Carbon pricing in doubt as business support fractures

Carbon pricing in doubt as business support fractures Graphic by | Joan McGuire

The business community is more divided on carbon pricing than ever before.


In March this year, the business community gave a rare show of unity on environmental policy when a group of diverse business leaders, led by the Nature Conservancy and Merritt Paulson, CEO of the Portland Timbers and Thorns, released recommendations for decarbonizing Oregon’s economy.

The task force behind the proposals, which included lumber companies, utilities and manufacturers, laid out several strategies, including congestion charging, electrification of transit and water conservation.

The business leaders were united except on one crucial policy — carbon pricing, the linchpin of any effective strategy to reduce greenhouse gas emissions. 

It now appears the business community is more fractured on carbon pricing than ever before.

While the task force was open to putting a price on carbon, such as a carbon tax or cap and trade program, it differed on how to frame a strategy, and instead recommended further study on economic impacts.

The task force is effectively disbanded, having agreed solely to a one-year commitment. The Nature Conservancy is now coordinating with the state’s business associations to advance the recommendations.

But expectations that carbon policies will be advanced by these associations will no doubt be hampered by the pending merger of the state’s largest groups, namely the Associated Oregon Industries (AOI) and the Oregon Business Association (OBA).

It is unclear how the combined alliance of AOI members, which lean conservative, and the more liberal OBA, will stand on carbon pricing; but with AOI members taking a stance against a regional cap and trade or carbon tax, the lack of agreement will no doubt hamper progress of carbon legislation.

AOI did not respond to a request for comment by press time.

The lack of consensus has no doubt contributed to the floundering of the most recent cap and trade bill in the Oregon senate, which has been overshadowed by lawmakers’ efforts to pass a transportation bill.

Cathy MacDonald, director of policy and external affairs at the Nature Conservancy in Oregon, anticipated carbon pricing would be the hardest policy to achieve consensus on among business members of the task force.

Nevertheless, she said she is “hopeful” the newly merged AOI-OBA will provide perspective on the best design for carbon pricing.

“Any analyses that identify challenges for the best carbon pricing will get us down that path,” she said.

Several high-profile members of Oregon’s business community clearly back carbon pricing.

This week, Tom Kelly, president of remodeler Neil Kelly Company and the original founder of OBA, announced a new group he is heading — the Oregon Business Alliance for Climate.

Kelly, who has spoken out against the AOI-OBA merger, said in an email announcing the initiative that the new alliance “offers a unique and much needed voice for Oregon business leaders” to advance carbon pricing and economic solutions.

Despite this strong show of support, a unified voice on a framework is distinctly lacking.

Until one emerges, it is unlikely lawmakers will take any carbon legislation seriously, and with it the likelihood the state will meet its long-term, mandated greenhouse gas goals.     

For another approach, check out California's aggressive bipartisan initiatives to combat climate change. As the New York Times reports today, the state is becoming a de facto global leader in the emerging green tech economy.

Kim Moore

Kim Moore is the editor for Oregon Business magazine.

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