Massachusetts has aggressive goals for reducing greenhouse gas emissions. Under a law signed by Gov. Deval Patrick, the state's economy is, by 2050, supposed to reduce greenhouse gas emissions by 80 percent of 1990 levels. At the present rate, Massachusetts won’t meet that goal.
In order to be on track, the state would have to reduce emissions by 25 percent of 1990 levels by 2020. But a 2014 progress report finds unless something changes, Massachusetts will fall short of the 2020 goal.
Enter the carbon tax.
Right now, there's no carbon tax in Massachusetts, or any other state. State Sen. Michael Barrett, a Lexington Democrat, would like to change that, though technically speaking his proposal is not a tax, but a fee.
"This is carbon pricing," Barrett said, "and the idea is to make it a little more expensive to pollute, a little more expensive to buy something that results in the emission of carbon dioxide into the atmosphere — which is the greenhouse gas that causes climate change — make it a little more expensive to do all that, but then you send the money back so that you spend it on something less polluting."
The greatest portion of carbon emissions in Massachusetts comes from heating buildings. Half the greenhouse gases the state produces come from burning oil and natural gas for heat. Another 45 percent of emissions come from transportation. The biggest component of that is personal vehicles.
Under Sen. Barrett’s proposal, residents would get a check from the proceeds of the carbon fee.
Under Barrett's proposal, residents would get a check from the proceeds of the carbon fee. Under state law, it's not a tax because the money would not go to general revenue, but would go directly back to taxpayers.
"So the idea here is to address the primary moments when you and I contribute to greenhouse gas emissions," Barrett said. "That's when we buy gasoline or buy oil to heat our home or our business."
Barrett's proposal would tax wholesale prices of fossil fuels.
British Columbia has a similar plan in place that reduces other taxes by the amount the state collects in the carbon tax.
Oregon and Washington are considering carbon taxes, as is Vermont.
"At first blush, as soon as you say carbon tax, people say, 'Oh, you're just costing me more money,' " said Vermont state Rep. Tony Klein, a Democrat and the chairman of the Vermont House Natural Resources Committee. "So we're under no false illusion that we're going to get anything passed this session."
Klein says his committee and Vermont's tax committee will be holding hearings on the proposal.
In Massachusetts, Barrett hopes to hold hearings as well. Forty legislators — a fifth of the Legislature — have co-signed his bill.
Quinton Zondervan, the executive director of the Climate Action Business Association, believes that Massachusetts may move quickly.
"I'm very optimistic that we'll make a lot of progress and get it passed in this session," Zondervan said.
But the proposal has its opponents.
"We don't believe it's necessary," said Michael Ferrante, president of the Massachusetts Energy Marketers Association, which represents heating fuel companies. "Honestly, the industry has taken legitimate steps to reduce the carbon content of its fuel with a bio blend, which could be up to 20 percent in this state with biofuels, which has reduced the carbon footprint, so to speak, of our product. We've removed a lot of sulfur from the product. It's an incredibly clean-burning fuel at this point."
A statement from Gov. Charlie Baker's office does not say specifically that he would oppose a carbon tax, but seems to imply that he would.
"Massachusetts’ participation in [the Regional Greenhouse Gas Initiative] ensures we remain on a level and collaborative playing field with our New England neighbors," it said. "The administration believes we can enhance those efforts by incentivizing energy efficiency through the market and by working with other states to reduce greenhouse gas emissions."
A report by Regional Economic Models — for supporters of the carbon tax — found that a $45-a-ton tax would reduce carbon dioxide emissions to 81 percent of 1990 levels by 2031, putting the state closer to the goals set in state law.
The study also found something more surprising: The higher the carbon tax, the more jobs would be created — up to 8,000 net new jobs by 2016.
That's because people would be spending less on goods that come from out of state, such as oil and gas. It's also because they would get the money back from the state to spend on what they want, and that is expected to benefit local businesses.
Correction: An earlier version of this story misreported details of the Regional Economic Models report. We regret the error.
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