Energy & Environment

Oil companies join blitz for carbon tax

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A number of oil-and-gas giants are taking part in an effort to encourage lawmakers to pass a national carbon tax, splitting with industry trade groups.

The campaign brought representatives of Exxon, BP, Royal Dutch Shell and Mobil Corp. to Capitol Hill on Wednesday, part of a broader coalition involving 75 Fortune 500 companies.

The effort was the largest gathering of businesses on Capitol Hill to advocate for climate legislation in over a decade, according to Ceres, a sustainable investment group behind the effort. The companies involved jointly represent more than $2.5 trillion in market valuations and over 750,000 U.S. employees.{mosads}

The CEOs representing companies ranging from ski outfitters to dairy farmers argued that the effects of climate change were already being seen on their bottom lines. They argued a carbon price was the only market-driven route to solve U.S. emissions.

But the involvement of fossil fuel companies in pushing for a carbon tax garnered the most attention.

For those businesses, a carbon tax allowing the continued use of fossil fuels is preferable to progressive plans that seek to put tougher regulations in place or move away from using oil and gas altogether.

The involvement of fossil fuel companies in the new push is primary due to foreign based oil and gas companies who agree with the international consensus for climate action, one lobbying source told The Hill.

“Historically the refiners have been against things like a per barrel fee, a carbon tax, and a border adjustment tax on imported crude. Now you have a large push led by the foreign headquartered companies to be more forward thinking on climate matters,” the source explained.

That could also pose a challenge for larger industry trade groups, many of which have long resisted calls for a tax on carbon emissions.

One major fossil fuel group though absent from Wednesday’s lobbying blitz is the American Petroleum Institute, with over 600 members. The group has struggled with how to address the issue of climate change for its members.

“Surely an association like API knows exactly how they would craft a carbon tax if they wanted to,” the source said. “But I’m not sure how they meaningfully engage in that process with a divided membership.”

Ben Marter, API director of communications, told The Hill that the group is meeting climate change “head on” in other ways.

“Our industry is meeting the climate challenge head on, driving carbon emissions to their lowest levels in a generation. API evaluates specific legislative proposals with an eye to reducing emissions while delivering reliable and affordable energy for all American families,” he said.

Many of the fossil fuel groups that do support a carbon fee sit on the Climate Leadership Council, a group that is advocating for a $40-per-ton fee on carbon emissions that would rise over time. Under the plan, revenue would be collected by the government and redistributed back to citizens in the form of a dividend.

A new poll paid for by the Council released this week, found that 66 percent of those polled supported the Carbon Dividends plan. That includes 80 percent of Democrats and 53 percent of Republicans.

This week, BP and Shell pledged $1 million over two years each in financial support for the plan. EDF Renewables pledged $200,000.

Those moves have received praise from supportive lawmakers.

Rep. Francis Rooney (R-Fla.), a co-sponsor of carbon tax legislation in the House, applauded BP and Shell for donating to the council. Rooney teamed up with Rep. Ted Deutch (D-Fla.) to re-introduce a bill in January.

“Any and all industry support for pricing carbon is a welcome development,” Rooney told the Washington Examiner on Tuesday. “These major oil companies have important voices in the future of energy. I would also like to see these companies engage in direct advocacy for pricing carbon.”

Wednesday’s blitz on Capitol Hill highlighted the growing support among different industries for a carbon tax. Representatives of Microsoft, Pepsi, BP and others held day-long meetings with House and Senate lawmakers on both sides of the aisles to share their support.

“We’re very grateful for a lot of the work going on on a state and local level. But we need federal action to create a ton of new economic growth,” said Hugh Welsh, President of DSM North American.

“I think we can speak for all of us here that we need action on climate change from Congress and a meaningful price on carbon.”

“I’m here as a business leader. I’m here as a father of daughters who are determined to create an incredible place for future generations, and I’m here as a citizen– to put a tax on pollution and those polluting,” said Joey Bergstein, CEO of Seventh Generation. “This issue is a really urgent one. The facts are really clear and frankly indisputable.”

Among those at the Capitol was the CEO of a ski company.

“We are in the front line, in the trenches,” said Francois Goulet, CEO of Rossignol Skis. “I live in the mountains, so I witness every day the impact of climate change, and the casualties we see from loss of revenue from manufacturers and retailers.”

In Congress, Democrats have said that a carbon price is needed to fully curb the current rate of emissions in the U.S. Lawmakers have put forward a handful of bills, though none have gained serious traction.

Sen. Chris Coons (D-Del.), who hosted the event with the CEOs, said climate change “is not just a threat to the future of business, but also is a real opportunity.”

Coons last year co-sponsored a bill supporting a carbon tax with former Sen. Jeff Flake (R-Ariz.), who retired after the last Congress.

“I think, and a number of my colleagues do, that supporting a carbon price is an intriguing and compelling solution to climate change,” he said. “I frankly think that a lot of this conversation has to be pushing back on the false choice of combating climate change and growing our economy.”

Many Republicans though remain skeptical.

“A carbon tax is not the solution to address our environmental challenges,” Rep. Kevin Brady of Texas, ranking member on the House Ways and Means Committee, said at a hearing on carbon pricing last week.

With Republicans in control of the Senate and President Trump in the White House, the visiting CEOs acknowledged that passing a carbon tax before 2020 appears unlikely, but insisted they aren’t deterred.

“This is the answer that will be implemented once the country takes it seriously, said Jeff Eckel, CEO of Hannon Armstrong. “I’m not an optimist that government is the solution here, but that doesn’t mean we try to do things that don’t work.”

Tags Chris Coons Donald Trump Francis Rooney Jeff Flake Kevin Brady Ted Deutch

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