The Oregon plan has adopted a more time-tested strategy. The Beaver State proposes to “cap and trade” carbon: The bill would limit the amount of carbon that can be emitted in Oregon, then auction off the right to emit it to companies. Under the bill, the state would join California, Ontario, and Quebec in the North American Cap-and-Trade Program.
That program has historically imposed a price between $12 and $16 per ton of carbon pollution. If Oregon joins the program, some of the revenue would be reinvested in renewable energy and other state projects; the rest would be distributed to utilities, who could rebate it back to consumers in their electricity bill.
Oregon, like California, also has a number of smaller-scale climate laws in place. And nine states in the northeast—including New York, Maryland, and Massachusetts—run a regional cap-and-trade program, though that market only covers carbon pollution from the electricity sector. (Well before the Trump years began, climate change has been a site of especially exuberant liberal federalism.)
Do these programs work? “In the northeastern states, in Quebec, Ontario, even a very modest price can bring emissions down,” Eberhard told me. “A modest price plus other policies—like we see in California—is more effective. And a more aggressive price with other policies would be very effective.” But there is no state or province in North America with an “aggressive price” right now.
There is also no state with a working carbon tax. The closest model in North America is the Canadian province of British Columbia, just across the border from Washington. B.C. first imposed a carbon tax of $10 per metric ton in 2008, which has since risen to $30 per ton. But in the last decade the province has also seen a profitable fracking boom. “They’ve had this explosion in shale gas, so their emissions have been going up,” said Eberhard.
National politicians have periodically expressed interest in a carbon tax. Earlier this week, 22 College Republican groups and a handful of College Democrat clubs endorsed just such a policy. But right now, there is no working U.S. carbon tax for an eager politician to study, copy, or improve.
Democrats, the party of climate change, will pay for this missed opportunity. Due to the necessity of long-term planning and state financial years, the failure of Washington’s bill this week means that there will likely be no state-level carbon tax in the United States until at least July 2020, if Washington voters (or state legislators) approve the measure at their next opportunity. Therefore, there will likely be no American carbon tax on the books during the next Democratic presidential primary. And if a Democratic president takes office in January 2021 promising to pass a carbon tax—which is exactly what Bernie Sanders promised during his 2016 run—he or she will only have, at best, a six-month-old policy, in just one state, to adapt for the nation.