Climate change and the oil and gas industry
Letter by Jim Probst to State Journal, Charleston, WV, August 20, 2015
I am writing today in support of an approach to addressing greenhouse gas emissions that you may be surprised to learn is also supported by ExxonMobil.
That proposal is for a fee to be placed on the carbon content of fossil fuels, with the monies collected 100 percent rebated to American households in equal shares, also known as revenue neutral fee and dividend. The specific proposal that I advocate for is one put forth by the group Citizens’ Climate Lobby.
It calls for a steadily increasing fee, starting at $15/ton of carbon content, to be assessed at the point that the fuel enters the marketplace. This fee would increase at a rate of $10/year. By giving the fees collected back to households, consumers would be able to pay for the higher cost of goods and services. As the fee goes up, so does the amount of the dividend so, over time, low emissions energy production will be more desirable in the marketplace and will drive innovation and create millions of new jobs.
CCL’s proposal also calls for a border adjustment so that goods coming into the U.S. from countries that are not placing a fee on their carbon emissions will have a fee assessed when their products enter the country, which will serve to level the playing field and encourage other countries to also place a fee on their emissions. I would like to quote from a report on ExxonMobil’s website where they address the type of policy that they would support.
They say it should:
•Promote global participation,
•Let market prices drive the selection of solutions,
•Ensure a uniform and predictable cost of GHG emissions across the economy,
•Minimize complexity and administrative costs and
•Maximize transparency.
They go on to say that, “We believe that a properly designed, revenue neutral carbon tax is a more effective policy option for imposing a cost on carbon than cap and trade schemes, regulations, mandates or standards.
All of these goals would be met by CCL’s fee and dividend approach.
In a study commissioned by CCL by the research firm Regional Economic Models, it was found that a steadily increasing fee on carbon emissions would result in the creation of 2.1 million jobs over the first 10 years with 2.8 million jobs created over a 20-year span. CO2 emissions would be reduced 33 percent after 10 years with a 52 percent reduction after 20 years; 13,000 lives would be saved per year after 10 years with 227,000 lives saved over 20 years from reduced emissions. There would also be a $1.375 trillion increase in gross domestic product over the first 20 years of the plan.
To quote from ExxonMobil’s climate policy discussion, “Society continues to face the dual challenge of expanding energy supplies to support economic growth and improve living standards, while simultaneously addressing the societal and environmental risks posed by rising greenhouse gas emissions and climate change.”
I think that much the same can be said for the oil and gas industry in West Virginia, where producers here can either decide to be proactive, and work to reduce their greenhouse gas emissions, and get out ahead of the realities they are facing, or wait and have their futures decided for them, as in what is happening with the coal industry and the Clean Power Plan.
>>> Jim Probst is the West Virginia director of Citizens’ Climate Lobby. He lives in Hamlin, WV.
>>> See also: www.FrackCheckWV.net
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