Delaney Releases Discussion Draft of Legislation Allowing States to Implement Carbon Tax to Comply with New EPA Climate Rules
WASHINGTON – Congressman John K. Delaney (MD-6) has released a discussion draft of The State’s Choice Act, which is designed to improve the nation’s response to climate change, empower states to adopt market-based solutions, provide businesses with greater certainty, and spur a faster transition to an alternative energy economy.
Congressman Delaney will consult with experts, stakeholder groups, and constituents on the legislation, which will be introduced in coming weeks. To download the draft bill text, click here.
Congressman Delaney releases the following statement:
“Climate change is the environmental challenge of our generation and I applaud President Obama for making climate change a priority. The stakes here are incredibly high, when you examine the data, it is clear that nearly every aspect of our existence – national security, our food supply, economic health – is threatened by climate change. It’s imperative that we act.
“I fully support the President’s actions to address climate change through EPA’s existing authority. Until Congress acts, these regulations are the only way to begin to respond to climate change before the effects are irreversible. My legislation is designed to give states the option to use an even more efficient method.
“Coming from the private sector, I understand that markets work. To tackle a problem this big, we need to unleash the power of the market and encourage the innovation and drive of our inventors and entrepreneurs. In many cases, a carbon tax will allow us to meet our environmental goals in a more efficient and effective way, ultimately accelerating our transition to a clean energy economy, while also providing businesses with greater certainty.
“The State’s Choice Act gives states the option of complying with the new EPA standards by implementing a carbon tax. My legislation provides states another path to get to the same location: reduced greenhouse gas emissions. This is a market-friendly and environmentally-friendly approach that I believe can bring both sides together.”
The State’s Choice Act will direct the Environmental Protection Agency (EPA) to offer states the option of imposing a state-level excise tax on the greenhouse gas emissions from regulated sources as a way to comply with the regulations issued to combat climate change under Section 111 (d) of the Clean Air Act.
The Environmental Protection Agency (EPA) is scheduled to release a new rule aimed at reducing carbon emissions from existing power plants on June 2.
Congressman Delaney is the only former CEO of a publicly-traded company in Congress.
The State’s Choice Act:
- The legislation requires the EPA to offer states the option of imposing a state-level excise tax on greenhouse gas emissions (commonly called a “carbon tax”) from regulated sources as a way to comply with section 111 (d) of the Clean Air Act.
- The state-imposed carbon tax must be no less than $20 per metric ton of carbon dioxide or carbon dioxide equivalent in 2015 and higher each subsequent year by no less than 4% above inflation as measured by the Consumer Price Index.
- The environment benefits because a carbon tax ensures that the true cost of carbon, including its health and environmental costs, are accounted for, using market forces to incentivize reduced emissions.
- States benefit because they receive additional flexibility when developing their State Implementation Plan for EPA compliance. States can also potentially reduce administrative costs and use the revenues from the carbon tax to reduce other taxes or mitigate increased energy costs.
- Alternative energy producers benefit because they will be placed on a level playing field once the true cost of carbon is accounted for, allowing them to compete on their merits.
- Traditional energy producers benefit by achieving greater cost certainty with a carbon tax.
- Consumers benefit from robust market competition, which will facilitate the U.S. taking the lead in advanced energy technology, driving down clean energy costs.