Washington carbon tax advances to ballot, strongly supports DERs


In November, Washington voters will decide whether to impose a pollution fee on large CO2 emitters. In early August, the Protect Washington Act measure was approved for the ballot, which would impose a fee on CO2 emitters, based on the carbon content of fossil fuels sold or used in the state, and electricity generated in or imported for consumption in the state. If the ballot measure passes, it would be the first carbon tax in the country. Beginning January 1, 2020, the fee would start at $15.00/metric ton of carbon content. The fee rises by $2.00/metric ton annually until the state’s 2035 GHG-reduction goal is met, and the state’s emissions are on a trajectory that indicates that compliance with the state’s existing GHG reduction goal of 50% below 1990 levels by 2050 is likely. Certain exemptions are allowed, including fossil fuels exported or sold for export outside the state, fossil fuels directly or eventually supplied to a utility for electricity generation, and fossil fuels and electricity sold to and used onsite by facilities with a primary activity that falls into an energy-intensive and trade-exposed sector.

Seventy percent of total revenues under the act must be used for eligible clean air and clean energy investments, which include renewables, energy storage, other DERs, DSM projects, grid modernization, clean transportation, and self-directed energy efficiency. The revenue generated would also support workers affected by the transition away from fossil fuels. Electric and gas utilities may receive credit for their investments in clean energy, if they develop a clean energy investment plan approved by the Utilities and Transportation Commission (for IOUs) or the Department of Commerce (for consumer-owned utilities). The initiative also includes numerous implementation, oversight and reporting requirements.