business backgrounder | regulatory full speed ahead
By all accounts , officials are operating under a rushed timeline to implement an untested and complex policy that has generated more questions than answers for employers .
In June , shortly after officials released the second version of the proposed rule , AWB co-authored a letter to DOE requesting an extension of the comment period pending the answers to 15 pages of clarifications employers sought regarding various elements of the rule , including the purchase of carbon credits , how the rule would be implemented , and how the state was calculating costs .
One serious concern for employers is how the rule will impact industries that use natural gas , which will see a 20 percent price increase , according to Dan Kirschner , executive director of the Northwest Gas Association . This could drive a switch back to lower-cost ( and higher-emissions ) energy sources , Kirschner said . The ramification of that would be “ the exact opposite ” of the intent of CAR , he said . Despite serious questions and concerns , the DOE intends to move ahead , undaunted by economic uncertainty the rule may create .
“ Carbon pollution has reached rampant levels and we ’ re committed to capping and reducing it ,” said Sarah Rees , DOE ’ s special assistant on climate change policy , in a press release announcing the redrafted Clean Air Rule . “ Climate change is the most significant environmental issue of our lifetime , and governments need to act now to protect what we have today for future generations .”
Never mind that in Washington state — the only place where the rule will be enforceable — employers have already been acting on their own for decades . As a result , the state ’ s emissions are below 1990 levels , according to the federal Environmental Protection Agency ( EPA ).
Looking at the bigger picture , the United States as a whole is responsible for 16 percent of total global carbon emissions , according to the Intergovernmental Panel on Climate Change ( IPCC ), the EPA ’ s trusted source . Of that , Washington state ’ s emissions are only 0.03 percent , the majority of which is attributed to transportation emissions .
The biggest emissions offender , according to IPCC , is China at 28 percent . Not only will the state ’ s new regulation do nothing to reduce China ’ s emissions , it runs the risk of driving employers out of Washington to places like China .
Washington state employers
have already been acting on their own for decades . Emission levels are below 1990 .
‘ third rail ’ no one mentions : costs will fall on consumers
Billed as tax on “ big polluters ,” nowhere in the DOE ’ s extensive “ Frequently asked questions about the Washington Clean Air Rule ” webpage does the agency address how the tax will impact energy prices for consumers . The “ third rail ” in the debate , Kirschner said , is being “ swept under the rug .” “ Consumers are going to foot the bill for this — that ’ s 1.3 million natural gas customers in Washington state — that will see the cost to heat and power their homes increase under the Clean Air Rule ,” Kirschner explained . “ The consequence of this policy is that our most vulnerable , those on fixed-income or living hand-tomouth , will be forced to choose between warmth and food .”
AWB ’ s economic analysis reinforces Kirschner ’ s assertion .
Global CO 2 Emissions ( 2011 )
Other Countries 84 %
at a glance
U . S . 16 %
Washington state 0.03 %
After bipartisan rejection of Gov . Jay Inslee ’ s carbon cap-and-tax proposal before the 2015 Legislature , the governor issued an executive order last year directing the state Department of Ecology to draft regulations through state rules to cap carbon , sidestepping the Legislature altogether .
The second iteration of the Clean Air Rule , or CAR , was unveiled June 1 , with public comment through July 22 and final adoption and implementation of the rule is scheduled for late fall .
The Association of Washington Business co-authored a letter to DOE dated June 17 , asking for an extension of the comment period pending 15 pages of clarifications employers needed to calculate the cost of compliance .
AWB and a coalition of employer groups filed a lawsuit in September to stop CAR from being implemented .
The costs and consequences of the rule will not be fully known until it is implemented , which is scheduled to begin in 2017 . fall 2016 37