Carbon Pricing Gets Push After TCI’s Demise

By Matt Murphy, State House News Service

Pricing Bills Weighed As Mass. Reassesses Clean Energy Strategies

BOSTON, DEC. 14, 2021 – Undeterred by the collapse of a multi-state compact to cap and tax emissions from cars and trucks, advocates for putting a price on carbon to drive down pollution continue to see the strategy as essential for Massachusetts to meet its emission reduction goals.

But even supporters of carbon pricing don't always see eye to eye on how best to spend the money that would be generated.

The Joint Committee on Telecommunications, Utilities and Energy held a hearing Tuesday on a raft of bills focused on decarbonization of the economy, including legislation that would speed up the state's transition to renewable energy. Carbon pricing, supporters of the policy said, would not only help change behavior but generate the money Massachusetts needs to meet its requirement of net-zero emissions by 2050.

Rep. William Driscoll's bill, known as "The Green Future Act" (H 3292), would establish a market-based carbon pricing system to apply to the transportation sector, as well as homes and commercial buildings. It would generate an estimated $10 billion by 2030, with 24 percent, or about $1.4 billion, getting returned to consumers through rebates to offset the added cost of motor vehicle and home heating fuel.

Driscoll said rebates would offset new household expenses for the bottom 40 percent of earners in the state, with the remainder of the money invested in state and municipal infrastructure projects and workforce development. The bill would also create a $500 million "green bonding" program.

"We're looking at this as a way to meet new climate goals, create new jobs and to invest in our environmental justice communities," Driscoll said.

However, Sen. Michael Barrett, the chair of the committee and the sponsor of his own carbon pricing proposal (S 2133), questioned whether the rebate program in the bill was large enough.

"I for one am concerned about the impact on the middle class only rebating 24 percent," Barrett said. "I believe we need a carbon levy on fossil fuels but isn't it wise to consider rebating all the money to the middle class we have taken it from?"

Barrett said his bill would be revenue neutral, with 100 percent of the money generated from carbon fees getting returned to consumers. The Lexington Democrat said his research has suggested this would be enough to offset the added costs on 60 percent of households.

Robert Triest, a Northeastern University economics professor who called carbon pricing "an essential step in mitigating climate change," said the expenditures proposed in Driscoll's bill would also benefit the middle class by expanding the use the technologies that will drive down heating costs.

Gov. Charlie Baker signed the law committing Massachusetts to achieving net-zero emission by 2050 in March, but since then the governor was forced into pulling the plug on a multi-state cap-and-trade program known as the Transportation Climate Initiative (TCI) as political support in other states eroded. The program would have generated hundreds of millions of dollars for Massachusetts to invest in things like electric vehicles, but it also would have added to the price of gasoline.

"We do need to sustainably and equitably raise some amount of funds over the next decade," said Tim Cronin, state director for Climate Xchange.

Cindy Luppi, New England director for Clean Water Action, said it's "tempting" to look at the money Massachusetts stands to receive from the federal infrastructure bill passed by Congress and think that will be enough.

"Another inconvenient truth is we have decades of work ahead of us and one-time funding pots, unfortunately, will not get the job done," she said. The committee also heard testimony on bills related to expanding rebates for electric vehicles, net-zero building codes, heat pumps, and accelerating the timeline to achieve net-zero emissions by two-decades, just nine months after lawmakers first established the target.

Reps. Marjorie Decker and Sean Garballey and former state Sen. Joseph Boncore filed bills (H. 3288 / S. 2136) that would transition Massachusetts to 100 percent clean electricity by 2035 and 100 percent clean heating and transportation by 2045, while Sen. Jamie Eldridge and Rep. Erika Uyterhoeven sponsored legislation (H3372/S2170) that would move Massachusetts toward 100 percent renewable electricity and net-zero carbon emissions across all sectors of the economy by 2030.

Eldridge said his bill would also mandate additional offshore wind and solar power procurements, and invest in electric-vehicle charging stations and other infrastructure.

"I don't have to tell anyone here about the urgency of continuing to take bold climate action here in the commonwealth," Eldridge said.

While there is plenty of energy within the Legislature in favor of renewable energy, making the actual transition is proving more difficult. In addition to the demise of TCI, voters in Maine have rejected a transmission project Massachusetts has been counting on to bring hydropower down from Canada and offshore wind projects, while slowly advancing, have yet to begin churning out power.

-END- 12/14/2021