New Cap and Trade Bill Debuts at Oregon Senate

Oregon State Capitol at Sunset

On January 13, the Oregon Senate held the first public hearing for a revised version of the cap and trade bill.  

With House Bill 2020 defeated last year by the Republican walkout and emissions goals looming overhead, state Democrats returned to the drawing board. Their new proposal, Legislative Concept 19, keeps the main thrust of HB 2020, but makes several key concessions to appease business and rural interests.  

According to Senator Michael Dembrow of Portland, “The goal was to get a bill that can pass this session. That’s the priority.”  

The version of LC 19 shown at the Monday meeting of the Senate Committee on Environment and Natural Resources was a rough draft, which is intended to be modified throughout the February legislative session.  

The cap and trade agreement in LC 19 is mostly the same as its predecessor — the state sets an overall cap on greenhouse gas emissions, and emitters are required to purchase credits for every ton of emissions they produce.  

However, unlike HB 2020, the new proposal uses a staggered model to implement automotive fuel regulations specifically, starting with the Portland metropolitan area in 2022, followed by other metro areas in 2025. Regulation in the rest of the state will be voluntary until 19 other counties opt into the program.  

The provision is intended to address concerns over gas hikes affecting rural areas disproportionately, with a catch. LC 19 does provide significant incentive to participate in the program — 80 percent of sales from fuel emissions credits will go back to the communities that paid for them.  

LC 19 also does not factor in natural gas when calculating manufacturing emissions, more than halving the number of affected facilities.  

However, some of the previous bill’s supporters see these accommodations as a step backwards.  

Meredith Connolly, the Oregon director for clean energy nonprofit Climate Solutions, told OPB “What we saw in the LC that came out is a major overcorrection to accommodate industry push back. What we’re hoping to see is a little more righting of the ship.”  

By Brandon Urey