Oregon’s legislature is currently deliberating House Bill 2020, the so-called Clean Energy Jobs bill that would cap carbon emissions in the state. This bill is well-crafted, the basic policy tool has already been tested elsewhere, and it represents both the right thing to do and a prudent path for the state. Most of all, and perhaps least discussed, it could help Oregonians unleash substantial economic opportunity, and do so with a sense of fairness for both urban and rural populations.
First, the bill’s big picture. HB 2020 is an Oregon version of California’s AB 32, the landmark cap-and-trade legislation. It will cap total greenhouse gas emissions, auction permits for the right to emit, and use those auction proceeds to invest in an equitable transition to a low-carbon economy. Yes, political forces have pushed and pulled at the legislation, with some annoying and inevitable exemptions and loopholes. But the substance has held, and based on California’s experience, the policy will deliver its intended outcomes of decarbonizing the economy and helping people through the transition.
Much of the discussion of the bill has focused on the impacts on rural communities, especially on gasoline prices. Unfortunately, that discussion has missed the boat in three important ways. First, if we’re going to think about gas prices, let’s be clear about the economics of petroleum from an Oregon perspective: It is all imported, and our dependence is a burden on the state’s economy. When we shift away from fossil fuels to regionally produced biofuels or renewable sources of electricity, we are becoming more economically self-reliant.
Second, much of the opportunity is rural. Most of the activities that could profit by sucking carbon out of the atmosphere are inherently rural, such as forest management for carbon sequestration and feedstock production for biofuels. Furthermore, the best places for additional wind and solar capacity are overwhelmingly rural. Indeed, the non-partisan economic analysis of HB 2020 suggests that employment will rise in every Oregon county. Rural populations could well face slightly higher prices at the pump and still come out ahead due to new sources of jobs and revenue.
Third, impacts on rural communities matter, but should not have disproportionate sway. Over 80 percent of the state’s population is now urban, and a similar share of the state’s population in poverty is, too. This bill has numerous spending mechanisms to ensure a just transition for both urban and rural populations. While it’s true that investments in transit and multi-family housing will mainly help cities, that’s appropriate because that’s where most of the people are — including most of those needing help through an economic transformation.
The “just transition” elements of the bill deserve particular emphasis. The recent opinion from this newspaper repeated the same tired talking points from the bill’s adversaries, worrying about businesses passing “costs along to regular Oregonians” in a way that would “hit the people least able to pay.” Yet the editorial failed to acknowledge HB 2020′s mandated reinvestment to address rural populations, low-income populations, tribes, energy-intensive industries and other impacted communities. California, with a similar designation for the use of auction revenues, has demonstrated how well this can work. Indeed, California’s economy has boomed while the state’s climate law has remained extremely popular.
HB 2020 deserves our support, but it also deserves scrutiny in the home stretch. I encourage you to contact your legislators to express support for the bill, as it remains the best chance yet for Oregon to join climate leaders around the world with strong policy action on one of the great challenges of our time.
I also hope you will tell your legislators to stay strong as the final version takes shape. The final bill must continue to include a hard cap on emissions and ensure a just transition for impacted communities and industries. The journey to Oregon’s low-carbon economy begins now, and we must make sure everyone is strapped in securely for the ride.
Joshua Skov, a longtime Eugene sustainability advocate, is faculty in the Lundquist College of Business and the Center for Sustainable Business Practices at the University of Oregon.
This post originally appeared as a column in the Eugene-Springfield Register-Guard.