Managing Principal Susan Tierney Delivers Statement to the Oregon State Legislature on the Economic Impact of the Regional Greenhouse Gas Initiative

January 17, 2014

Managing Principal Susan Tierney presented to the Oregon State Legislature on the feasibility and implications of a clean air tax or fee in Oregon -- an issue being studied by the Legislature as directed by recent law in Oregon. Her statement, delivered to the Oregon House Interim Committee on Revenue on January 15, 2014, and the Senate Interim Committee on Finance and Revenue on January 16, 2014, was based on her co-authored report on the first three years of the Regional Greenhouse Gas Initiative (RGGI), a program undertaken by a ten-state group in the Northeast and Mid-Atlantic regions of the United States.

RGGI began in 2009 as an effort to reduce greenhouse gas emissions while generating revenue for participating states. In its first three years, 2009--2011, RGGI generated nearly $1 billion in state revenues while initially increasing wholesale power costs by less than one percent. Dr. Tierney has calculated that over time, the initiative will save consumers more than $1 billion on their electricity bills and another $170 million in avoided heating costs.

In Dr. Tierney's response to questions from legislators, she also encouraged Oregon to think about the study questions -- feasibility and implications of a clean air tax or fee -- in the context of the upcoming Clean Air Act requirements that will require states to develop a state implementation plan for how to reduce emissions of greenhouse gases from existing power plants. She explained that under the federal Clean Air Act, the U.S. Environmental Protection Agency will soon be issuing guidelines for states to use in developing their implementation plans, and states should use the flexibility afforded to them in this process to come up with innovative approaches.

Read Dr. Tierney's statement to the Oregon Legislature

Read Dr. Tierney's report, "The Economic Impacts of the Regional Greenhouse Gas Initiative on Ten Northeast and Mid-Atlantic States"