If you find this post interesting, you can sign up for the firm’s monthly newsletter here. Each month’s newsletter contains a roundup of blog posts and commentary on climate news, law, and policy.

Washington State Governor Jay Inslee is expected to soon sign the Climate Commitment Act, a law recently passed by the state’s legislature requiring the government to implement a “cap and investment program” by January 1, 2023. 

The program will cover three-quarters of the state’s emissions, meaning that once in place, Washington will become the second US state (after California) to price most in-state emissions. Collected program revenues will be allocated to a “climate investment account” to support Washington’s green transition.

(Note: the Regional Greenhouse Gas Initiative (RGGI) adopted by various northeastern states also prices emissions by means of a cap and trade program, but it only applies to electricity sector emissions.)

The saga leading up to Washington’s cap and invest program is long and impressively complicated, offering important lessons for future climate policy efforts. In 2016, the state saw a carbon tax ballot initiative fail after splitting the Left over environmental justice concerns. In 2018, a second carbon pricing ballot initiative - this time on a proposed program that united the Left - also failed, debatably due to overwhelming oil industry opposition spending. Following the two failed initiatives, Governor Inslee and other Washington environmentalists’ focus shifted to passing some form of carbon pricing in the legislature. 

After years considering other carbon pricing proposals, this latest one finally made it through Washington’s House of Representatives and Senate. 

The forthcoming program will reflect lessons learned along the state’s embattled journey to pricing carbon, with at least 35% of funds (and a goal of 40%) in the climate investment account directed to providing “meaningful benefits to vulnerable populations within overburdened communities”. The program will also be designed in such a way as to prevent electricity ratepayer costs from increasing.

It’s good news Washington will finally get its long-sought price on carbon. But the fact that the effort was so fraught and divisive in a solid blue, staunchly pro-climate state like Washington portends difficulties for future US carbon pricing efforts.