The Legislature’s stop-and-start efforts to reduce carbon emissions need to produce better results. Greenhouse gas reduction targets passed in 2008 and adjusted in 2020 lack teeth. The state Supreme Court last year limited the governor’s power to mandate emissions cuts.
For all the state’s good intentions and environmental awareness, progress requires writing new law.
The soundly constructed cap-and-trade proposal in Senate Bill 5126 has potential to provide lasting environmental progress. Lead sponsor Sen. Reuven Carlyle, D-Seattle, calls the plan “cap and invest” because it would pump much-needed money into cleaner infrastructure. It provides an incentive for polluters to cut carbon emissions. Companies slow about cleaning up have to pay more. The proceeds go to reducing pollution with accountability — that’s where the “invest” comes in.
This savvy approach gives shrewd consideration to economic recovery. Utility companies working to meet existing clean-energy requirements aren’t affected until 2027. Trade-exposed heavy manufacturers including Boeing, Nucor and Alcoa are provided full carbon allowances until 2035, and a ramp to reductions after that. For other sectors, the bill sets out an ambitious path to reducing overall emissions, cutting them about 6% annually at the start.
That sensitivity to specific needs is one reason this bill has a chance where other carbon-emissions reduction proposals faltered. Many large employers are on board. Microsoft endorsed the proposal Thursday. BP America, whose Cherry Point refinery is among Washington’s largest carbon emitters, has advocated for state carbon pricing since 2019 and backs this bill.
Another is the well-calibrated leadership coming from the Legislature. Gov. Jay Inslee, author of a 2007 book on the perils of climate change, failed to persuade the Legislature to pass a cap-and-trade plan in his first term in 2015. Now Carlyle, Sen. Steve Hobbs, D-Lake Stevens, and others have repurposed cap-and-trade into the foundation of a so-called “grand bargain.” It would spend the cap-and-trade auction revenues to fight pollution, advance environmental justice and boost clean transportation infrastructure.
Cap-and-trade’s pivotal role would leverage the power of market forces to compel environmental progress — in the public and private sectors. Under SB 5126, Washington would set a maximum amount of emissions for the entire state, and reduce that cap each year until the state in 2050 has emissions that are 95% lower than the 1990 level.
Without new legislation, the carbon emissions reduction targets for 2030 and 2040, set by the 2020 Legislature, are little more than a nice idea. The proposed law would attach financial consequences if the targets are missed.
Polluters that emit more than 25,000 tons of carbon a year would have to bid each year for “allowances,” representing their shares of the state’s acceptable amount of emissions. According to the state’s 2019 pollution inventory, 123 facilities passed that threshold, ranging from the TransAlta Coal Plant in Centralia to a cattle feed producer in Moses Lake. Companies that cleaned up would have to buy fewer allowances. Stiff penalties would be assessed against any company emitting excess pollution, although companies could offset emissions beyond their cap by funding environment-improving projects within the state.
Carlyle said he drew on lessons learned from California’s cap-and-trade program, implemented in 2013. By 2019, that state’s emissions had fallen below 1990 levels — and gross domestic product had risen 30%.
“California has shown that you can grow your economy and reduce emissions,” Carlyle said in an interview. “But you can’t do it without strong investments in transportation.”
About 45% of Washington’s annual emissions result from transportation. The state can cut into this burden by converting the ferry fleet to electric power and building more charging stations near highways to make electric cars more practical statewide, as well as investing in transit.
The method has strong results elsewhere, too. The Regional Greenhouse Gas Initiative, a cap-and-trade program that links utility providers across 11 East Coast and Northeastern states, reported in 2018 that the year’s emissions were down by 47%, 70 million tons, from 2008, when the program started. The research firm Abt Associates found in 2017 that RGGI members’ pollution reductions led to $5.7 billion in public health benefits.
Washington’s cap-and-trade bill has the potential to compel similar reductions while also advancing necessary infrastructure and environmental justice. California learned some lessons hard. Heavy-polluting industries in lower-income neighborhoods bought a disproportionate share of allowances to emit. The bill’s proposed environmental justice protections would protect against such malignant outcomes inflicted on low-income communities by stepping up air monitoring and other measures.
Fulfilling these lofty promises cannot be left to blind faith.
As an element of this endorsement, The Seattle Times editorial board commits to providing frequent assessments of whether cap and trade is making legitimate progress. This legislation is estimated to extract more than $470 million per year from carbon polluters at its outset.
That is supposed to buy Washington not only emissions reduction and infrastructure improvement, but also meaningful progress toward environmental justice — all without incapacitating the economy. Under the bill, the state Department of Ecology could eventually link Washington’s emissions allowance auctions with the carbon marketplace California and Quebec share. Public vigilance is a must to evaluate whether that proposition is a good idea, if state leaders ever decide to push for it.
Ambitions are not enough. Good governance requires follow-through. The Legislature should pass this bill. The people should pay careful attention to whether its potential is fulfilled.