Carbon initiative could cost Grant PUD

EPHRATA — A ballot initiative that would place a tax on carbon emission would cost the Grant County PUD at least $4.6 million per year at current prices for carbon offsets. And that amount would increase as carbon offset prices increase.

Carbon emissions are seen by some as a component of changing climate, and Washington residents will vote in November on an initiative that would impose a tax on emissions. Mike McClenehan of the PUD’s accounting division said state officials are working on a different plan, which would impose different operating costs in a different way. McClenehan estimated the “Clean Air Rule” would cost the PUD about $450,000 per year in its current form.

Whatever the actual facts of the case, regulators are looking at placing some kind of tax on carbon emissions, McClenehan said. Federal rules have been proposed, but have not been implemented due to pending litigation.

Commissioner Bob Bernd said commissioners should think about getting information on the impacts of the initiative out to PUD customers. “I think we want to continue to study the issue,” he said, and come up with a way to get information to customers “as the election gets closer and the arguments get more defined.”

“We should come up with a strategy as far as timing and a draft statement,” said commissioner Tom Flint. “I do think we have an obligation to our ratepayers” to inform them of the impacts, Flint said.

Most of the PUD’s power comes from hydro generation and would not be subject to taxes or the Clean Air Rule regulation. But the PUD sometimes buys electricity from other sources, and some of that would be subject to taxes or fees.

The carbon tax in Initiative 732 is supposed to be “revenue-neutral,” meaning taxes would, at least theoretically, be lowered somewhere else. If the initiative passed and the revenue-neutral provisions were implemented some of the costs to PUD customers would be offset, McClenehan said.

Bernd asked what happens if the county continues to grow and the PUD buys more power from outside the project. McClenehan replied that there are procedures in place that should keep those impacts to a minimum, at least for a while.

Cheryl Schweizer can be reached via email at education@columbiabasinherald.com.