Dear Friends and Neighbors,
Last week, Gov. Inslee and former U.S. Sen. and Secretary of State John Kerry visited the Legislature to lobby for the governor's carbon tax. I wanted to tell you about this proposal, share my opinion, and ask for your thoughts as well.
The governor's plan would tax carbon emissions generated by transportation fuels and power plants at $20 per metric ton (which has been amended to $12 per ton by a Senate committee) beginning in July 2019. The tax would increase by 3.5 percent, plus inflation, each year after that.
The proposal would raise approximately $1.5 billion per biennium in new taxes. This revenue would be deposited into a separate fund, most of which would be used to make “direct investments” in “clean energy technologies.”
Personally, I have several concerns with this proposal:
First, experts believe this would raise the cost of gasoline by about 20 cents per gallon, and the governor's own staff acknowledged consumers would see electricity and natural gas prices increase by 5-10 percent (plus future annual increases of 3.5 percent, plus inflation). These costs would represent a significant burden to working families.
Second, while the purported goal of a carbon tax is to make carbon pollution more expensive (thereby incentivizing businesses and individuals to reduce their carbon emissions), even proponents of this specific proposal have admitted that the anticipated increase in energy prices wouldn't be substantial enough to affect consumer behavior.
Third, I question the state's ability to wisely and prudently decide which “clean energy technologies” to make investments in and the amount of such investments. We've all seen the problems when the government attempts to pick winners and losers, and I believe the private sector is better-equipped to make investment decisions than the state.
In my opinion, a better approach is like the one outlined by House Bill 2283, proposed by my Republican colleague, Rep. Richard DeBolt, which passed out of the House Technology and Economic Development Committee with a strong, bipartisan vote of 13-4. That bill would establish tax incentives for businesses and utility companies who invest in renewable energy and carbon reduction. Rather than imposing mandates and new taxes, it reduces carbon by rewarding innovation.
I'd love to hear your thoughts on the proposal though. And if you have any questions on this issue or any others before the Legislature, please do not hesitate to contact me.