Carbon fee supporters turn out in force
Opponents stay away, presumably because passage unlikely
SUPPORTERS OF A STATE-IMPOSED FEE on carbon emissions turned out in droves on Tuesday at a State House legislative hearing. No one, at least during the first few hours of testimony, spoke in opposition.
The legislation, filed by Sen. Michael Barrett of Lexington, would impose a fee on the sale of all carbon-based fuels. The fee would start at $10 per ton of carbon dioxide emissions and rise $5 each year until it reaches $40 a ton. The fee would apply to all carbon-based fuels except for those used in the generation of electricity, which is already subject to a regional carbon tax of sorts.
Barrett was careful to say his fee would be fully rebated to state residents so it technically would not qualify as a tax. Indeed, his legislation would dock the salaries of the governor and two of his cabinet secretaries if all of the proceeds from the fee are not returned to taxpayers.
The goal of a carbon fee is to price products that emit carbon in a way that accounts for their impact on the environment. In theory, putting a price on carbon emissions from gasoline and heating fuels should spur conservation and help promote clean energy alternatives. In British Columbia, which imposes a fee of $30 per ton of carbon dioxide emissions, the equivalent of 24 cents on a gallon of gasoline, emissions have fallen over the last several years without any negative fallout for the economy.
Under Barrett’s bill, all revenue generated by the carbon fee would flow into a special fund from which rebates would be paid to residents and businesses. Residents would receive a flat-fee rebate, while all businesses would receive a rebate based on their share of total state employment. Residents of rural communities would receive a slightly higher rebate because they tend to drive more.
Marc Breslow, co-director of Climate Xchange, a Concord organization pushing for carbon fees, estimated 60 percent of Massachusetts households would come out ahead and receive more money back than they pay out under the rebate plan, while the other 40 percent would end up paying roughly $120 more per year. Breslow said lower-income residents, who tend to spend less overall on energy, would tend to come out ahead. Breslow said many industries, including health care, would come out ahead, while some, including construction and trucking, would be net losers.
Scott Nystrom of Regional Economic Models Inc. in Amherst said economic projections indicate the carbon fee could be implemented in Massachusetts without negatively affecting the economy or job growth. In fact, he said, the fee could have a positive impact on the economy by curbing demand for carbon-based fuels coming from outside the region.The fact that no one spoke in opposition to the carbon fee at Tuesday’s hearing before the Legislature’s Committee on Telecommunications, Utilities, and Energy probably reflects a consensus on Beacon Hill that a carbon fee is unlikely to pass any time soon. Gov. Charlie Baker and House Speaker Robert DeLeo are both opposed to new taxes, and it’s unclear whether they would agree with Barrett’s interpretation that his carbon assessment is a fee and not a tax.
Asked at the hearing why no one was speaking in opposition to his bill, Barrett chuckled and said: “It’s a good question.”