TCI Regional Policy Design Stakeholder Submissions

We know that reductions in emissions from the transportation sector are essential if we are to lower the threats posed by climate change. We also know that emissions reductions are considerably cheaper than suffering the increases in damages that inaction brings. Further we know that the longer we wait to lower those emissions, the higher the cost will be. As someone who has studied these kinds of systems for my entire career I know of no more cost-effective and fairer approach than this type of system. I look forward to reading the comments of those who propose an alternative system capable of achieving achieve similar emissions reductions that can be demonstrated to be both fairer and more cost-effective than this proposal.

We need a safe, clean and reliable train system in Maine. I would much prefer to ride on a train in order to go to Boston for medical and transportation connections than make the 5 hour drive to Boston. The same can be said for a trip to Portland or for even going to places like Quebec, Toronto, Buffalo, etc. Riding on the train would be much safer and pleasant than driving, using unnecessary gas and requiring much more infrastructure maintenance. Reducing the number of trucks by putting the trailers on a train would reduce fuel pollution, make the highways safer and reduce wear and tear of the roads.

I am submitting comments for you to consider as a resident and taxpayer in Connecticut to express my concern about the potential that a cap and trade program will have on our customers, employees, business and the environment.

The plan seems to be geared toward converting millions of gasoline and diesel-powered vehicles to electric vehicles (EVs).

While EVs may be an apparently attractive way to lower emissions, we urge that greater consideration needs to be given to a number of factors that will have an impact on jobs, the economy, property values, electric reliability, emissions and family-owned businesses.

Please consider the following points and recommendations so that they can be incorporated into the final draft of the TCI:





•​TCI needs to be very cautious about advantaging regulated electric monopolies that already benefit from antitrust protection and a guaranteed rate of return. According to the website Utility Dive (https://www.utilitydive.com/news/california-new-england-will-significantly-miss-2050-carbon-targets-at-curr/564726/), "Just to meet this load that comes from electrifying transportation and buildings, you have to add an electricity sector that's equal to the current electricity sector" – which is a huge gift to utility investors. Are utilities doing such a great job that they deserve these government handouts (Eversource is rated below California’s PG&E in 2019 by the American Customer Satisfaction Index)? Our business cannot compete with utilities coddled and protected by government unless, we get equivalent protection and subsidies to create a level, competitive playing field.

•​With the goal of putting million’s EVs on the road, TCI should have ISO New England and the other grid operators fully evaluate the impact that this would have on the electric grid. An article published by the Massachusetts Institute of Technology (MIT) indicates that one EV can consume as much electricity as a home does. And as noted, we need to double power generation to meet the state’s carbon goals, an unlikely feat that will result only in supply shortages. The unintended consequence of the government heedlessly jumping onto the EV bandwagon will be rolling blackouts, with power loss to critical infrastructure such as schools, businesses, emergency responders, hospitals and nursing homes.


•​The ISO’s should add to their evaluation the impact of state policies promoting electric heat pumps on the electric grid, which could require an additional 17 million MWH of power annually. TCI must understand the impact that their program has on other initiatives also looking to utilize more electricity. TCI is not operating in isolation and has the responsibility not to operate in the dark either, and ensure that electric reliability is not compromised.

•​Although EVs are considered a low- or zero-emission vehicles, they are only as clean as the electricity that charges them. Connecticut is heavily reliant on natural gas to generate electricity and becoming more dependent on it as nuclear generation in the region is retired. Natural gas (methane) is more than seventy times as potent a greenhouse gas than carbon dioxide, and combusting natural gas also emits carbon dioxide. According to the Department of Energy, an EV produces 4,362 lbs of CO2e per year (https://afdc.energy.gov/vehicles/electric_emissions.html)– that’s almost two tons – hardly emissions-free, and that doesn’t even consider the CO2 resulting from their manufacture. TCI needs to fully understand the lifecycle impact of EVs and the source of the fuel that electricity is being generated from before EVs are designated as “clean”. It is intellectually and environmentally dishonest to claim that electricity is clean when ISO New England today (10/29/19) reports that just 8% of electric generation is renewable and 53% is generated with natural gas. Methane’s impact on climate change is an inconvenient truth. A recent study commissioned by the Connecticut Chapter of the Sierra Club (https://issuu.com/ctsierraclub/docs/hartford__ct_mobile_methane_leak_su) found that in Hartford, CT alone, gas pipelines leak approximately 43,000 cubic feet per day, or 313 metric tons per year. That is equivalent spilling and not cleaning up 320 gallons of diesel per day (or 117,000 gallons per year). Just because you can’t see natural gas leaks, it doesn’t mean that they are not there and that they are not doing environmental damage. According to Gale Ridge, PhD, a scientist and researcher on the Sierra Club study, “In a one month period, we found about 700 leaks in Hartford. Over a one-year period covering the same area, PURA reported 139 leaks. Even recognizing that some of the leaks we found are known to PURA, that’s about a 5-fold difference. We believe that CNG may be missing a large percentage of its leaks.”

•​Connecticut motorists are already paying the highest gasoline taxes in New England and the 11th highest tax in America. Connecticut also has the highest diesel tax in New England and the 9th highest tax in America. Any proposal that increases the cost of fuel in our state will disproportionally harm low-income motorists and businesses when compared to states that do not participate in TCI. According to the Natural Resources Defense Council "Low-income, households of color, multifamily and renting households spend a much larger percentage of their income on energy bills than the average family." An across-the-board energy tax is therefore "regressive," i.e. "African-American and Latino households and renters in multifamily buildings who pay a disproportionate amount of their income for energy" will be greater impacted by such a tax than average- or high-income earners. Moreover, low-income families will have less means to change their energy use to lower-taxed fuels, which are prohibitively expensive to convert to. TCI needs to consider the impact of their program on low- and fixed-income families who will not be able convert to EV’s.

•​Presumably, the purpose of TCI is to change consumption behavior in Connecticut and the region. But we’ve seen huge variations in energy commodity prices that haven’t affected consumption. EIA, for example, shows that gasoline consumption in Connecticut in 2015 was the same as in 2011, despite prices being more than $1/gallon less. Energy consumption is inelastic. Even if TCI is successful in increasing cost of fuel, the data clearly demonstrate that people will be paying higher prices for fuel and not curb consumption. Further inflation will result as the price of every product sold in Connecticut increases as merchants and manufacturers increase prices to account for TCI. Either that, or people will vote with their feet and leave the state or region.

Finally, even if TCI resulted in changes in consumption behavior in Connecticut, such changes will have no impact on climate change. As reported in U.S. News & World Report, the Intergovernmental Panel on Climate Change (IPCC) Assessment Report claims that even if the U.S. as a whole stopped emitting all carbon dioxide emissions immediately, the ultimate impact on projected global temperature rise would be a reduction of only about 0.08°C by the year 2050. China and India will dominate global carbon emissions for the next century, and there’s little the U.S., let alone Connecticut can do, to affect this. A Princeton University study likewise predicted that even if all countries stopped emitting CO2 entirely, the Earth would continue to gradually warm, before cooling off.
I ask that TCI take all of these issues into consideration before they decide to move forward.

I strongly support strategies to reduce our carbon footprint and improve the lives of Mainers through actions to improve public transportation options. In the midcoast, we have almost no public transportation options, with only a very limited local option. This makes everyone reliant on their car, which keeps us pumping out pollutants that are affecting our global climate. It is wise to work with our neighboring states and communities on a regional, bipartisan solution to provide clean, affordable, and accessible public transportation to our communities. Applying a “cap and invest” approach to transportation, as was used in the Regional Greenhouse Gas Initiative, would help Maine redirect some of the $5 billion a year we send out of state to fossil fuel companies into our local communities and sustainable transportation solutions.

As currently proposed, TCI would result in a potentially significant effective tax on highway gasoline and diesel. This would increase costs for manufacturers, retailers, dairy, forestry, mineral, and other businesses dependent on highway transportation for moving supplies and goods, as well as construction and other contractors dependent on vehicles, both through direct costs and the cost of transportation service providers.

Unlike residential drivers, who might respond to higher costs by adjusting driving habits and potentially converting to more efficient vehicles, and for whom states could fund programs supporting such changes with revenues allocated from TCI, the commercial transportation noted above is already driven to be as efficient as possible in terms of both logistical planning and transportation technology owing to regulatory requirements and the high costs of transportation generally, compounded by the competitive pressures businesses already face.

Without meaningful options to reduce exposure to the effective tax impact of TCI through behavioral or technology changes, or options for states to fund programs supporting such changes with revenues allocated from TCI, this cost impact could only be mitigated by moving production or operations out of the impacted region, or businesses would be left facing the consequences of trying to absorb or pass on costs to consumers.

TCI would therefore appear to promise little if any change in commercial transportation carbon emissions unless produced by reduced business operations, with resulting loss of employment and economic activity. This would be both fundamentally inequitable and highly cost ineffective.

The most efficient way to address the concerns outlined above while proceeding with TCI would be to exclude diesel from the program and focus on highway gasoline and related transportation issues and opportunities. This would protect the overwhelming majority of commercial transportation, and states could still work to assist businesses with smaller, gasoline fueled vehicle options.

Nevertheless, even focusing on highway gasoline could still lead to other economic and social consequences, particularly in rural areas. These potential consequences should be fully explored, explained, and opened to public review and comment before states take formal steps forward on the TCI proposal.

Dear TCI Team,

Our Climate is so grateful for your hard work to expand regional carbon pricing to a new sector of the economy and to do so in an inclusive, collaborative, bipartisan manner. On the whole, we stand by the comments submitted by the larger Massachusetts Campaign for a Clean Energy Future, particularly their two fundamental values that a carbon price must be science-based and equitable. However, we’d like to note several additional areas of concern:

1. Both the current TCI draft and the Massachusetts campaign document refer to RGGI as an effective precedent to emulate in several ways. We would like to reiterate that, for all the revenue RGGI has generated, we have yet to find a single economist who argues that the RGGI price ($5.20/ton at the Sept 2019 auction) has been high enough to drive the emission reductions needed to mitigate the climate crisis. This argument is further spelled out in this article from Vox <https://www.vox.com/science-and-health/2017/2/28/14741384/rggi-explained>

When it comes to setting a cap, we think TCI should set an aggressive maximum of carbon neutrality by 2050, with interim targets of 45% emission reductions by 2030 that all participating states must adhere to. States can then individually choose to be more ambitious if they wish, but we must provide states where industry is strong the legal mandate to fight the climate crisis.

We are also very concerned about the language around “cap flexibility” and “set asides.” A responsible system must plan for what history has taught us--that industry will fight tooth and nail to dodge its financial responsibilities. The MA campaign critiques on limiting cap flexibility and banking of permits are correct but don’t go far enough. In a climate emergency, we should not allow for flexibility, set asides, or banking, period. Industry must not be given wiggle room.

2. In MA, we are very proud of the design of H.2810 which uniquely proposes redistribution of 70% of its funds directly to families to financially equip them to make greener decisions. These rebates are weighted by income to ensure financial protections for the low-income communities most affected by climate change. This is the only carbon pricing bill to my knowledge that has received explicit support from Environmental Justice organizations in MA, and we must consider whether a progressive rebate structure is possible in TCI to ensure that no family is left in a difficult situation.

Meanwhile, our team in New York is quite concerned that New York Renews Coalition which just passed the CLCPA and is designing the CCIA, will face similar complications to MA. The careful work to build relationships with EJ communities for our state level prices does not seem to be transferring to the TCI process. This is partially why NY’s participation in TCI is currently tenuous.

In my previous commentary, I mentioned the concerns of our partners at the Climate Justice Alliance. Since that time, they have released another set of criticisms on use of Cap and Invest as a structure <https://climatejusticealliance.org/climate-justice-alliance-disappointed-disingenuous-policy-design-principles-proposed-transportation-climate-initiative-tci/>. TCI must provide specific allowances and guidelines for the equitable use of funds that it invests and will give local Green Justice communities the power to design a way to use those resources that meets their needs as they see them, not as the TCI administrators perceive them.


Thank you so much,
Our Climate

TCI I’m against this program and I feel that our government should practice what they preach it should start there,then present the numbers. Have All government officials use public transportation and electric cars. We are not going to fix this with a tax. A tax will just give government more money to mismanage. Plus we contribute less green house gases then China.Europe and America contribute less greenhouse gasses then China ........ FIX CHINA. As a small business I’m still paying a delivery (gas fee) for every delivery I get that started when gas was over $4 per gallon and it was never removed from any delivery and our volume sales of gas didn’t go down. A small percentage of neighborhood people got rid of the gas guzzlers when cash for clunkers happened and that caused a shortage of used parts for older vehicles. I’m done ranting.

Plug In America supports the Draft Framework Proposal of the Transportation and Climate Initiative. We urge states to sign on to the Memorandum of Understanding as soon as possible to accelerate carbon reductions in the transportation sector.

We support the Equity goal of the Framework. Electric vehicles generally provide significant societal benefits, and not only to their drivers. These societal benefits include reduced emissions of greenhouse gases and criteria air pollutants and downward pressure on electricity rates (including for non-EV owners) through improved utility asset utilization. Additional programs specifically aimed at increasing the benefits to low- and moderate-income populations can include replacement of diesel transit buses with electric buses; battery assurance programs for buyers of used EVs; and, EV car-sharing programs in low- and moderate-income neighborhoods.

However, TCI is missing a key opportunity to advance equity through progressive funding of the program. If TCI were to incorporate aviation fuels, it would address a rapidly-growing source of greenhouse gas emissions while ensuring that the revenue flowing into the program is more progressive in its distribution. Higher-income individuals would contribute a larger share of the revenue if aviation fuels were included, and a lower share of the program cost would fall on low-and moderate-income populations.

We strongly encourage participating jurisdictions to include education and outreach programs for transportation electrification and other low-carbon options among their programs for the investment of proceeds. One of the biggest obstacles to transportation electrification is the lack of awareness among consumers of the suitability of the current vehicles and infrastructure for their transportation needs. Increased awareness will lead to increased deployment, which will lead to lower costs of electric vehicles.

With regard to the cap and allowance budgets, Plug In America believes that transportation electrification can continue to accelerate, enabling the TCI jurisdictions to achieve their emission reduction targets. The budgets should be stringent enough to provide some impetus for this technology transition. We recommend that flexibility and cost containment provisions not be so lenient as to negate the benefits of acting promptly to move to low-carbon transportation options.

The allowance auctions will provide one lever for reducing emissions from transportation, as the price mechanism drives companies and individuals to reduce the carbon burden of their transportation options. The investment of proceeds will provide another lever, enhancing the affordability, availability, or accessibility of low-carbon transportation options. We look forward to remaining engaged as the Framework develops into concrete policy.