Carbon Emission Bill on Center Stage in February Session

Oregon lawmakers will debate a cap-and-invest program at the short legislative session beginning in February that could generate as much as $700 million in new annual revenue to invest in projects statewide to reduce carbon emissions, but opponents warn also could drive up fuel prices, hurt family farmers and disproportionately harm rural residents.

Oregon lawmakers will debate a cap-and-invest program at the short legislative session beginning in February that could generate as much as $700 million in new annual revenue to invest in projects statewide to reduce carbon emissions, but opponents warn also could drive up fuel prices, hurt family farmers and disproportionately harm rural residents.

As Oregonians ponder how to vote on Measure 101 by January 23, Oregon lawmakers are sharpening their arguments for and against legislation in the 2018 session to cap industrial carbon emissions.

Defeat of Measure 101, which contains $320 million in fees on hospitals and health insurers to sustain Oregon’s Medicaid program, could throw a wrench into the short, six-week legislative session that starts in February. However, regardless of the Measure 101 vote, what supporters call the Clean Energy Jobs Act is likely to be a center-stage issue.

The Oregon proposal, developed through a work group and championed by Senator Michael Dembrow of Portland and Ken Helm of Beaverton, both Democrats, is modeled after an existing cap-and-invest program in California.

If enacted into law here, Oregon businesses would be given a limit for their carbon emissions. The estimated 100 Oregon businesses that are likely to exceed the proposed limit would be required to buy market-priced allowances. The allowances would be sold at a North American auction and the revenue generated would be invested in Oregon projects intended to slow climate change.

Backers of the idea say it could generate as much as $700 million annually, providing funding for electric vehicles, residential solar panels, improved bike lanes and utility bill assistance for low-income and elderly Oregonians.

Leading Oregon business and farm groups aren’t so enthusiastic. They warn cap-and-invest will result in higher energy bills, discourage business growth in Oregon, hurt family farm owners and disproportionately harm rural residents. Mark Johnson, a former GOP legislator who now heads Oregon Business & Industry, worries there isn’t enough time in a short session to negotiate an acceptable compromise on such a complex issue.

Similar legislation has been debated in Oregon in previous sessions. This time there seems to be stronger, more unified political support, including from Governor Brown, that might push it through in the 2018 short session in which Democrats control both the House and Senate.

The final version of the legislation is still in flux and isn’t scheduled for public release until next week. Dembrow and Helm are working on ways to mitigate concerns, such as earmarking 20 percent of cap-and-invest proceeds for projects in rural Oregon.

There are strong coalitions working both for and against the proposed legislation. Renew Oregon touts the legislation’s ability to drive clean energy job growth in Oregon. The legislation is also supported by the Oregon Business Alliance for Climate. The campaign against the legislation is organized under the banner of Oregonians for Balanced Climate Policy, which has been around since at least the 2009 session opposing what was then called the Green Jobs Act.