Oregon lawmakers call for carbon tax study

SALEM, Ore. (AP) — Oregon lawmakers have commissioned a Portland State University research center to figure out how taxing carbon or otherwise putting a price on emissions would affect Oregonians and their factories and businesses.

In October, Gov. John Kitzhaber signed a regional agreement on climate change and promised that Oregon would join California and British Columbia in putting a price on carbon emissions, the Salem Statesman Journal reports.

Now the question is how to do that.

To determine how a fee or tax would affect various economic and geographic segments of Oregon, the Legislature has allocated $200,000, and state officials have hired the Northwest Economic Research Center, led by former state economist Tom Potiowsky.

Its report is due in November, so action on it wouldn't come until the 2015 legislative session.

One goal of a fee or tax would be to reduce greenhouse gas emissions to meet the state's ambitious goals — 10 percent below 1990 levels by 2020 and by at least 75 percent by 2050.

Another would be to create new state revenue, backers told a legislative committee last month.

California recently adopted a cap-and-trade system. It sets an overall limit on emissions, auctions off emission credits and allows the credits to be bought and sold.

Former Gov. Ted Kulongoski pushed a state cap-and-trade system, but the idea languished amid expectations Congress would adopt something like it. That didn't happen.

British Columbia imposed a carbon tax in 2008, starting at $10 per ton and increasing each year to its current price of $30, or about 25 cents per gallon of gasoline.

In Washington, the Legislature also has commissioned a report on options for reducing greenhouse gas emissions.

Taxing fossil fuel energy encountered skepticism among Oregon lawmakers.

"If we want to put a tax on carbon, we want to be sure not to hurt our existing industries or the poor," Republican Rep. Vicki Berger of Salem said.

Jeff Renfro, senior economist at the Portland State center, said the study would take its cue from British Columbia's policy of redistributing some of the revenue from a tax in the form of corporate tax cuts, low-income tax relief and targeted investments in certain industries.

"The centerpiece of the study is modeling what's going to happen to different industries in different areas when we increase their energy price," Renfro said.

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Information from: Statesman Journal

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