Carbon Pricing: A Big Move For a Small State


The fight against climate change is a test of human nature; it’s near-impossible to get people to do what is right for society when what is right is inconvenient. In order to make progress, we need to use financial incentives like a tax on carbon emissions, which would motivate people to use less gasoline, rely on renewables for home heating, and generally become more environmentally conscious. As a leader in progressive and socially conscious legislation, Vermont must be an early state to adopt this policy, for which there is already growing interest among residents; so far, over 500 Vermont businesses and institutions have demonstrated support for a carbon tax. Academic institutions are a major factor in this process, and Middlebury’s endorsement, given its image as a pioneer in carbon neutrality, would carry a lot of weight.

Vermont is largely reliant on other states for energy, with virtually all of its non-renewable energy coming from outside Vermont. This represents a hole through which Vermonters’ money is exiting local circulation; the environmental coalition Energy Independent Vermont (EIV) estimates that eight out of every 10 dollars spent on fossil fuels immediately exits Vermont.  Instead of seizing money from the hands of Vermonters, a carbon tax would actually return it directly to Vermont’s citizens.

In addition to combatting the climate-related threat to our existence on this planet, a carbon tax would actually stimulate Vermont’s economy by catalyzing growth in the renewable energy sector and keeping money circulating within the Vermont economy. Vermont may not have any natural gas reserves, but it does have the capacity to have a robust renewable energy industry. Already, Vermont’s renewable energy sector employs over 19,000 Vermonters and produces near nine million megawatts of power, according a report commissioned by the Vermont Clean Energy Development Fund in 2017.

Carbon pricing has bipartisan support, with everyone from Barack Obama and Justin Trudeau to Lindsey Graham calling for a tax on carbon emissions in various issued statements and press conferences. In Vermont, opposition to the tax has mainly been on the part of people like Governor Phil Scott, who is generally opposed to any new taxation, and Vermont fuel dealers. One such lobbyist, Matt Cota of the Vermont Fuel Dealers Association, expressed in an op-ed in the Burlington Free Press that a carbon tax would not be effective in Vermont because approximately half of Vermonters live near the borders of New Hampshire, Massachusetts or New York, where they could conceivably fill up on gas and dodge the Vermont carbon tax.

This sentiment rests on several incorrect assumptions. First, New York state already has consistently higher gas prices than Vermont. In addition, New Hampshire, Massachusetts and New York, along with five other states, are currently considering their own carbon tax legislation. More, the carbon tax would not be so extreme as to override convenience; if the plan heralded and introduced in January 2018 by EIV is enacted, Vermont’s carbon tax would likely manifest in a 40 dollar fee for each ton of carbon emitted. This would trickle down to the consumer in the form of a three cent per gallon of gas increase starting off, eventually rising to 36 cents per gallon over eight years (alongside proportional increases to diesel, home heating oil and propane prices). In addition, the stimulus to the local economy gained from keeping energy revenue in circulation with Vermont companies would prevent many people from going out of state to fill up on gas.

At this point in the legislative process, where there is widespread support for the general idea of a carbon tax but no specifics currently set in stone, there are many things that this carbon tax could become. Many legislators and activists aim to make the Vermont carbon tax redistributive. Daniel Barlow, of the Vermont Businesses for Social Responsibility, describes his ideal policy as one “that returns the [carbon] tax money in either tax breaks or dividends to low and moderate income families.”

This kind of redistributive policy counters some issues common to punitive taxes — mainly, that they disproportionately affect rural and low-income populations who have less access to renewables and environmentally-friendly amenities like hybrid or electric vehicles and solar panels. A redistributive carbon tax would permit rural and low-income Vermonters to cut down on their carbon emissions in the same way that wealthy Vermonters do.

Not everyone needs to be actively, constantly engaged in protecting our planet. Changes in policy can change the way we act and emit carbon in a significant way without major consequences or activity on our part. This legislation is necessary, and it is also tremendously accessible. All it needs is widespread and passionate support, and soon.

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