LEAGUE OF WOMEN VOTERS OF MASSACHUSETTS May 16, 2015 Annual Convention. Presented by Launa Zimmaro Energy and Resource Conservation Specialist, LWVMA

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1 LEAGUE OF WOMEN VOTERS OF MASSACHUSETTS May 16, 2015 Annual Convention Presented by Launa Zimmaro Energy and Resource Conservation Specialist, LWVMA

2 Goals for this session General overview of carbon pricing Carbon pricing in Massachusetts Passing carbon pricing legislation

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4 Let the Market Fight Climate Change The answer to fighting climate change is actually fairly simple Biggest contributor to climate change is carbon dioxide emissions from fossil fuels. Typically there is no cost price for emitting all the carbon dioxide you want. Putting a price on carbon emissions will change that and put the market to work to reduce fossil fuel use.

5 Who supports a price on carbon? Public Officials across political spectrum Business Leaders Economists Scientific Organizations International Organizations

6 Pricing Carbon is not a new idea Figure from World Bank report,

7 What do we mean by Carbon? Greenhouse Gases Greenhouse Gas (GHG) Global Warming Potential (GWP) Contribution to Warming Primary Current Sources Carbon dioxide (CO 2 ) 1 63% Fossil fuel burning, land use, cement Methane (CH 4 ) 21 20% Fossil fuel production, agriculture Halocarbons ,000 12% Nitrous oxide (N 2 O) 310 5% Alternatives to ozone, various manufacturing uses Mostly agriculture, ~1/3 are anthropogenic Most warming is from CO 2. Can put a price on any or all of the gases. Equivalency of gases calculated using GWP. Called CO 2 equivalent (CO 2 e).

8 How Do You Price Carbon? Carbon Pricing Elements Pricing Mechanism (Carbon tax and/or Cap and Trade) Revenue Options (Revenue neutral and/or Government programs) Emissions Included (Electricity generation, Transportation, and/or Industrial)

9 Pricing Mechanism Emissions Cap and Trade Declining emissions cap set by government Price Price based on market Carbon Tax Emissions volume based on market Rising price set by government Both mechanisms have been tried; both have been successful.

10 Analysis of a Carbon Fee or Tax as a Mechanism to Reduce GHG Emissions in MA: Mass Department of Energy Resources (DOER), December 2014

11 Revenue Options Revenue Neutral Revenue returned to households and businesses, e.g. through taxes Many variations, e.g. flat fee to all, proportionate to income tax, targeted taxes like employment tax, etc. Government Programs Allocated by government for specified programs Mitigation and adaptation to climate change Infrastructure Basic research

12 Does putting a price on carbon work? British Columbia Carbon Tax Carbon tax (US$28/tCO 2 e), includes 70% of emissions. Reduced Greenhouse Gases (GHG) subject to the tax by 10% ( ). BC s real GDP growth (2009 to 2013) on a par with all Canada.

13 The 2014 Global Warming Solutions Act Energy and Climate Sco Why do we need a carbon fee? 2014 Global Warming Solutions Act Energy and Climate Scorecard

14 Will it hurt our economy? Models show it will help the economy Experience shows it will help the economy Action is much cheaper than inaction

15 An Act to Combat Climate Change: S.1747 Based on 2014 DOER study of impact of carbon pricing on MA economy, families, businesses 100% revenue neutral Gradually increases, $10/tCO 2 e to $40/tCO 2 e over 5 years Low and moderate households held harmless Equal rebates returned to every MA resident

16 Mass Department of Energy Resources: DOER 2014 report

17 An Act to Combat Climate Change: S.1747 Formula for employers based on number of employees Additional rebates for longer than average commute Additional rebates for energy-intensive businesses

18 The Massachusetts Campaign for a Clean Energy Future Growing and broad-based Funding from national foundations Working since last summer Preparing to launch late summer; website mid-summer

19 What You Can Do Check-off name on workshop list Check LWVMA.org Environment page for information Host carbon pricing presentation within your local League/community Contact with questions and comments Join the campaign to enact carbon pricing in MA!

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