Breaking News: Montgomery County Passes Nation’s First Carbon Tax

Hats off to the Montgomery County Council in Maryland for passing the nation’s first carbon tax.  Here is a copy of the legislation.  Below is a summary of the hearing by Clean Currents, a local clean energy business.  CCAN also has an official statement on this legislation.  Also, here is CCAN’s press release on the passage, which I’ve posted below the Clean Currents Statement.

Its official: today, the Montgomery County Council passed a carbon tax bill- the first of its kind in the United States! The bill, proposed by County Councilman Roger Berliner, taxes stationary emitters in Montgomery County that release more than one million tons of co2 into the atmosphere annually. Currently, there is only one such emitter- a coal plant owned by Mirant Corporation. At a hearing yesterday, Mirant Corporation officials spoke against the legislation claiming it would only lead to rate hikes for consumers. However, Councilman Berliner said the $5/ton tax would not have an impact on ratepayers for numerous reasons.  This amount is marginal compared to the profits Mirant makes from the facility. The tax revenues will go to funding clean energy and other programs that are facing funding cuts during tough budgetary conditions.

Amanda Duzak and Gary Skulnik, Clean Currents resident activists were at yesterday’s hearing supporting the bill and the testimonies of CCAN’s Mike Tidwell and other advocates. Also present at the hearing were a rowdy group of tea party protestors in support of Mirant. These protestors denied climate change was happening. However, when asked about Mirant’s stance on climate change, the Mirant representative could not deny it, creating a real rhetorical problem for the tea party protestors.

DC-Area County Passes Carbon Tax on Coal Plant in Absence of Federal Carbon Cap

TAKOMA PARK, MD (5/19/10)—A Maryland county bordering Washington, D.C., today passed a $15 million “carbon tax” designed to show that other counties and cities can – and should – move forward against coal in the wake of federal gridlock on global warming.

The Montgomery County Council voted 8-1 today to adopt the carbon tax. In a county of nearly one million people the tax will apply to only one entity: the 850 megawatt coal-fired power plant owned by Mirant Corporation just 40 miles from the U.S. Capitol. At least half of the money will be used to fund county energy efficiency programs. The local utility, Pepco, has said the bill will have no discernible effect on ratepayers. Mirant had spent the past two years lobbying against any kind of strong federal carbon cap.

“With this heroic vote in the D.C. suburbs today, the coal lobby might want to prepare for local actions across the country,” said Mike Tidwell, director of the Chesapeake Climate Action Network, which supported the bill. “Local power-plant taxes are legal and now necessary given the success of the coal industry in watering down and delaying real action on coal pollution in Congress.”

Mirant lobbied ferociously against the Montgomery County bill, obviously treating it as a national test case. The company brought in the Electric Power Supply Association to pressure the County Council. It also funded a broad direct-mail campaign, a telephone polling campaign, and a massive astroturf email effort in the county.

“While all of us here would prefer for there to be strong regional or federal standards, the truth is we don’t today,” said Councilmember Roger Berliner, chief sponsor of the bill. “And it is also true that local governments often take the lead on these issues, and as a result of those initiatives, there is a greater push for federal legislation. That would be a good outcome. But until then, we have the authority and we must use that authority on behalf of our taxpayers and the health and well-being of our residents.”

At-Large Councilmembers George Leventhal and Marc Elrich also led the fight for the county carbon tax

Cross-posted from: here

5 Responses to “Breaking News: Montgomery County Passes Nation’s First Carbon Tax”

  1. 1 ash_anderson May 20th, 2010 at 2:34 pm

    Great news, Matt! I posted this to my social networks because it is an important victory. If not only because FINALLY we can say “Carbon Tax” proudly and seriously, and make it happen.

    Chalk one up for the climate movement! Keep us updated on this.

  2. 2 nickengelfried May 20th, 2010 at 3:38 pm

    This seems like such a common sense idea: making the worst polluters pay for the transition to a clean energy future in tough economic times. I can only hope see it replicated in communities across the US!

  3. 3 Seeker Emerald Jul 8th, 2010 at 6:38 pm

    i’m not taking a side here, but to suggest that Mirant is somehow paying more becuase of this is akin to burying one’s head in the sand. Not a dollar passes through Mirant’s hands that does not come from the consumer. I’m not saying that this is right or wrong, just saying that Mirant does not really pay tax, they just collect it from consumers, and pass it to the Govt.

    If it costs more to run a business, the business raises prices. It is simple economics, and it cannot work any other way. There simply is no other alternative.

  4. 4 Matt Dernoga Jul 9th, 2010 at 5:04 pm

    The problem with simple economics is the lack of complexity!

    The reason you’re mistaken is that businesses also have a desire to be competitive. If a business raises its prices on consumers, consumers will choose to buy power from another company whose prices are lower. The reason Pepco(the company in Maryland that distributes energy by procuring it from companies such as Mirant) says there would be no discernible effect on ratepayers from the carbon tax is that if Mirant raised its electric rates to make up the $15 million difference, Pepco would choose to buy energy from a less costly source. Probably also a cleaner source that isn’t penalized as much as Mirant by the carbon tax. Maryland deregulated its electric industry in 1999 (utilities are no longer public), and while there have been many detrimental impacts from that decision, one benefit we’re seeing now is that more utilities are entering the market with more competitive prices, and in some cases cleaner energy. Consumers now have more choices.

    So in short, Mirant won’t raise its rates because it wants to keep selling electricity to residents in Montgomery County. If it raises them, Mirant will be dropped.

  5. 5 Rev. Michael McLain Oct 1st, 2010 at 12:15 pm

    Thank God that Montgomery County had the sense to move on this critical issue that is so very vital towards the good health of its people. We at the local level should take the welfar of our people to heart and stop waiting on big brother in DC to do for us what we should do for ourselves. When the bible speaks of “the least you have done unto them, you have done unto me” elected officals have a mo
    moral duty to look out for those who elected them.

    I want to thank God for Councilmember Roger Berliner for this bill, and Councilmemders George Leventhal, Marc Elrich for there sopport, and the local activists for there labor of love in working for the passage of our nation’s first carbon tax.

    I pray that your efforts will lead other counties, states, and finally our good old USA to this end.

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About Matt

I'm currently a graduate student pursuing a Masters in Public Policy with a focus in environmental policy at the University of Maryland Public Policy Program. I'm have a Bachelors of Arts in Government and Politics from of the University of Maryland College Park. I blog largely about politics relating to energy, and the environment. I'm the former Campaign Director of UMD for Clean Energy at the University of Maryland, and am still a member. My undergraduate time in college was full of climate activism including pressuring my university to commit to and finalize a climate action plan, petitioning to get the University School System of Maryland to commit to carbon neutrality by 2050, helping pass one strongest pieces of statewide global warming legislation in the country, pressuring federal leaders to pass federal climate legislation, and leading a campaign to push a green platform in our local city council elections while mobilizing students to vote in large numbers for candidates that supported it. On top of that, I'm a big political junkie. Currently, I'm the Campaign Director for Prince Georges County Council candidate Mary Lehman. During my time as an undergraduate, I wrote bi-weekly opinion columns for our college paper The Diamondback on college, statewide, and Federal issues pertaining to energy and environment. This isn't all my life though, just like err...90% of it! I'm a long distance runner, I love watching sports, I play poker etc...but there won't be much in this blog about any of that.

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