Oregon Cap-and-Trade: Dems Offer Concessions This Time

Lawmakers are taking a new tack with this year’s proposed cap-and-trade bill: a region-specific rollout of the fuels portion of the program. This would use existing tax data about Oregon fuel sales to make sure that only large population centers are affected by the law at first.  

COMPROMISE WITH RURAL AREAS. One of the main objections to statewide cap-and-trade is that when large firms like Shell and BP pass along their increased costs, the price hikes end up unfairly affecting rural residents, who have comparatively lower wages and greater fuel requirements than city dwellers. This is one of the issues that killed last year’s bill.  

To address the problem, the new bill, if passed, would first apply only to the Portland Metropolitan Area, and then, successively, to other high-population centers before moving into rural Oregon – and then only if certain conditions are met, such as a number of those counties opting in.  

OREGON DEQ WOULD NEED DATA. For this kind of geographic rollout to work, program administrators will need to know where fuel goes after it leaves the states various source terminals. The entity charged with this would be the Oregon Department of Environmental Quality, using Department of Transportation fuels tax data.   

FUEL DISTRIBUTORS SKEPTICAL. Although the state says it has a good handle on what fuel goes where, fuel distributors are not so sure. They reason that big fuel importers do not have bills of lading for their product, other than to sell to their clients, who may or may not be within with proposed rollout districts. The idea of a gradual, geographic rollout is a novel one, and though it offers considerable concessions to the opponents of cap-and-trade, it may face an uphill battle similar to last year’s, which had Republican lawmakers leaving the state, denying Democrats a quorum.  

By Peter Bask