Our Climate is a network of students and young people deeply concerned about the future of our planet. As it is our generation and future generations who will bear the worst consequences of climate change, we believe that policymakers must take immediate steps to decarbonize our economy. This week, Representatives Ted Deutch (D-FL), Brian Fitzpatrick (R-PA), John Delaney (D-MD), Francis Rooney (R-MD) and Charlie Crist (D-FL) introduced H.R. 7173 the “Energy Innovation and Carbon Dividend Act” (EICDA) into the House of Representatives. Another Republican, Dave Trott of Michigan, has also co-sponsored the bill. The bill establishes ambitious pollution reduction goals and charts a viable path forward for the U.S. to transition to clean energy. We are proud to support it.
In the current Congress, the only climate policies that are capable of passage are those with bipartisan support. This legislation is a momentous step in bridging the partisan divide and allowing policy to be considered on its merits. Our Climate applauds Citizens' Climate Lobby's persistent advocacy efforts, which facilitated the introduction of ECIDA.
The EICDA includes a carbon fee that starts at $15 per metric ton carbon dioxide equivalent emissions (MTCDE) and increases every year by $10 per MTCDE. The bill distributes 100 percent of generated revenue, minus administrative costs, back to households in the form of a monthly dividend. The bill also includes refunds for carbon capture and sequestration (CCS), narrow regulatory rollbacks, and exemptions for fuel purchased for agricultural uses.
Our Climate evaluates carbon pricing policy on four criteria. The EICDA aligns with these principles in the following ways:
1. Be strong and grow over time. The High-Level Commission on Carbon Prices estimates that a carbon price of $50-100 per MTCDE by 2030 across the developed world would align the global economy with a two-degree scenario. The proposed legislation should achieve a price of at least $125 per MTCDE by 2030. The goal is to reduce US emissions by 80 to 90 percent below 2015 levels by 2050.
2. Cast a Wide Net. While the EICDA covers greenhouse gases emitted from fossil fuel combustion, it exempts emissions from agriculture, methane leaks and industrial processes. It will be crucial to reduce these emissions and we believe that can be accomplished with complementary policies.
3. Be just and equitable. Economic models indicate that an equal dividend will be economically progressive, with the bottom ⅔ of income earners, on average, coming out ahead. This bill does not allocate targeted funds to communities most affected by climate change or this policy specifically (e.g. workers transitioning from heavily dependent fossil fuel industries). We believe it is crucial to have the voices of these groups represented, in this policy and others that are complementary.
4. Enforce a durable price. The price is durable and enforceable so that it actually changes the economic incentives. Bipartisan support for this policy ensures that it will withstand changes in the Administration, Senate and the House. The price will be applied upstream - where the emissions enter the economy - making it easier to enforce.
The Energy Innovation and Carbon Dividend Act would put us well on our way to achieving the emissions reductions that the climate crisis requires. To ensure a livable and just world, a diverse range of people need to continue important conversations about the various climate solutions that together would achieve the greatest emissions reductions, while ensuring vulnerable and frontline communities have the resources they need for a just transition. We recognize that no single policy will fully address the climate crisis, but the EICDA provides a viable and ambitious path to drastically reduce greenhouse gas emissions. Its passage would help protect our climate and save lives. We urge lawmakers to support it.