TCI Regional Policy Design Stakeholder Submissions

For the past decade, I have been deeply involved in developing concrete policy and investment solutions to address climate change in Vermont in a manner that can both contribute to our economy and ensure affordability for its citizens. I am an economist with 30 years experience in this field (20 at the World Bank), a core member of Governor Scott's Climate Action Commission, a member of VCRD's Climate Economy Action Team, and a Senior Fellow at the Energy Action Network (advising on the recent publication of "Cap and Invest: A Review of Policy, Design, and Models and their applicability in Vermont").

I say all of this because I do not come to this recommendation lightly. The decision to join TCI is a big one and deserves careful consideration. Having studied this question extensively over the past several years, not only in Vermont but also in a number of other jurisdictions, I can say unequivocally that joining TCI is the most fundamental way for Vermont to make genuine progress in meeting our energy, climate, economic and affordability goals.

TCI presents a unique opportunity to focus on the single greatest source of greenhouse gas emissions in Vermont, and the one that keeps GROWING - transportation - in a way that builds on the success of our nation's first successful Cap and Invest program (RGGI - started under Jim Douglas), and in a way that generates the revenue needed to invest in clean transportation solutions that focus on those who need it most. RGGI allowed Vermont to join others in the region to focus on dramatically reducing BOTH greenhouse gas emissions (by 40%) in the electric sector while ALSO reducing consumer costs. Vermont has strategically invested the revenues raised from RGGI, directing the $2 million annually into weatherization programs that help Vermonters stop wasting energy and save money. That is good for our environment, our economy AND for affordability. But it only covers the electric sector, which accounts for only about 10% of our overall GHG emissions. TCI would focus on the elephant in the room - our vehicles - which account for 44% of our emissions, and is growing rather than declining.

Importantly, by joining TCI, Vermont would not have to go it alone. Like RGGI, we would join others who have already committed to reducing their carbon pollution, thereby increasing the impact of emissions reduction AND the ability to generate revenue to invest in the systemic changes that need to occur in the transportation sector to improve access and electrification. In fact if we DO go it alone by NOT joining TCI, we would be putting ourselves in jeopardy by cutting off a substantial source of revenue that we desperately need to address fundamental issues of access and equity in transportation that we currently face.

Research shows that no jurisdiction (State, region, country) in the world has made the progress needed to reach significant GHG reductions without some form of either Cap and Invest or carbon pricing policy in place. By capping pollution, we can guarantee the pace at which our progress can be made, while allowing the participating entities to decide on their own how to reduce their emissions. When looking at successful examples of Cap and Invest in the US and Canada (e.g.,RGGI, California and Quebec), it is clear that each has demonstrated that a triple win is possible: reduced emissions, increased economic output (compared to non-participating jurisdictions) and revenue that can equitably accelerate the transition to a clean energy economy.

Finally, we all know that there are insufficient revenues available in our current budget to address the issues of access and equity in the transportation sector, and certainly not enough to electrify the sector at the pace needed to reach our climate goals. We continue to place our most vulnerable citizens - our children - on diesel-emitting schoolbuses every day, causing increasing levels of health issues and pollution. Our rural population has little to no access to public transit. Our low- and middle- income population cannot afford to switch to electric vehicles. TCI offers the possibility of generating additional revenues to address some of these critical issues while also reducing our collective climate pollution.

I am grateful for all the effort that Vermont has put into the discussions surrounding TCI so far. I am also grateful to the Scott administration for creating a Climate Action Commission which strongly recommended joining a Cap and Invest program for the energy sectors not yet covered by RGGI. Now is the time to act on all the important groundwork that has been laid. I urge Vermont to join others who are actually doing something concrete to make a difference for our future. We know this type of policy works. Please do it.

There is no doubt that climate change is the single biggest threat to our economy, to affordability, to our very survival. I notice the changes around me each and every day, and it breaks my heart to think of what we are leaving to our children. I hear them talking about how irresponsible it would be for them to bring children into this world, how they see the window closing in on them. We all know the time is short, and the time to act is now. So let's do it.