Washington governor unveils carbon
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[December 18, 2014]
By Rory Carroll
SAN FRANCISCO (Reuters) - Washington
Governor Jay Inslee on Wednesday laid out a plan for a carbon
cap-and-trade program aimed at fighting global warming and raising $1
billion a year for state schools and public transportation initiatives,
but he will first need the support of a divided state legislature.
The program would place an overall limit, or cap, on the amount of
carbon that large businesses and fuel distributors can emit. Those
companies would then have the option to either reduce their carbon
output, buy carbon permits at state-run auctions, or purchase
permits from other businesses on the open market.
However, the program faces an uphill battle politically since it
will need the state legislature to sign off on the proposal before
becoming law, including approval from the Republican-held state
The proposal in many ways mirrors California’s two-year-old
cap-and-trade program, which, like Washington, also aims to help the
state roll carbon emissions back to 1990 levels by 2020.
Inslee plans to introduce legislation early next year with an eye
toward launching the program in July 2016 and linking with the
California market at a later date.
Unlike California’s program, Washington would not give any carbon
permits for free to oil refineries, pulp and paper producers or
gasoline distributors, which account for 85 percent of the state’s
Businesses will instead be required to purchase permits at the
outset of the program. Permits are expected to be priced at around
$12 a metric tonne in 2016, Inslee officials said.
The cap-and-trade proposal is just one part of a suite of policies
Inslee said he would spearhead next year to slash emissions and
raise money to plug the state’s budget gap.
He also plans to push forward with a low-carbon fuel standard
(LCFS), a program that requires fuel producers to gradually reduce
the carbon content of transportation fuels they produce.
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LCFS programs are also controversial. California's LCFS has been the
target of lawsuits by out-of-state fuel producers, who claim it
unfairly targets their products.
In a speech on Wednesday, Inslee warned that there would be
“alarmist attacks” directed at his plan.
“Corporate polluters have launched aggressive campaigns against
similar efforts in other states and have already begun to do the
same here in Washington,” he said.
On Wednesday the Washington Consumers for Sound Fuel Policy, which
represents oil producers and other business groups, called Inslee’s
plan a $1 billion “hidden tax” on Washington fuel consumers.
(Reporting by Rory Carroll; Editing by Diane Craft)
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