CALC Executive Director
After the June 2, 2014 announcement of the President’s climate action plan, the White House will head to the UN Secretary General’s Climate Summit in New York next week with some bargaining chips. While some have criticized the lack of boldness in the President’s Climate Action Plan, at least the White House, unlike Congress, is actually starting to do something about climate change. The administration’s current plan for emissions reductions largely leaves the states to their own devices in developing mechanisms for achieving mandated reductions. For Massachusetts, this is a great opportunity to create a bold action plan to increase renewable energy, increase energy efficiency, and to put a price on carbon pollution.
Both our Executive Director, Quinton Zondervan and our Program Director, Michael Green, will be attending the summit with this call for action: implement a statewide price on carbon pollution in Massachusetts. Putting a price on carbon would not only reduce emissions, it would also create new jobs in the Commonwealth. We have the data to back up that assertion, and now it is time to show the nation, and the world, that we can achieve our emissions goals and economic prosperity through the implementation of a meaningful, revenue neutral carbon tax.
With support from Tech Networks of Boston and CALC, the Regional Economics Modeling, Inc. (REMI) performed a study in July 2013 on the economic impact of a revenue-neutral carbon tax in the Commonwealth. For this study, REMI evaluated a $15, $40, and $45 per metric ton tax. The results were profound.
Employing a $30 per ton price on carbon would result in yearly emission reductions of up to 5 million metric tons by 2035. Putting this in perspective, this would be the equivalent of taking 1.2 million cars off the road. Due to the revenue-neutral nature of the assessed tax, funds in the REMI study are assumed to be used for one of three things: the first $100 million goes towards a state fund for research and infrastructure development and the remainder is split 50-50 between businesses and households in the form of reduced corporate income taxes, lower income taxes for households, and lower sales tax.
By discouraging fuel consumption in Massachusetts, our state would require less fuel imports and therefore keep more money in the state. With more in-state money, consumer spending would increase in activities like retail, boosting the local economy. This would mean more jobs for the Massachusetts economy. Assuming a $30 carbon tax, an additional 8,000 job/year would be added to Massachusetts by 2035.
The UN Climate Summit is an opportunity to show bold leadership and action on one of the greatest threats of our time. There is no silver bullet for resolving the climate crisis, and that means we will have to try different approaches. At CALC, we are confident that a significant part of the solution lies in putting a price on carbon pollution.