Climate Bill Delivers Large Benefits At Low Cost By TOM BOWERMAN


Oregon’s Healthy Climate Act, Senate Bill 1574, currently being considered by the Oregon Legislature, is coming under predictably inaccurate criticism. A Feb. 10 guest viewpoint by Chris McCabe, executive director of the Northwest Pulp and Paper Association, while skillfully written, contained critical errors that beg rebuttal.

That guest viewpoint begins with a deft recognition of the high esteem we Oregonians place on our state’s natural beauty and resources, and continues with representations of how much the paper industry has reduced emissions in the past decade or so. I join McCabe in commending Oregon’s natural qualities, his industry for adopted conservation and efficiency technologies, and his acknowledgement of the role governmental policy has played in nudging good behaviors along.

The first significant error is McCabe’s characterization of the bill as an attempt to have Oregon “go our own way in isolation.” I agree that Oregon should not act in isolation. Key sponsors designed the bill to join a consortium of western states and Canadian provinces. This consortium represents the fifth largest economy in the world. The Healthy Climate Act allows Oregon to join an already well-tested and fully functioning system, quite the opposite of “go[ing] our own way in isolation.”

The next big error describes the policy as hitting consumers with a gas tax of 60 cents per gallon. The unnamed “report” McCabe most likely used for this assertion was a Portland State University economic analysis having nothing to do with the current bill; rather, it examined a carbon tax concept from several years ago.

Instead, McCabe should have cited actual evidence from California, which passed a similar policy in 2007 that currently applies a cost of about 13 cents per gallon to companies emitting in excess of 25,000 tons of carbon dioxide per year (see California has the lowest emissions per capita of all states.

So, yes, the bill does create a fee on pollution assessed to about 90 of Oregon’s big polluters. Revenue from this fee is then reinvested in greenhouse gas reduction efforts directed to lower our statewide emissions while also protecting at-risk low-income sectors.

Rather than the bad economic result McCabe asserts of California under its program, that state has been recording the best economic performance in the country (see

McCabe’s claims that eight Lane County businesses “will pay a combined $77.4 million in additional costs under the bill.” This unsubstantiated claim falls apart by examining Oregon’s current list of covered entities. Only one Lane County business emits more than 25,000 tons of anthropogenic CO2 per year, at 100,700 tons. Applying the emission fee currently observed with existing program participants, this cost would be $1.3 million, less than 2 percent of McCabe’s figure (

This dramatic misrepresentation of costs was also made by opponents of California’s program in 2007. More importantly, those opponents’ “death of the economy” claims are now seen in evidence to be diametrically wrong.

The opposition claim that the fee to pollute would cause industries to flee the state to locations with lesser regulatory costs is addressed in the bill. Realizing there is no emission reduction when trade-sensitive high-emission businesses relocate to avoid regulatory fees, the policy provides for waivers to avoid such relocation.

The Healthy Climate Act would be the keystone greenhouse gas reduction policy for Oregon. Similar programs have already been successfully implemented by other big industrialized economies, including California, Quebec, and nine Northeastern and mid-Atlantic States. The experiences of these jurisdictions are unanimously positive, and the Canadian province of Manitoba announced in December that it would link its program with Ontario’s and Quebec’s (which are in turn linked with California’s program). Oregon may be a small state, but its commitment to responsible climate policy requires us to put our shoulder to a unified effort.

As citizens and policymakers, we must separate disinformation from actual evidence. I understand McCabe may be too busy to gain a real understanding of how the policy works elsewhere or how it will apply in Oregon. Our Lane County legislative champions of the Healthy Climate Act have given it considerable attention and should be commended for their leadership. Our grandchildren will owe them a debt of gratitude if we are successful in passing it.

Tom Bowerman directs PolicyInteractive, a Eugene-based nonprofit policy research organization that studies climate policy. For source material, go to

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