House passes resolutions opposing carbon, oil tax

Source: Ariel Wittenberg and Amanda Reilly, E&E reporters • Posted: Monday, June 13, 2016

The House passed resolutions late last week targeting policies meant to address climate change and promote renewable energy that Republicans say would drive up energy prices.

One of the resolutions would express a sense of Congress that a carbon tax would be “detrimental” to the American economy, and the other opposes President Obama’s budget proposal for a $10.25-per-barrel oil fee.

The carbon tax resolution, introduced by Majority Whip Steve Scalise (R-La.), passed 237-163 with two members voting “present.”

While the United States does not currently have a carbon tax, today’s vote sends a signal that Democratic presidential front-runner Hillary Clinton, who has called for action to address climate change, may have a difficult time getting a carbon price through Congress if she becomes president.

No Republicans, including those who have come out in favor of climate change action, voted against today’s resolution.

A carbon tax “would drive up the cost of energy, which would most affect those at a lower income,” Rep. Diane Black (R-Tenn.) said today on the House floor. “It would destroy well-paying jobs in the energy industry.”

Republican Rep. Carlos Curbelo of Florida, even though he voted for the resolution, issued a statement afterward saying he was “firmly committed” to finding solutions to climate change.

A moderate Republican, Curbelo earlier this year helped form a bipartisan caucus in the House devoted to addressing global warming.

He has called climate change an “existential threat” to his home. Rising sea levels linked to climate change already are affecting his district in South Florida (E&E Daily, April 19).

“Today’s non-binding symbolic votes do not help find consumer-driven, market-based solutions that will result in a healthier environment and promote American innovation,” Curbelo said in the statement.

“If Congress fails to offer ideas and alternatives to improve the environment, they will be forfeiting to the arbitrary, heavy-handed regulations advanced by the Administration,” he said.

One Republican, Rep. David Jolly of Florida, voted “present” instead of casting a vote one way or the other. Jolly, considered vulnerable in the upcoming elections, has also expressed concerns about the impacts of climate change on his district.

Six Democratic members joined their Republican colleagues in opposing a carbon tax, including Reps. Brad Ashford of Nebraska, Sanford Bishop of Georgia, Henry Cuellar of Texas, Ann Kirkpatrick of Arizona, Collin Peterson of Minnesota and Kyrsten Sinema of Arizona. Democratic Rep. Michelle Lujan Grisham of New Mexico voted “present.”

Even though some House Democrats sided with the GOP, most of them this morning opposed the measure on the floor, saying that it was indicative of Republicans’ climate denial.

“What it does is it expresses the nonsense of Congress,” Rep. Matt Cartwright (D-Pa.) said. “We are here witnessing the latest example of climate denial.”

Democrats also called for a substantive congressional debate on a carbon tax, which many economists agree is an efficient way to reduce carbon dioxide emissions. They emphasized the handful of conservative advocates who have called for a carbon tax that uses revenue to lower capital and income taxes.

“I really appreciate this little window of an opportunity to talk about a carbon tax,” said Rep. Earl Blumenauer (D-Ore.). “I hope that the day will come when we will have an opportunity to have that discussion in a robust and thoughtful way in our Ways and Means Committee.”

Some conservatives in favor of a carbon tax earlier this week said that the fact the House was holding a vote on a carbon tax showed that the idea of a price on carbon is gaining momentum (E&E Daily, June 9).

Oil companies torn

Six major oil and gas companies — BG Group PLC, BP PLC, Eni SpA, Royal Dutch Shell PLC, Statoil ASA and Total SA — last year called for a price on carbon in the runup to the Paris climate negotiations. The firms did not specify whether they supported a tax or a cap-and-trade program.

Exxon Mobil Corp., facing pressure over its past research and disclosures on climate change, has also publicly endorsed a revenue-neutral carbon tax.

Environmentalists, however, have criticized the company for not actively lobbying on the issue. And the refining trade group American Fuel & Petrochemical Manufacturers, which counts among its membership Exxon and subsidiaries of BP, Shell and Total, today came out in favor of the House resolution against the tax.

“A carbon tax, or consumer energy tax, is bad for American consumers and business and this resolution makes that clear,” AFPM President Chet Thompson said in a statement.

The American Petroleum Institute, however, did not weigh in on the vote.

David Bookbinder, former chief climate counsel at the Sierra Club, said there was no incentive for oil and gas companies to individually advocate Congress for a carbon tax as long as refineries are not subject to restrictive greenhouse gas limits.

“They support it. They’re not going to advocate for it,” said Bookbinder, who now consults on climate and energy issues at Element VI Consulting.

Conservatives who have endorsed a carbon tax, including former South Carolina Rep. Bob Inglis, have also called for eliminating regulations targeting greenhouse gases, including U.S. EPA’s Clean Power Plan.

While some are claiming momentum, Bookbinder said that coming to a compromise between those conservatives and environmentalists who want to see Congress pass climate change legislation would be a difficult balance.

“The environmental groups would like to make progress, but they just don’t know how much of the regulatory program they would give up,” Bookbinder said, “and you can start fights with them by saying you’re going to have to give up all the stationary source authority, and they run screaming from the room.”

He said, “If you go to the Republicans and say, ‘No, you have to keep the regulatory program,’ Republicans walk out of the room.”

Republican energy strategist Mike McKenna also predicted that the idea of eliminating regulations for a carbon tax was not likely to gain wide approval.

“The idea of a regulatory swap for a carbon tax is pure myth,” McKenna wrote in an email yesterday evening. “It is a way to get some (not bright) Republicans to negotiate with themselves.”

Oil tax

The House also passed a resolution from Rep. Charles Boustany (R-La.) opposing the Obama administration’s proposed $10.25 oil tax in a vote of 253-144.

Republicans slammed the proposal when the White House released it earlier this year. Critics called it “dead on arrival.” And many Democrats remained largely silent on the issue (E&E Daily, Feb. 5).

Democrats walked a thin line today in debating Boustany’s resolution opposing the oil tax, speaking out against the resolution while steering clear of actually supporting the president’s proposal.

Blumenauer went only so far as to defend the intention behind Obama’s idea.

“The president is not imposing a fee to have the money burned up, he is proposing a fee to fix America’s crumbling infrastructure,” he said.

Blumenauer disagreed with Republican characterizations that the fee would be overly burdensome, noting that drivers already have to pay increased vehicle maintenance costs because of deteriorating roads.

But while Blumenauer said he supported some mechanism to pay for infrastructure repairs, he did not expressly voice support for the oil tax itself, saying instead that the House Ways and Means Committee should “sit down and actually have meaningful discussions.”

House Transportation and Infrastructure ranking member Peter DeFazio (D-Ore.) took a similar approach. In a passionate speech, he said he opposed the resolution for being a “meaningless piece of paper” and a “waste of time.”

DeFazio accused conservatives of using the resolution to avoid a debate on alternative ways to fund infrastructure improvements.

“What they are doing is continuing to avoid a discussion of how we will pay for the nation’s infrastructure,” he said.

DeFazio noted that the gas tax has remained the same since 1993 and that Republicans have consistently resisted Democratic proposals to raise it, along with other highway “user fees” to pay for infrastructure.

“If I was in the majority I would be embarrassed if this is what I was wasting time on when people are trapped in traffic and people are dying and blowing out tires,” he said. “We are all for infrastructure until it comes to paying for it.”

For their part, Republicans made arguments against the oil fee similar to those in opposition to the carbon tax. They said a $10.25-per-barrel tax would be a “stab in the heart” of the economy.

“We should be embracing the energy revolution that is being unleashed by American innovation, not taxing it into oblivion, not overregulating it into oblivion,” Boustany said.

The lawmaker also insisted that Republicans were in fact in favor of “user fees” but did not offer any specific examples other than expressing support for the gas tax.

Rep. Garret Graves (R-La.) said: “The gas tax was set up to be a user fee. It was set up to be a user fee that the more you drove, the more you use the roads, the more you pay for it. That’s the way this is supposed to work, and the president has come out and offered a proposal that disconnects that.”