House Committee Votes in Favor of Cap and Trade Bill

AGC is opposing cap and trade legislation requested by Governor Gregoire. The bill HB 1819 was recently voted out of the House Committee on Ecology and Parks.

HB 1819 and the Senate version SB 5735 would implement a regional cap and trade program linking Washington with other states and Canadian provinces as part of the Western Climate Initiative (WCI).

The goal of WCI is to create a cap-and-trade program that would reduce greenhouse gas emissions within the region by 15 percent below 2005 levels by 2020. Each member jurisdiction committed to set its own reduction requirements to meet at least its proportionate share. In 2008 Washington committed to reduce its emissions to 1990 levels by 2020 by 25 percent below 1990 levels by 2035 and by 50 percent below 1990 by 2050.

According to the legislation an authority sets a limit or cap on the amount of a pollutant that can be emitted. Companies or other groups are issued emission permits and are required to hold an equivalent number of allowances or credits which represent the right to emit a specific amount. The total amount of allowances and credits cannot exceed the cap limiting total emissions to that level. Companies that need to increase their emission allowance must buy credits from those who pollute less. The transfer of allowances is referred to as a trade.

AGC believes the legislation would add significant costs to employers at a time when many are struggling. Plus the legislation is far-reaching in scope but very short on implementation details.

The bills leave many of the important decisions up to the Department of Ecology said AGC Legislative Counsel Van Collins. There are many unanswered questions about allocations offsets and how it will all work. It gives the Department of Ecology not the Legislature control over economic prosperity.

HB 1819 is sponsored by Representatives Upthegrove Dunshee Dickerson McCoy Rolfes Eddy Hunt White Appleton Carlyle Darneille Kagi Pedersen Conway Sells Nelson Chase Ormsby Kenney and Williams.

The Senate version SB 5735 has been heard in the Committee on Environment Water and Energy. It is sponsored by Senators Rockefeller Hargrove Jacobsen Ranker Fraser Keiser Jarrett Franklin Shin Kohl-Welles Regala McAuliffe and Kline.

Contact Van Collins at 360-352-5000 with questions or comments.