(PASCO,
WA) -- The Franklin PUD Commission unanimously passed a resolution today at its
regularly scheduled board meeting opposing Initiative 732 that imposes an
escalating tax on carbon emissions from electricity generated by fossil fuels.
A
citizens’ group identifying itself as “Carbon Washington” (CarbonWA) has
gathered sufficient signatures in 2016 to place Initiative 732 (Initiative),
also known as the Carbon Pollution Tax Act, before the Washington State
legislature. By the end of the special session, the 2016 Washington
State legislature chose not to adopt the original Initiative, which automatically
sends it to the ballot before the Washington State voters in November
2016. The Initiative is intended to encourage cleaner energy solutions by
taxing, per ton, carbon dioxide (CO2) pollution from fossil fuels.
If
passed, the Initiative would impose an escalating tax on the carbon emissions
from the electricity generated by fossil fuels, including electricity generated
within, imported into Washington, or acquired from the Bonneville Power
Administration (BPA). The Initiative proposes a $15 tax per metric ton
(PMT) of carbon dioxide emissions beginning July 2017, increasing to $25 PMT in
July 2018 and increasing 3.5%, plus inflation annually thereafter up to a $100
PMT limit.
“This
tax will be imposed on the consumer of electricity, our Franklin PUD customers,
then the tax will be collected by Franklin PUD and remitted to the State’s
general fund with no clear path that guarantees a reduction in carbon
emissions”, stated Roger Wright, Franklin PUD Commission President. The
administrative and reporting requirements in the Initiative will result in
increased staff time, the cost of which is not currently determinable.
This
is taking place while Franklin PUD already provides over 90% of our electricity
to customers that is carbon free - thanks to hydro, wind, and nuclear
power.
Of
main concern to Franklin PUD is that the utility is being required to use the
Washington State Fuel Mix report as compiled by the Department of
Commerce. This report has been proposed to be the basis in determining
the monthly carbon tax on Franklin PUD customers. According to the
Initiative, the percentage of Franklin PUD’s fuel mix that comes from an
“unspecified resource” will be considered coal, regardless of its source -
which could be from hydro, wind, solar, nuclear or other sources. The
Initiative assigns a carbon liability for market purchases of electricity made
by BPA and is included in the electricity Franklin PUD buys from BPA, which is
about 85% of Franklin PUD’s power purchases. Market purchases are made by
BPA when there’s a need for more electricity, which often occurs during times
of lower hydropower generation.
Franklin
PUD customers would incur additional costs from the Initiative mandates
estimated to be between $1,880,000 and $3,164,000 annually when fully
implemented. The cost is projected to vary depending on how much
hydropower is available and the need for market purchases.
Franklin
PUD will continue to work with other utilities on carbon reduction solutions.
