Massachusetts pushes toward setting carbon price on cars

Source: Benjamin Storrow, E&E News reporter • Posted: Monday, July 23, 2018

Massachusetts climate advocates face a roadblock. Last month, the state Senate unanimously passed an energy bill that called for increasing the commonwealth’s renewable portfolio standard, eliminating its net metering cap and imposing an economywide carbon price.

But they now worry the Bay State could fall short of its climate goals after the state House of Representatives passed a series of limited energy measures last week. The House bills call for boosting energy storage and efficiency and envision a smaller increase in the renewable portfolio standard.

A state law requires Massachusetts to cut greenhouse gas emissions 25 percent below 1990 levels by 2020, with an 80 percent reduction by 2050. As of the state’s last counting in 2014, emissions had fallen 21 percent.

“I think we’re at risk of not meeting them,” said Deborah Donovan, Massachusetts director for the Acadia Center, a Boston-based environmental group. “It would mean we would have to do more faster in a shorter period of time, and that is going to be more expensive.”

The state Senate bill always faced an uphill climb in the more conservative House. Opponents of the legislation, which include Massachusetts’ largest trade group, argue that the commonwealth should take a break from energy legislation after enacting a law in 2016 aimed at buying large amounts of offshore wind and hydropower.

They also worry that increasing the state’s renewable portfolio standard could crowd hydropower out of New England’s wholesale electricity market. Massachusetts has increasingly turned its gaze toward Canada in recent years, in hopes of bringing more hydropower from Quebec into New England.

“We still advocate that this is a year for a breather,” said Robert Rio, senior vice president for government affairs at the Associated Industries of Massachusetts. “We are still in the midst of implementing the stuff in last year’s bill. Changing the goal post in the middle of the game can be unnerving. We don’t think any of that would calm the renewable markets.”

Greens say hydro interests have little to fear. They note that many of New England’s aging fossil fuel power plants are nearing retirement age. Hydro is well-placed to take their place, they say. And while hydro is ineligible for renewable energy credits under Massachusetts’ renewable portfolio standard, Canadian dams can still sell electricity in New England’s power market.

The state Senate bill would have increased the annual jump in Massachusetts’ renewable portfolio standard from 1 percentage point to 3 points. The House proposed a 2-point increase. The Senate bill also eliminated a cap on net metering for rooftop solar owners and limited the instances in which utilities could impose fixed charges on residential solar owners’ monthly bill.

The Senate legislation tried to move Massachusetts’ climate efforts beyond the power sector by instituting a carbon price for the transportation sector in 2020, the industrial sector in 2021 and the residential sector in 2022. The bill tasked the governor with determining how the price would be applied.

Transportation accounts for 39 percent of state greenhouse gas emissions, followed by the power sector at 20 percent and the residential sector at 18 percent.

Attention now turns to a conference committee, where House and Senate lawmakers will attempt to reconcile their legislation. The committee met for the first time yesterday.

State Rep. John Scibak, a Democrat, said he expected lawmakers to strike a deal, but noted they face a time crunch before the legislative session at the end of the month.

“It’s unclear in this case how much of this is horse trading,” Scibak said. “There seems to be growing interest and momentum in terms of the carbon tax.”

Gov. Charlie Baker (R) is a wild card. He supported the wind and hydro legislation enacted in 2016, but he has largely remained quiet this year. Katie Gronendyke, a Baker spokeswoman, said the governor would carefully review any legislation that reaches his desk.

Baker “looks forward to continued collaboration with the legislature to ensure a clean, affordable, and resilient energy future for the Commonwealth while progressing towards our greenhouse gas reduction requirements,” she said.

Environmentalists are optimistic. Even if the Legislature doesn’t move on carbon pricing, Baker is exploring a regional initiative to tackle transportation emissions through the Transportation and Climate Initiative. That effort figures to continue, regardless of what the Legislature does.

“We are hopeful that could be another avenue to address the transportation sector for us,” said Eric Wilkinson, director of energy policy at the Environmental League of Massachusetts.