Local New York State Leaders Call for Carbon Tax

By Gerald B. Silverman

More than 150 local New York officials are urging Gov. Andrew M. Cuomo (D) and state lawmakers to tax carbon and methane to generate some $7 billion for investments in clean energy, according to a letter obtained by Bloomberg Environment.

The tax would be imposed on oil, gas, and coal companies and levied “as close to the source of pollution as possible, such as at the point of extraction for in-state fossil fuel production, on wholesale power purchase agreements, or point of importation of oil, natural gas, or other emissions sources into the state,” the letter said.

The signers include the mayors of Syracuse, Utica, and Nyack, Brooklyn Borough President Eric Adams, and 13 New York City council members.

While the prospect of a carbon tax passing the Legislature is uncertain, supporters are hoping that the backing of local officials will add momentum to their effort.

Legislation (A. 107, S. 2846) similar to the proposal is currently being reviewed in committees of each house. Cuomo has expressed support for climate change measures but has not taken a public position on a carbon tax.

The New York State Department of Environmental Conservation provided Bloomberg Environment with a statement it issued in October, but declined to comment further. Cuomo said the state would assess the proposal, according to the statement.

Political Challenge

Carbon taxes are politically difficult to enact, as seen recently in Washington state, said Kenny Stein, director of policy at the Institute for Energy Research (IER), a group that promotes free-market solutions to global energy and environmental challenges.

“Despite Democratic control, the legislature just indicated that it will be unable to pass even a slimmed down version of Gov. [Jay] Inslee’s proposed carbon tax,” Stein told Bloomberg Environment, referring to a bill that recently died in committee in Washington’s Legislature. Inslee is a Democrat.

“This follows on the heels of a carbon tax being defeated by statewide referendum in 2016" in Washington, he said.

The institute—and its affiliated American Energy Alliance—receives part of its funding from Koch Industries Inc. and opposes carbon taxes and cap-and-trade programs.

Karen B. Moreau, executive director of the American Petroleum Institute’s New York office, told Bloomberg Environment that reductions in carbon emissions are best achieved through greater use of natural gas and market forces.

Climate Leadership Council

Some fossil fuel companies, however, have expressed support for a carbon tax in some venues. BP Plc, Exxon Mobil Corp., and Royal Dutch Shell Plc are all founding members of the Climate Leadership Council.

The council supports a carbon tax, with proceeds returned to all Americans in the form of a dividend. It also supports the eventual phasing out of carbon emissions regulations.

Michael Bloomberg, founder of the global business, financial information and news leader Bloomberg L.P., is a founding member of the council. Bloomberg Environment is an affiliate of Bloomberg L.P.

The push for a New York carbon tax is being spearheaded by a coalition of environmental, labor, and community groups called New York Renews.