House Bill 2040, the Carbon Auction Rebate, was introduced by Reps. April Connors and Mary Dye of Washington State. The law proposes giving Washington’s 6.8 million registered vehicle owners a one-time fuel rebate check from the state’s $1.3 billion cap-and-trade carbon allowance auctions.
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CAR Bill Addresses Surplus from Carbon Auctions as Washington Drivers Face Gas Price Hike
This year’s cap-and-trade carbon auctions under the 2021 Climate Commitment Act were expected to raise $574 million. This year’s auctions netted the state $2 billion, exceeding expectations. Given the carbon tax’s financial impact on fuel prices, the CAR bill proposes distributing these excess monies to drivers.
The rebate may not fully offset rising gas prices, but Rep. Connors said it is a start. For two-car households, the rebate would be $360, paid by check in July.
Washington State gasoline prices have increased by nearly 50 cents per gallon due to the carbon tax. Mike Faulk, Gov. Jay Inslee’s spokeswoman, defended the carbon auctions by saying the monies come from the state’s largest polluters, who are now reducing their impact. In 2022, these companies produced $200 billion and are finally taking responsibility for their environmental impact, Faulk noted.
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Carbon Auction Rebate Bill Offers Relief for Washington Drivers Amidst Ongoing Carbon Tax Debate
Faulk said carbon auction proceeds could cover free transit for under-18s, heat pumps and cost-saving weatherization for low-income households, electric school buses, and Washington employment growth. He also highlighted that Governor Inslee’s 2024 supplemental budget includes a $200 power bill credit for low- and moderate-income households using Climate Commitment Act (CCA) money.
Importantly, the CAR law does not conflict with the CCA or affect previous Legislature investments made using CCA funding. The voter advocacy group Let’s Go Washington filed Initiative 2117 to repeal the cap-and-trade statute. If it receives enough validated signatures, the initiative will be presented to the Legislature and placed on the 2024 ballot if not passed.
The Washington State Legislature will hold its 60-day regular session on January 8 to tackle the CAR bill and carbon tax problems.
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