How will Vermont reach its Greenhouse Gas Reduction Goals?

How will Vermont reach its Greenhouse Gas Reduction Goals?

Type: 
Blog Post

by Sonja Schuyler, LWV-Vermont State Board

Goal: CO2 emissions at 50% of emissions in 1990 by 2028
Goal: 90% of energy from renewable resources by 2050

Background

Electric Energy

Vermont has taken a major step to reach these goals by joining the Regional Greenhouse Gas Initiative (RGGI – pronounced “Reggie”).  This is a regional cap and trade group of electric utilities that buy and sell CO2 emission credits.  Simply put, if a utility is over its emission requirement, it can buy credits from a utility that is under its requirements, so that regionally the reduction goal is met.  In 2014 RGGI set a cap of 91 million tons of CO2  emissions with a 2.5% reduction of the cap per year until 2020.  The members of RGGI are Connecticut, Delaware, Maine, Maryland, Massachusetts, New Hampshire, New York, Rhode Island, and Vermont.

The credits are bought and sold during auctions that are managed by RGGI. This trading puts a price on carbon.  In the last auction of 2017, the price was $3.80 per ton.  The money is invested in energy efficiency programs and renewable energy.  To date, this program has generated $2.8 billion in economic activity.

Energy Sources

The Public Service Department reported that in 2013, 28% of Vermont energy consumption was electric and 64% of the non-electric energy consumption was from fossil fuels.  This 64% is the biggest challenge for greenhouse gas emission reduction.  Currently, Vermont promotes energy efficiency and weatherization programs which reduce heating fuel consumption.  Reducing transportation fuel consumption now relies on fuel efficiency standards for new cars and trucks, not any state program.

What do we do about it?

The League of Women Voters supports carbon pricing as a way to reduce greenhouse gas emissions. 

Cap and trade is one way to price carbon.  A carbon tax is another way, which the League can support.  So far carbon tax proposals have been rejected by the Legislature.  The Governor is committed to greenhouse gas emission reductions, but he also has rejected the idea of a carbon tax so far.  The Governor has created the Vermont Climate Action Commission with the charge of producing a final report with recommendations by July 31, 2018.

The Climate Action Commission has been holding public events to receive comments and recommendations.  Many carbon tax proposals have been presented to the Commission.  The most recent one is The Essex Plan which was produced by a group of business, environmental, NGO, and academic leaders sponsored by Seventh Generation Corporation.  This proposal has garnered wide support from environmental groups, and we believe that its recommendations will be put into bill form for the 2018 Legislative session.

The Essex Plan

The plan addresses greenhouse gas emissions from heating fuel and gasoline.  The full Plan is available on the Seventh Generation website, [link to pdf].  The Plan approach is to tax the carbon in gasoline and heating fuel and return the proceeds to consumers in the form of rebates on electric rates.  It proposes an initial rate of $5.00 per ton in 2018 and a $5 per year increase until the rate reaches $40 per ton.  The $40 per ton is the Social Cost of Carbon calculated by the EPA prior to 2017.  

Low income and rural Vermonter rebates in addition to the electric rate rebate are part of the program.  A low income, rural Vermonter would receive both rebates.  The rural rebate is intended to offset the higher transportation costs for rural residents.  Off-road diesel would be exempt from the tax since no low carbon options for heavy equipment, including tractors, are currently available.  Fossil fuel use by utilities would be exempt because these are already included in the RGGI program.  Other exemptions would be aviation fuel which is regulated by federal law, and the bio portion of biofuels.

Benefits envisioned by the plan would be economic stimulus to business and industry through savings on electric rates, electric rate savings to residential consumers through rebates, and an economic incentive to reduce fuel consumption.

What will we do?

The State Board will take up its legislative agenda at the January Board Meeting and this will be one of the items.  We plan to work with other environmental groups on this issue.  Please let us know what you think about The Essex Plan or any other ideas to reduce greenhouse gases.  

Information Sources

 

 

 

 

 

Issues referenced by this article: 
Environment

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