Photo by SounderBruce/Flickr

Photo by SounderBruce/Flickr

Ballot Initiative Threat Has Energy Industry Warming to Governor’s Carbon Tax Plan

Businesses fear a ballot-passed tax could be far costlier than a negotiated deal.

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 ballot this November 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 Washington business and energy communities expressed tepid support for Gov. Inslee’s proposal, 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.

news@seattleweekly.com


Talk to us

Please share your story tips by emailing editor@seattleweekly.com.

More in News & Comment

Photo of promotional recruitment banner used by Auburn Police Department at Petpalooza. The banner features Auburn Police Officer Jeff Nelson, who is awaiting trial for the 2019 murder and assault of Jesse Sarey. Photo courtesy of Jeff Trimble
Auburn police use photo of embattled officer on recruitment banner

Families of people killed by Jeffrey Nelson, who’s awaiting trial for murder, speak out over use of his photo at Petpalooza.

T
Use your King County library card to explore the outdoors

KCLS cardholders can check out a Discover Pass for two weeks to explore public lands.

Monkeypox virus. Photo courtesy of the Centers for Disease Control.
King County identifies first presumptive monkeypox case

The illness is not as easily transmitted compared to COVID-19, according to health officer.

This screenshot from Auburn Police Department bodycam footage shows an officer about to fire his weapon and kill dog on May 13, 2022.
Auburn police shoot dog, and owner claims it wasn’t justified

See videos of attack as well as bodycam footage of officer firing at dog.

File photo.
King County Council approves creation of Cannabis Safety Taskforce amid rash of dispensary robberies

The multi-agency task force will cooperate to find ways to improve safety in the cash-only industry.

Screenshot from ORCA website
New ORCA system launches for regional transit across the Puget Sound

Overhaul includes new website, mobile application and digital business account manager.

Judged by XII: A King County Local Dive podcast. The hands shown here belong to Auburn Police Officer Jeffrey Nelson, who has been charged with homicide in the 2019 death of Jesse Sarey.
JUDGED BY XII (Episode 4): Foster mom wants accountability in Auburn cop’s upcoming murder trial

Special podcast series explores Auburn Police Officer Jeffrey Nelson’s role in the death of Jesse Sarey.

Diane Renee Erdmann and Bernard Ross Hansen. Photos courtesy of FBI
FBI arrests Auburn couple after 11-day manhunt

The couple was previously convicted for fraud and skipped sentencing on April 29.

Screenshot from Barnes and Noble website
Cover art of books that KSD Librarian Gavin Downing says have been under fire: “Jack of Hearts (and Other Parts),” by Lev A.C. Rosen, “If I Was Your Girl,” by Meredith Russo, and “All Boys Aren’t Blue,” by George Matthew Johnson.
Kent middle school librarian wins intellectual freedom award

Gavin Downing refused to keep ‘silence in the library’ amid attempted book banning and censorship.

t
Kent elementary school teacher accused of using racist language toward student

River Ridge Elementary instructor placed on administrative leave by Kent School District.

FILE PHOTO: King County Sheriff’s Office deputies.
Dozens of King County Sheriff’s Office employees left jobs instead of getting vaccinated

This added on to the existing number of vacancies in the department.