By itself, pricing carbon emissions cannot solve climate change. However, it is a powerful tool we must consider as part of our toolbox. As the national dialogue on carbon pricing advances, these principles guide FCNL’s advocacy.
Enact a Price on Carbon High Enough to Drive Reduction in Greenhouse Gas Emissions
The most important outcome for a price on carbon is the reduction of greenhouse gas emissions. The price should be high enough to help the U.S. shift to net zero emissions by 2050. To achieve this, the price must increase over time to be high enough to cause markets to shift toward cleaner energy. This price should be paid “upstream” at the point of extraction — at the well or the mine.
Leakage occurs when greenhouse gas producers move their operations to another country. An effective carbon price must ensure that heavily polluting industries do not escape paying the tax by moving operations overseas. This could be done through the implementation of a border adjustment tax or a similar mechanism so that it reduces and does not simply displace greenhouse gas pollution.
Reporting and Transparency
To ensure we reach emissions reductions goals, measuring, reporting, and verifying should take place at both the facility and the national level. This means measuring the emissions of each power plant, factory, or waste disposal site, as well as aggregating the data nationally to determine whether the emissions reductions goals are being met or not.
If the set price is not sufficiently driving down emissions, then the price should increase. For example, if the overall goal was an 80 percent emissions reduction by 2050, incremental short-term goals should be set at 2- or 3-year intervals. If these short-term goals are not met, the price would increase, until the overall goal is met.
Protect Vulnerable Communities
We encourage a collaborative bipartisan process that brings diverse voices to the table, including frontline and vulnerable communities.
The carbon price should follow a “polluter pays” philosophy and ensure that the costs are not borne by the most vulnerable. Vulnerable communities should be helped, not harmed, by the policy.
Specifically, we’ll look to see how the policy impacts communities of color, rural communities, Tribal nations and indigenous communities, undocumented persons, those who are disabled or struggling with chronic health conditions, those most at risk from climate impacts and extractive industries, those not living in the wage economy, and those living in poverty.
Invest in an Affordable Clean Energy Future
Revenue from a price on carbon should also be invested in clean energy research, development, and efficiency. This will drive emissions reductions, while creating green jobs and stimulating the economy.
FCNL believes regulations are a necessary and vital tool to reduce U.S. emissions. If legislation includes a regulatory moratorium, there must be an environmental integrity mechanism to ensure that if the carbon fee isn’t working to effectively and quickly reduce emissions, the moratorium is lifted.
Dialogue and Process
Enacting a price on carbon would be a big step forward in environmental stewardship. We recognize crafting this legislation requires good-faith negotiations and compromise. We encourage a collaborative bipartisan process that brings diverse voices to the table, including frontline and vulnerable communities.
While there are many ways of achieving our desired outcome, we believe that these principles should be addressed in carbon pricing legislation. At FCNL we will always look for ways to support laws consistent with our values and our grounding as people of faith.