Democrats roll out revised plan to cap carbon emissions

 Democrats roll out revised plan to cap carbon emissions

Caption: Gov. Jay Inslee

SEATTLE (AP) - Washington state Democrats are re-crafting Gov. Jay Inslee's ambitious plan to make industrial polluters pay for their greenhouse gas emissions, hoping their version could win over some businesses and others wary of its impacts.

A proposed substitute to House Bill 1314 sets an overall limit on heat-trapping gases similar to the cap-and-trade plan Inslee proposed to much fanfare in December. It also requires most of the state's largest polluters to pay for every ton of carbon they release.

But the new plan gives substantial rebates back to oil refineries and some manufacturers to make it easier for them to comply.

Metal and food manufacturers, paper mills and others in "energy-intense industries," for example, would get all their compliance costs back during the first five years. Meanwhile, fuel suppliers would get a 75 percent rebate to help keep down fuel price increases.

The new plan would raise about $1.3 billion a year, with about $500 million going to pay for K-12 education and $108 million to help low-income families.

It also allocates new money for forest landowners, wildfire suppression and projects to increase carbon sequestration but no money is set aside for transportation projects. Inslee had dangled revenues, including $400 million for transportation, as a way to meet budget shortfalls and pay for the state's pressing needs.

"We're glad this is now part of the House majority's budget proposal," said Inslee spokeswoman Jaime Smith in an email.

She said the governor has always been open to ideas on how best to reduce carbon pollution and the House's proposal continues that conversation.

The substitute bill, sponsored by Reps. Ross Hunter, D-Medina, and Larry Springer, D-Kirkland, is being heard Thursday in the House Appropriations Committee. Sen. Jim Hargrove, D-Hoquiam, is introducing a similar measure, Senate Bill 6121.

Republicans, who control the Senate, have been opposed to the concept, saying it would hurt consumers and raise gas prices.

"I'm still fully committed to giving the bill a hearing when it passes out of the House," said Sen. Doug Ericksen, R-Ferndale, who chairs the Senate committee handling energy and environment. "We're just waiting for them to pass legislation so we can take a look at it."

He added that "it's still a tax on energy" and working families will be the ones paying for it.

Rep. Joe Fitzgibbon, D-Burien, who sponsored the original House Bill, said the proposal puts a price on greenhouse gas emissions but also responds to concerns raised by businesses.

"The bottom line is that we have greenhouse gases under a firm cap and that we reduce the cap over time," Fitzgibbon said in an interview Monday. His bill had passed out of the House Environment Committee in February but didn't gain traction in the Appropriations Committee.

Under the House substitute bill, fuel suppliers would get a 75 percent rebate on compliance costs associated with fuel they supply in state. That translates to about $333 million a year in rebates.

Industries such as paper mills and metal, food and computer manufacturers that use a lot of energy and face trade competition also would get all of their compliance costs back in rebates during the first five years of the program. The rebate would drop to 80 percent afterward.

"We're focusing on the positive," said Clifford Traisman, a lobbyist for the Washington Environmental Council and Washington Conservation Voters. "It's not a perfect bill."

"Revenue will have to be part of the final equation. Why not putting a price on carbon and reducing pollution while raising revenue?" he added.

Under the House Democratic plan, there's new money, about $193 million a year, for an economic development program that pays certain forest landowners who sell state timber to state mills.

"This is no longer just a climate change bill," Hargrove said in a statement. He said it reduces emissions while creating jobs in rural and other areas.

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