Carbon Pricing Reality
Wednesday, April 28, 2021
CARBON PRICING REALITY: As their session ended last week, the Washington Legislature closed the circle on their climate initiatives in a powerful way, passing an historic Clean Fuels Standard in tandem with their Climate Commitment Act.
The Climate Commitment Act creates a “cap-and-invest” program that limits and reduces greenhouse gas emissions from the largest greenhouse gas emitters in the state, and invests in programs and projects to reduce emissions, expand clean transportation, improve climate resiliency and reduce air pollution in overburdened communities. The transportation sector is the largest source of carbon pollution in the state and until now the Legislature had yet to take significant action to cut greenhouse gas emissions from that sector.
The clean fuel standard requires the reduction of carbon emissions from transportation fuels by expanding use of electric vehicles and lower-carbon fuels, including biofuels. The standard requires fuel producers to sell a cleaner product or invest in clean, low-carbon choices like electricity and local, sustainable biofuels to power transportation. The standard creates market certainty and is expected to increase the development of renewable and low-carbon fuels throughout the state. Importantly, the bill as passed places a hard cap on carbon pollution, establishes an air quality regulatory program, and directs investments to communities such that may be overburdened by cap-and-trade pollution swaps.
A third climate bill requires reductions in hydro-fluorocarbons that are a growing source in Washington of especially potent greenhouse gases.
Only one other state has passed a carbon cap, and just a few states are currently trying to price carbon pollution.
“The Climate Commitment Act caps and reduces climate pollution across our economy and enacts arguably the strongest environmental justice policy in the nation, obligating us to improve air quality for overburdened communities that live daily with air pollution from emissions,” Gov. Jay Inslee explained in support of the effort. “We now have a clean fuel standard as well, making our air cleaner and giving consumers more choice at the pump. These policies also create good, local jobs and better position our state to lead in a cleaner and more just economy.
“Lawmakers also took historic action on environmental justice when they passed SB 5141, the HEAL Act,” Inslee said at the close of the legislative session. “The bill will embed environmental justice considerations in agency decision-making, including climate policies and programs. This will help to reduce the environmental health disparities experienced in Washington’s most vulnerable communities by targeting additional investments to clean up these communities and by ensuring more inclusive engagement of frontline communities.”
“The Climate Commitment Act sets a new gold standard for other states across the nation to follow by tackling both carbon pollution and air pollution,” Katelyn Roedner Sutter, senior manager for U.S. Climate, Environmental Defense Fund, said. “This landmark bill would slash emissions at the pace and scale necessary to curb the worst impacts of climate change, while driving down damaging air pollution that disproportionately burdens many low-income communities and communities of color. The race to beat the climate crisis demands urgent action to cut emissions at every level. As the Biden administration reasserts climate leadership on the global stage, Washington state’s leaders are matching that ambition with bold policy that drives real, immediate progress.”
The bills, which passed without Republican support, were widely praised by the environmental community, which has been torn in recent years by debate about the merits of cap-and-trade, which alone does little to reduce the net amount of carbon pollution, and a more direct approach to drive down that amount.
“We are thrilled that Washington has fulfilled a crucial goal of the Pacific Coast Collaborative and established a clean fuel coastline that extends from California through Oregon, Washington, and British Columbia,” Graham Noyes, executive director of the Low Carbon Fuels Coalition, said.
Transportation contributes to nearly 45 percent of the state’s Washington’s CO2 emissions, and solutions require decoupling transportation initiatives from reliance on fossil fuels.
Once these bills are signed into law, state agencies will begin work to bring Washington into the West Coast group of Clean Fuel Programs in California, Oregon, and British Columbia. These states have already proven this program works: Oregon doubled its standard last year, and New Mexico and New York are also considering similar policies.
“The Legislature listened to our broad coalition of environmental organizations, forward-thinking businesses, workers, health professionals, community groups, and local governments, and thousands of people spoke up and demanded action on this critical climate and health policy year after year,” Leah Missik, campaign manager for the Clean Fuels Now coalition, said. “Now we can all literally breathe more easily as we move on and continue to work for climate justice and transition to a clean energy economy.”
“The Legislature wrapped up an historic and truly extraordinary session,” Inslee agreed. It has been the most innovative, having produced unprecedented and legacy making advances as all-encompassing as any session in the last 25 years. “Washingtonians received progress on climate, progress on equity, progress on our tax system, and progress protecting our workers and families, and more. And all of this was accomplished safely as the COVID-19 pandemic continues.”
Years in the making, it is a remarkable achievement.