon emissions coming from fuel burned by cars and trucks and spur the use of cleaner fuels such as cellulosic ethanol and biodiesel.
"I think when we talk about pricing carbon, people automatically jump to the question of whether we're talking about a cap and trade or a carbon tax," Hoffmann said, noting that Oregon also has a program that requires utilities to consider the possible costs of a carbon tax when choosing what sources of electricity they will use in the future. "Pricing carbon doesn't necessarily mean taxing carbon or cap and trade. We think of it more broadly than that."
The low-carbon fuel standard, or Clean Fuels Program was ordered by the 2009 Legislature, but it’s still in its first phase. Fuel suppliers will start reporting their fuels' carbon emission levels next year, and they won't be held to any limits until the second phase kicks in. But the program is scheduled to sunset, or expire, in 2015. That means it won’t get to the point of limiting carbon emissions unless the Legislature votes to keep it going.
"We want to make sure we're sending a long-term price signal to the market," Hoffmann said. "That's why we're working with the Legislature to try to lift the sunset – so we can have a long-term trajectory towards building out a robust alternative fuel infrastructure."
Here's the rub: Oregon lawmakers tried to pass a bill to lift the sunset earlier this year, and it failed.
Meanwhile, the ranks of the business organizations lined up against the program are growing. According to Roy Kaufmann, spokesman for the opposition group , several prominent industries have joined the opposition this year because they're concerned the carbon limitation will drive up fuel costs: The Oregon Dairy Farmers Association, Oregon Refuse and Recycling Association, Northwest Grocery Association, Oregon Home Builders Association and Oregon Restaurant and Lodging Association.
"For anybody paying attention to Oregon politics, those are very significant organizations that have members in arguably every district in the state and have contact with every legislator," Kaufmann said. He expects the issue will come up again in the next legislative session, but he doesn't expect the outcome to change.
"Looking at the makeup of the Legislature this year and the makeup of the Legislature in the 2014 short session, we don't see any signs that the conversation is going to go any differently this session," he said.
In Washington, Inslee would also need a vote from state lawmakers to put a limit on the total amount of carbon pollution coming from power plants and manufacturers. And the Legislature hasn't gotten to the point of voting on the idea.
Earlier this year, state lawmakers agreed to study the costs associated with a variety of strategies for reducing greenhouse gas emissions. They hired a consultant and organized a legislative work group to review the findings and recommend the best carbon reduction option.
Republican Senator Doug Ericksen sits on that legislative work group. He said he's concerned that Inslee spoke too soon in committing to a putting a cap on carbon before the work group has completed its review and made its recommendations.
"We're working on a process in Washington state, and to work forward through that process, we need to put the numbers associated with the programs," Ericksen said. "I think it would be premature to say we're going to advance one program over another or advance any of these programs right now until we have the results done. The people of Washington state, the taxpayers, are investing more than $1 million in this process, and I think we should work it through to get some understanding."
Greg Small is the director of the environmental advocacy group Climate Solutions. He said the fact that Washington got to the point of studying carbon reduction options is encouraging, but the reality is that the Republicans who control the state senate have not been supportive of taking action on climate change.
He said he hopes that Inslee and Kitzhaber will live up to their goals for capping and pricing carbon, but it won't be easy.
"The big challenge is whether some of these efforts which do need to go through the Legislature can actually pass through the Legislature, and we know that right now the answer is no," he said.
Small said he's looking forward to the 2014 elections to see how a new mix of lawmakers might change the outlook for new climate policies.
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