A group of Northeast states - including New Hampshire - is expected to propose a plan this month to reduce carbon emissions from the transportation sector.
Cars and trucks are the region's biggest source of climate emissions, and one of the most challenging to tackle.
Now, the region is drafting a program called the Transportation and Climate Initiative, or TCI.
It's a "cap and invest" program that's comparable to the Regional Greenhouse Gas Initiative, or RGGI, which limits carbon emissions from power plants and which analysts say has boosted regional economies.
TCI would likely make fuel distributors pay for emissions they cause over certain limits. It would raise money for other climate change programs, but it could raise costs for drivers.
New Hampshire and a few other states have participated in the planning process for TCI, but haven't committed to adopting it.
But State Sen. David Watters, who's planning to propose a legislative commission to study the benefits of joining the program, says he believes it could transform the way the region drives.
"I think that Transportation and Climate Initiative, for all the states basically from Maryland north, will drive a lot of people toward electric and alternative fuel vehicles," Watters says.
This month, the Northeast states will put out a framework of the TCI program in the form of a draft memorandum of understanding. When finalized with public comment, it'll be a template bill that each state can then decide on adopting during their legislative sessions next year
On a recent episode of NEXT from the New England News Collaborative, NHPR's Annie Ropeik sat down with reporters John Dillon of Vermont Public Radio and Zeninjor Enwemeka of WBUR to talk more about the TCI, and the potential obstacles it faces in their states.
The following transcript has been lightly edited for clarity.
Annie Ropeik, NHPR: Let's talk about the problem first. How much of our emissions actually come from transportation and what do we mean when we say transportation?
Zeninjor Enwemeka, WBUR: A huge chunk of our emissions come from transportation. In Massachusetts, transportation accounts for about 40 percent of emissions and it's about the same for the region. It's really the largest share of any sector. And so we're talking about vehicles, we're talking about transportation, infrastructure - anything transportation, transit related. And what's also interesting with transportation is that it's really the only sector where emissions have continued to grow over time, according to state officials here. We've seen emissions reduced in other sectors, but transportation has been a big challenge.
AR: In New Hampshire, we've lowered our emissions from energy generation quite a bit more over the years than transportation, which has remained roughly flat. So why is it such a tough nut to crack?
John Dillon, VPR: For a number of reasons. First, transportation, as you know, it's not regulated like electric utilities are. And then secondly, there's not a clear point source. Right? There's millions of point sources zooming around the region, often driven by single willful humans. And so how do you regulate them? And then there's many, many more regulated entities to potentially regulate that actually supply the fuel to those millions of people driving. One reason that our transportation emissions are particularly problematic in Vermont is what we drive in Vermont. The most popular car isn't a car, it's an SUV or a truck.
AR: So the region has come up now with this tentative solution. It's called TCI, the Transportation and Climate Initiative. Tell us who's involved and what this might do.
ZE: TCI is several states that are working together to reduce carbon pollution from transportation. It includes the New England states and several others in the Northeast. The key policy focus with TCI is a "cap and invest" program. The goal would be to drive down emissions from vehicles in particular and transition to a low carbon transportation system. So it would work like this: there would be a cap on emissions, and fuel suppliers who transport across state lines will hold in trade those emission allowances based on that cap level.
A lot of advocates I've spoken to say that this type of policy would create an economic and business incentive to import cleaner fuels. Here's Chris Dempsey, the director of the advocacy group Transportation for Massachusetts.
Chris Dempsey: "It's a policy that is meant to put itself out of business over time. It is intentionally meant to reduce emissions. And as those emissions are reduced, the demand for those permits should be reduced also until we move to a much more electrified and decarbonised transportation system."
AR: We've heard some people call this framework cap and trade. We've also heard it called a gas tax. What do you make of those comparisons?
JD: I think it's a little bit of both. It is cap and trade or cap and invest for sure. And the advantage of that over a straight gas tax is that you leverage the money back into the system to get more efficient transportation. That's the whole idea. But there will be a cap on these allowances and people will have to buy the allowances. So there are huge questions about how many and what entities actually have to buy it.
But then secondly, and where it becomes sort of a tax, is how the cost of those allowances are passed on to the ultimate consumer. So, you know, it may not be a tax like a excise tax that you pay currently on gasoline, but there will be an additional cost added to fuel somewhere along the chain. And the fuel dealers that I've talked to in Vermont, they estimate that, you know, it could have an impact of five to 18 cents at the pump. So while it may not be a tax per say, the impact could be very similar.
AR: And that's sort of a decision that would be left to the distributors?
JD: Right, if they are the targets of this. It's up to them to decide how to absorb that additional cost, whether to pass it on to consumers, to their gas stations, you know, and then the gas stations decide whether to pass it on to their consumers.
AR: Is the TCI framework going to try to speak to any of that, to limit impacts to customers at the pump? Is that still an open question?
JD: I think that's still an open question. I don't think it's going to get that granular, at least in this next round coming up about how it actually gets passed through. I think that will be left up to the individual entities. You know, if people, if the wholesalers, are paying more for fuel, it stands to reason that they're not going to just absorb all that. They'll have to pass some of it along to consumers.
AR: That gets us to this question of of equitable impacts and kind of almost the environmental justice of implementing this policy. Zeninjor spoke with Dan Sieger, the undersecretary of Environmental Affairs in Massachusetts, about TCI:
Dan Sieger: "The other, you know, sort of challenge to it is, across states in the region, you have various populations from very dense urban populations to very rural agricultural populations and everything across the board. And I think, you know, we're really committed to making sure that we have a program that takes into consideration the impacts that it's going to have on on various demographics. I think that those have been, you know, the challenges that we've heard, but also a lot of the focus of the work that we've been doing."
AR: So what about this question of equity and fair impact?
ZE: Yeah, that's a big question. And officials in Massachusetts say that this has been a big talking point. They've been over the last several months doing different listening tours around the states. I think, you know, what's interesting with TCI, you have all these different states and you're looking at a region that has a mix, right, of urban, rural.
And so there is a lot of concern about a policy potentially having a disproportionate impact, you know, on rural communities or, you know, concerns about where the revenue from this policy would go. If there's a lot of money being raised from rural environments, will that only go to support urban transportation systems? So this is a big question, and talking points that state officials here have been grappling with, and it's something that I think we'll hopefully see some more details around in this next round with the states coming together to create some sort of memorandum of understanding that we're expecting this month.
AR: When that memorandum of understanding comes out [in December] and goes for public comment, then as states will get to decide individually whether to implement it. In some states, including here in New Hampshire and Vermont, officials have sort of stayed in the planning process, but not fully committed to adopting the final product once it comes out. Why is that?
JD: Here's Vermont Gov. Phil Scott talking about that and his long-term opposition to any broad-based taxes.
Gov. Phil Scott: "We want to learn more about the initiative. I think that we have to be objective about this. But my feelings haven't changed on a carbon tax, and if this is all it is, is a carbon tax, then and I'm not supportive of that."
JD: So we have Gov. Phil Scott, you know, he's got people at the table. He's got substantial staff resources dedicated to this. The deputy secretary, natural resources, somebody from our energy office. But he's withholding judgment on the implementation phase, so to speak. He definitely is interested in lowering greenhouse gas emissions regionwide, but he doesn't want to have Vermont consumers pay a lot more. And in particular, he doesn't want, you know, a taxing environment. And I don't think this would happen in the TCI framework and not one just across the river in New Hampshire.
NHPR will be working closely with other stations in the New England News Collaborative to cover the initiative as it develops.