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Putting a Price on Carbon Pollution: Reducing Emissions Through the Market Place
As concern about human induced climate change mounts with each new storm, flood and drought, there is growing interest in available solutions that can work on a large scale to reduce emissions and support the transition to clean, renewable sources of energy. Pricing carbon to reflect its social cost (i.e., health and environmental impacts throughout the full life cycle of a product – costs typically not borne by the polluter) is a form of market-based environmental reform and is considered one of the most efficient and cost-effective means of reducing emissions.
Revenues raised through social-cost pricing of fossil-fuel based energy can be designed as largely or completely “revenue neutral” to offset higher fuel costs for businesses and individuals. Funds can also be reinvested in the economy to promote industry and job growth in the renewable energy sector.
LWVMA was one of the first organizations to support carbon pricing legislation introduced by former Representative Thomas Conroy and Senator Michael Barrett during the last legislative session and submitted written testimony on behalf of that bill.
LWVMA is once again supporting carbon pricing legislation introduced by Senator Barrett this year: S.1747, An Act Combatting Climate Change.
S.1747 is based on the highly successful carbon pricing system in place in British Columbia for the past six years, and a recent report from the Department of Energy Resources regarding the impact of carbon pricing in Massachusetts. The new bill is designed to be 100% revenue neutral.
While pricing carbon to reflect its true cost to society would have the greatest and fastest impact if enacted at a national and global level, action at the state level has often paved the way for action on a broader scale by providing working models and experience, as well as leadership. California, Oregon, Washington and British Columbia signed an accord in 2013 to coordinate their carbon emissions pricing systems where possible, opening the door to regional agreements. State level carbon pricing legislation is gaining momentum, with Oregon and Vermont joining Massachusetts to introduce carbon pricing legislation in the 2015-2017 legislative session.
How you can help
- Become informed about climate change and carbon pricing as a solution.
- Learn how human induced climate change impacts the country and the NE region to better understand the importance of reducing emissions.
- Learn how carbon pricing works in general.
- Learn how a carbon pricing approach impacts MA.
- Contact your state representatives in the House and Senate and urge them to support S.1747. State representatives want to hear from constituents and respond to issues based on volume of calls, emails and letters. Short, personal messages from voters have a real impact! See below for some talking points.
- Practice life-style changes that can help reduce your personal carbon footprint.
- There is strength in numbers. Join the LWVMA!
Talking points: Why LWVMA supports S.1747 An Act Combatting Climate Change and strong carbon pricing legislation
The threat from global warming: Climate change – also called climate disruption – is the greatest environmental threat facing the planet. It already has begun raising sea levels, causing droughts and floods to worsen, and making storms more intense.
Goal: cut climate pollution. Massachusetts state law requires that we cut greenhouse gas emissions (primarily carbon dioxide, or CO2) to 25% below 1990 levels by 2020 and to at least 80% below 1990 by 2050. This will require a dramatic shift from fossil fuels to clean energy such as solar and wind, while greatly improving the efficiency of our energy use.
How: add a carbon pollution charge to fossil fuel prices. Most economists, from conservative to liberal, agree that the most cost-effective way to cut carbon pollution is to add a charge that raises the prices of fossil fuels such as natural gas and gasoline (electricity generation would be exempt, because it is already covered by other programs). This would give energy producers and consumers a strong incentive to shift to clean energy – while having the freedom to decide how to do so.
Where would the revenue go? All the money would be returned to households, businesses, and institutions, so that living standards and competitiveness are protected. For the CO2 charges paid by people, each state resident would receive an equal share of the total money collected. For charges paid by businesses and other institutions, each would get a rebate in proportion to its share of total employment in Massachusetts. Additional rebates would be provided to households in areas where it is necessary to drive substantially more than average and to businesses that are energy-intensive and face stiff out-of-state competition.
Pollution will fall: the CO2 pollution that causes climate disruption would be cut by more than any single regulatory policy that the state operates now or is considering.
Households and businesses will be protected: modeling shows that we could give back to low- and moderate-income households at least as much money as they would pay in higher costs for fossil fuels. After getting rebates, almost all businesses would face quite small changes in their net costs, positive in some cases, negative in others.
Employment will rise: mainly because the Act would cause Massachusetts to spend billions of dollars less on importing fossil fuels, and instead spend more on in-state businesses, several thousand more jobs would be created due to the carbon charge.
The economy will benefit: there would be little overall impact on the state economy, with small gains in important measures such as average personal income and Gross State Product.
 Please note that as of this posting (April 7, 2015), Senate bills have not been assigned and bill language is not yet available to the general public.
LWVUS Local League Toolkit for Climate Change
The LWVUS Climate Change Task Force encourages League members to consider adopting a Climate Initiative as part of their local program at their annual meetings this year. There are two issue areas in particular where Leagues can make a real impact on greenhouse gas emissions — energy efficiency in buildings and renewable energy. The Grassroots Action Priorities section of the LWVUS Climate Action Toolkit includes detailed information about climate solutions. To share your League’s story, please send your answers to these questions to Task Force Chair, Eleanor Revelle (email@example.com).