Ballot initiative threat has energy industry warming to carbon tax

Ballot initiative threat has energy industry warming to carbon tax

Support for the governor’s proposed tax is tepid, but it’s there.

With environmental activists threatening a carbon tax ballot initiative, some manufacturing and energy companies are opting to work with lawmakers on Democratic Gov. Jay Inslee’s recently proposed tax rather than flat out oppose it.

On Jan. 9, Gov. Inslee rolled out a sweeping proposal to tax carbon emissions from power plants and transportation fuels at a rate of $20 per ton starting in July, 2019. The tax is estimated to raise $3.3 billion over three years, which would be reinvested in sustainable energy infrastructure, forestry, and assistance for low-income communities facing increased energy costs.

The proposal would exempt jet fuel, fossil fuels used in agriculture, and some energy-intensive manufacturing industries whose competitiveness could be undermined by increased energy costs. Gov. Inslee’s staff estimated that electricity prices will rise by 4 to 5 percent, natural gas by 9 to 11 percent, and 5 to 6 percent for gasoline.

Environmental groups including the Alliance for Jobs and Clean Energy have repeatedly threatened to push to get a carbon tax initiative on the 2018 November ballot if the legislature fails to pass Inslee’s proposal.

“If they can get it done well, great,” said Becky Kelley, president of the Washington Environmental Council and co-chair of the Alliance for Jobs and Clean Energy. “If not, it’s our job to be ready to go.”

“We have very real momentum for the simple reason that people realize that the legislative process allows for a healthy debate and dialogue,” said Sen. Reuven Carlyle, D–Seattle, who chairs the Senate Energy, Environment and Technology Committee and is the primary sponsor of Inslee’s carbon tax bill. “To govern by ballot initiative is inherently less flexible and is really a one-size-fits-all top-down approach.”

In 2016 environmental activists got a carbon initiative on the ballot, but voters ultimately rejected it by almost 20 points, with 59 percent against and 40 percent for.

At a state Senate Energy, Environment, and Technology Committee hearing on Jan. 16, representatives from the Washington business and energy communities expressed tepid support for the proposal given the threat of a ballot initiative, but argued that they want to see the tax rate reduced and the industry exemptions clarified.

“We absolutely prefer a legislative solution to this issue rather than an initiative,” said Charlie Brown, a lobbyist for Cascade Natural Gas and Northwest Natural Gas, before adding, “the tax at $20 per ton is a very steep tax.”

John Rothlin, representing the Avista Corporation—a Washington-based utility company—had a similar take. “Without legislation we know there are well-funded groups ready to pursue a ballot measure. We’re among those that believe that the best results will come from a collaborative effort here among people looking for fair and reasonable results,” he said.

“We think it’s appropriate that there be a modest tax rate and a pause at some point to ensure that it is meeting environmental objectives without making adverse economic impacts,” Rothlin added.

Steve Secrist, vice president at Puget Sound Energy, told the committee that he is “encouraged by current conversation,” and added that his company’s ultimate support must “take into account the impact to customer’s energy bills and how those customer investments translate into real carbon emission reductions.”

Representatives for Microsoft and other companies were enthusiastic about their support for Inslee’s proposal.

“It is clear that putting a price on carbon is one of the key pathways to reducing emissions and building economic, environmental, and social resilience,” said Perry England, co-chair of Washington Businesses for Climate Action. “It is not, it is not, a economy-crippling piece of legislation.”

However, several speakers were adamantly opposed to the bill, arguing that it would kill the competitive edge of their industries.

“Because we have concerns on the impact to our electrical customers, we are here today in opposition,” said Kathleen Collins of Pacific Power.

Sheri Call with the Washington Trucking Association said that the tax would place Washington-based trucking firms at at “competitive disadvantage.”

“Our initial analysis paints a stunning and painful picture about how we would be impacted,” said Bill Stauffacher of the Northwest Pulp and Paper Association. “In 2019 and 2020 this carbon tax would have a $56 million impact on our sector.”

While Sen. Carlyle said that he is “very sensitive” to the concerns listed by energy and business industry, he wouldn’t say whether the bill will be amended to lower the tax rate.

Senate Minority Leader Mark Schoesler, R–Ritzville, argued at a press conference on Jan. 16 that the companies appearing at the committee hearing on the tax aren’t representative of the entire Washington business and energy community. “I think it’s more important to talk about the companies that don’t get to come to the table,” he said. “Those that are too small and don’t have the right lobbyist are going to pay the price for not being the favored ones.”

Oil and petroleum interests were not present at the Jan. 16 hearing, but Sen. Carlyle said that there are lobbyists who are both adamantly against working with lawmakers and those who are engaged.

“There’s no question that there are some players in the oil industry who are arms crossed and feet up on the desk saying ‘hell no’,” he said. “But I can tell you that there are other players in the petroleum industry who are deeply engaged and are helping us.”

Sen. Carlyle said that he expects the carbon tax bill to get a vote in committee within the next two weeks.

This report was produced by the Olympia bureau of the Washington Newspaper Publishers Association.


In consideration of how we voice our opinions in the modern world, we’ve closed comments on our websites. We value the opinions of our readers and we encourage you to keep the conversation going.

Please feel free to share your story tips by emailing editor@bothell-reporter.com.

To share your opinion for publication, submit a letter through our website https://www.bothell-reporter.com/submit-letter/. Include your name, address and daytime phone number. (We’ll only publish your name and hometown.) We reserve the right to edit letters, but if you keep yours to 300 words or less, we won’t ask you to shorten it.

More in Northwest

Courtesy of the Washington State Department of Health
Inslee sets June 30 target for Washington to fully reopen

Meanwhile, fully vaccinated people can stop wearing masks in most places, the federal CDC said.

Matt Marshall, leader of the Washington Three Percenters gun rights group, addresses a crowd rallying for Second Amendment rights Jan. 17, 2020, at the state Capitol in Olympia. File photo
Open-carry of weapons now illegal at state Capitol, rallies

A new law bars people from carrying guns within 250 feet of a permitted demonstration.

Courtesy Photo, Kent School District
State Department of Health releases updated K-12 school guidance

Schools must plan to provide full time in-person education this fall

(Pixabay.com)
As rates of stoned drivers increase, law enforcement face challenges

WSP trooper said a THC breathalyzer would be a “game changer” for law enforcement and courts.

E. coli. Photo courtesy of the Food and Drug Administration
Seven King County children sickened with E. coli

Seven children in King County have been infected with E. coli, a… Continue reading

Sound Publishing file photo
Remi Frederick, a Village Green employee, receives her first dose of the Pfizer-BioNTech vaccine on Jan. 26 in Federal Way.
County health officer looks to community immunity instead of herd immunity

Herd immunity may be unlikely to reach King County anytime soon, but… Continue reading

Courtesy Photo, Public Health - Seattle & King County
Bat positive for rabies found in King County

Sammamish resident bit multiple times

The Moe Vegan food truck serves meals at the city of Kent’s annual Community Thanksgiving Dinner on Nov. 21, 2020. Sound Publishing file photo
King County fire marshals offer regulatory relief to food trucks

39 fire authorities have reportedly agreed to standardize fire codes and inspections.

Most Read