Angling for LCFS policy continues

Angling for LCFS policy continues
Although a low carbon fuel standard (LCFS) proposal seems dead in the water this session, it may be part of negotiations over a new transportation package. Photo:

Although a low carbon fuel standard (LCFS) bill reintroduced from last session and passed by the state House appears to be going nowhere in the Senate, the general idea could still move forward as proponents continue to push the policy on a variety of fronts.

After clearing the House on Jan. 29 in a 52-44 vote, HB 1110 was referred to the Senate Environment, Energy & Technology Committee. Although it has yet to receive a public hearing, one could be scheduled in the coming weeks.

Even if that bill fails to advance, an LCFS could become part of negotiations over the Forward Washington transportation package proposed by Transportation Committee Chair Steve Hobbs (D-44).

However, HB 1110 sponsor Rep. Joe Fitzgibbon (D-34) recently told TVW’s Austin Jenkins: “I don’t think he’s going to get a signature from the governor and I don’t think is going to get a House vote on a transportation revenue package until we have a meaningful plan in place to reduce pollution from transportation fuel.”

When asked about this at a Feb. 13 media press conference, Governor Jay Inslee said “no one should doubt my commitment to getting additional transportation infrastructure,” but didn’t say whether he would support a new transportation package if an LCFS were passed this year.

A third possible route for an LCFS is through SB 6628 sponsored by Sen. Reuven Carlyle (D-36) at the request of Inslee’s office. The bill seeks to give the state Department of Ecology statutory authority to regulate indirect carbon emitters through its Clean Air Rule after a recent State Supreme Court decision ruled against the agency. The bill cleared the Senate Committee on Environment, Energy & Technology on Feb. 6 and could receive a Senate vote soon.

Stakeholders say the bill language is so broad it could be interpreted as granting Ecology the authority to impose an LCFS.

“The bill represents a sweeping grant of authority from the legislature to the Department of Ecology without legislative direction parameters or sideboards,” Greg Hanon with Western States Petroleum Association told the committee at a Jan. 29 public hearing.

“We believe that the legislature is the proper place for these conversations to happen,” said Charlie Brown with Cascade Natural Gas. “We would encourage all of you to set this bill down and to start working with…all the stakeholders in the state toward an actual carbon emission reduction proposal that would work for all the industries in the state.”

Inslee denied at the Feb. 13 press conference that the bill is intended to circumvent other Senate committees less favorable to an LCFS.

“Senate machinations on their own, I’m the governor that is setting a vision statement…and I’m calling for them to step up to the plate and act,” he said.

The transportation package is a follow-up to the 2015 Connecting Washington funded by a $.12 increase to the state gas tax. Included in that package was an implicit prohibition on an LCFS program before 2023. Inslee said at the Feb. 13 press conference that the provision was included because he viewed the Republican Senate as “minions for Donald Trump” and said “I believe we now are ready for action, and I am expecting that we will have it (LCFS).”

Either way, the expected gas price increase from an LCFS may ultimately deter state lawmakers looking to generate new funding via a gas tax hike. HB 1110 authorizes the state Department of Ecology to set up an LCFS program that gradually lowers the amount of carbon intensity in fuels. The Puget Sound Clean Air Agency is also contemplating a regional version that – according to its own analysis – may raise gas prices by $.57 per gallon – more than seven times the gas tax increase proposed in Forward Washington.

Hobbs introduced the package last session and it was the topic of a Feb. 5 work session in the Senate Transportation Committee. He plans to roll out the final bill during the 2021 session.

Hobbs told colleagues the intent of the package is to accomplish two major objectives: Fund fish barrier removal mandated under a federal court injunction and invest in highway improvements and maintenance. The Washington State Department of Transportation (WSDOT) last year reported a $700 million per year funding gap for highway maintenance and preservation.

“We could use that (money) right now with our crumbling bridges and our roads on both sides of the state,” Hobbs said. “I view this as both a transportation bill and an environmental improvement bill.”

There are currently several proposed versions of Forward Washington, though all of them contain a variety of new vehicle fees and $.06-$.08 gas tax increase. The first two impose a carbon fee, either with or without utilities included. The third version uses cap and trade as a primary funding source. Under that model, a gradually declining cap on emissions is set, and allowances are purchased by affected entities The first two versions would generate more than $19 billion over 15 years, while the cap-and-invest version would raise $18.8 billion.

Among the projects funded include the I-5 Bridge Replacement, State Route 18 widening, State Route 105 Culvert improvements and a full rebuild of the US 2 trestle between Everett and Lake Stevens.

“We just have to figure out a new way to fund our transportation,” Hobbs said. “I don’t think we should put our heads in the sand over this particular bill. It doesn’t help when you have some people who say: ‘You’re no better than a climate denier,’ by offering something different.”



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