Governing: The Unlikely Comeback of Cap and Trade

February 1, 2018

Vicki Arroyo discusses the importance of addressing carbon emissions from the transportation sector in an interview with Governing magazine.

“Transportation is the largest sector of emissions now,” Arroyo said. “You can’t achieve economy-wide reductions without tackling transportation.”

The article looks at the role states are playing to reduce carbon pollution through cap and trade, assessing the work of the Regional Greenhouse Gas Initiative. RGGI, made up of 10 northeast and mid-Atlantic states, established a cap-and-tarde program for power plants.

Carbon dioxide emissions from power plants in these member states fell 51 percent between 2005 and 2016. At the same time, the states generated more than $2.6 billion in revenue from quarterly auctions of so-called allowances that power plants must buy to offset their emissions.

The article explores the next big question for RGGI states: how they might expand the scope of their work in the future. The steady drop in power plant emissions has actually prompted a criticism that RGGI is too narrowly focused on electricity. Electric power generators produce a shrinking piece of the total emissions pie. Last year, for the first time, emissions from cars, trucks and airplanes exceeded emissions from power plants. In the RGGI states, power plants contribute only 20 percent of total carbon emissions.

To date, California is the only state with a cap-and-trade program that includes gasoline and diesel distributors. That could soon change. Last fall, Maryland and six Northeastern states launched a listening tour to gather ideas about how to drive down emissions in the transportation sector. Those states are part of a broader working group called the Transportation and Climate Initiative, which includes the RGGI states, plus New Jersey, Pennsylvania and the District of Columbia. Transportation officials in some of the states say they are interested in a RGGI-like arrangement that puts a price on vehicle fuel emissions and invests the proceeds in cleaner transportation options, such as public transit, bike lanes, pedestrian walkways and electric vehicles. Two years ago, the Georgetown Climate Center estimated that pricing policies could reduce transportation emissions by as much as 40 percent by 2030.

Read the full story here.

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