Leaders in the Americas Eager to Act

The Partnership for Responsible Growth believes that Northern Hemisphere carbon pricing coordination makes all the sense in the world. That’s why we approached the Aspen Institute in 2016 to encourage that widely respected organization to convene a meeting of representatives from Canada, Mexico, and the United States to explore opportunities. We lined up influential partners: the Carnegie Endowment for International Peace, the Woodrow Wilson Center’s Mexico Institute, and Columbia University’s Center on Global Energy Policy.

We co-hosted a two-day roundtable, featuring 40 policy experts, business people and political leaders from the three countries to address ways to integrate carbon pricing across the continent. In October 2016 the Canadian Embassy hosted a follow-up session that, like the first, was well attended and thought-provoking. But after the election of President Trump, the effort stalled. Our government’s lack of interest in this initiative blocked progress.

So we were heartened by an announcement December 12 at the One Planet climate summit organized by French President Emmanuel Macron. The heads of states and governments of Canada, Colombia, Costa Rica, Chile and Mexico; the governors of California, Washington; and the premiers of Alberta, British Columbia, Nova Scotia, Ontario and Quebec declared their “commitment to implement carbon pricing as a central economic and environmental policy instrument for ambitious climate change action.”

These leaders made five related commitments:

  • To apply a cost of carbon to guide public investment decisions in their jurisdictions, and encourage private companies to do the same through internal carbon pricing.  

  • To create the platform for cooperation on “Carbon Pricing in the Americas (CPA)” among their jurisdictions with the support from relevant institutions, partners and other interested organizations, to identify and work in opportunities to increase alignment of carbon pricing systems and promote carbon markets, in order to maximize climate action while ensuring real progress on reducing greenhouse gas emissions. This work will be built upon existing initiatives such as the Partnership for Market Readiness, among others.  

  • To collaborate to strengthen systems for measurement, reporting, and verification (MRV) of greenhouse gas emissions, as a necessary foundation for the coordination of carbon markets within the Americas and globally.  

  • To explore the development of common standards to ensure the environmental integrity of international market mechanisms.  

  • To strengthen international and regional collaboration and cooperation in an effort to share lessons and improve technical capacity of the public and private sector.

Washington Governor Jay Inslee (D) has already acted. On December 14 he proposed that the Legislature enact a carbon fee to replenish the state’s “rainy day” fund. Details of how it would be implemented are expected to be released by the governor’s office in January.

While it is encouraging that the governors of two large states joined in this announcement, the absence of the Americas’ most powerful nation is glaring. If our federal government insists on ignoring this vital collaborative effort, we hope other states will decide to take part. It should be apparent to the Trump administration that if our trading partners in the Americas move ahead with carbon pricing, as some already are, U.S. companies’ goods and services may find border obstacles that threaten their export prospects.

In announcing their coordinated effort on December 12 the leaders said they were motivated by “the importance of carbon pricing mechanisms, and specifically the development of regional and international carbon markets as useful and effective instruments for reducing greenhouse gas emissions at a lower cost, driving innovation, facilitating the transfer of clean technology, enabling fiscal reform, encouraging mitigation efforts across sectors guided by price signals, and promoting sustainable economic development.”

The pact made by these nations is the latest sign that the rest of the world is moving ahead on climate change. The longer that climate deniers drive this country’s policy, the farther behind we will fall. We urge business leaders to make a strong case to their representatives in Congress and to the White House that this deepening isolation will hurt us in many ways and that we need to enact a carbon fee to accelerate the transition to clean energy and maintain our competitiveness in international markets.