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Farm groups join opposition to Inslee’s cap-and-trade plan

Several Washington farm groups have joined a campaign aganst Gov. Jay Inslee's proposal to charge some companies for emitting greenhouse gases.
Don Jenkins

Capital Press

Published on January 5, 2015 10:26AM

Don Jenkins/Capital Press
Washington Gov. Jay Inslee outlines his 2015-17 budget proposal at a press conference Dec. 18 in Olympia. Inslee supports extending tax breaks for food processors, but other proposals are drawing criticism from farm groups.

Don Jenkins/Capital Press Washington Gov. Jay Inslee outlines his 2015-17 budget proposal at a press conference Dec. 18 in Olympia. Inslee supports extending tax breaks for food processors, but other proposals are drawing criticism from farm groups.

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An organization formed to oppose Washington Gov. Jay Inslee’s carbon-cutting proposal includes several agriculture groups.

The governor’s cap-and-trade plan would apply to at least 130 plants, including one fertilizer manufacturer and eight food processors, according to the state Department of Ecology.

The companies, which release at least 25,000 metric tons of carbon in a year, would bid for “allowances” to emit carbon. The bidding would start at $12.60 per metric ton, a floor price based on California’s experience with cap-and-trade, according to DOE.

“It’s another tax on ag,” Washington Farm Bureau director of governmental relations Tom Davis said. “There’s nothing we can do about what China is sending our way, so why would we cripple our industries?”

Factories in China produce large amounts of greenhouse gases, which are seen as contributing to climate change.

Legislators, motivated by concern about climate change, in 2008 mandated carbon reductions, but they have never passed a plan to achieve those cuts. Inslee says pricing carbon would get the state on track and, in the process, raise $1 billion a year for government programs.

DOE special assistant to the director Hedia Adelsman said the proposal is modeled after other cap-and-trade markets, such as California’s. “We are not pioneers. We are not the first,” she said.

In response, 19 business and labor groups formed the Washington Climate Collaborative, which criticizes Inslee’s approach to reducing carbon emissions.

On its website, the group says it’s “disappointing that the governor wants to step in and create a complicated government-run financial program to regulate carbon emissions by coercing Washingtonians, not collaborating with them.”

The group states that private and public investments in energy-saving technologies and efficiencies would be a better way.

Besides the state Farm Bureau, the Northwest Food Processors Association, Washington Association of Wheat Growers, Washington Food Industry Association and Washington Potato and Onion Association joined the collaborative.

Davis said Inslee’s proposal would hurt food processors and the growers who sell to them.

“There’s almost a religious fervor behind this proposal and that causes people to lose sight of the value of food production,” he said. “From a national security standpoint, it’s just short-sighted. These are not dirty industries.”

DOE released a tentative list of businesses that would be required to buy allowances.

The list included the Agrium Kennewick fertilizer operation; McCain Foods in Othello; Tyson Fresh Meats in Wallula; Basic American Foods in Moses Lake; ConAgra Foods Lamb Weston in Connell, Pasco and Richland; and J.R. Simplot in Moses Lake and Othello.

“Food processing takes a lot of energy. A lot of that is related to food-safety standards,” Northwest Food Processors Association government affairs director Ian Tolleson said.

He said companies already are looking for ways to cut power consumption. A government program taxing carbon “essentially increases the cost of packaging and processing food and increases food prices,” he said.

The governor’s proposal would apply to companies that are responsible for 80 to 85 percent of the state’s carbon emissions.

The program’s goal would be to make those businesses do their part to rollback the state’s total annual carbon emissions from about 92 million metric tons to 88.4 million metric tons by 2020 and to about 66 million metric tons by 2035.

The state estimates it would have roughly 74 million allowances to auction the first year. The number would gradually be scaled back to force emission cutbacks.

The state would hold back some allowances in reserve and release them if bidding drove up the price, according to the proposal.

A company could get allowances by investing in projects that prevent greenhouse gas emissions, including anaerobic digesters.

Manufacturers put at a “significant competitive disadvantage” in selling products overseas because of carbon costs would be eligible for tax relief, according to the proposal.



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