Washington Gov. Jay Inslee on Monday unveiled a $626 million climate change policy wish list for the state legislature to tackle in its upcoming session.

The measures have the support of several key Democratic leaders, whose party controls both legislative chambers in Olympia.

The wish list includes massive decarbonization efforts in buildings down to 20,000 square feet in size. The second largest source of Washington’s carbon emissions — 23.4% — comes from heating residential, commercial and industrial structures. 

Another item calls for plans to help Washington companies keep up with foreign competition as they trim their emissions. Tax rebates for buying new and used electric vehicles are also proposed. Money will be sought for hybrid electric ferries.

State money will be sought to help restart a dormant aluminum smelter with equipment that produces lower carbon emissions than before, and to build a solar panel manufacturing plant in the middle of the state. Many other programs also are scheduled to be included in a group of bills that Inslee’s allies will introduce to the legislature.

None of those bills have been filed yet. The 60-day legislative session begins Jan. 10, 2022.

‘Jobs Program Like No Other’

At a press conference Monday, Inslee said the $626 million is already on the state’s financial books. “These are existing revenues,” he said. “There are no new revenue sources in the package.”

The governor’s calculations do not include potential income from the federal Build Back Better program being debated in Congress. “Whatever comes out of that, we will massage the numbers” Inslee said.

Inslee acknowledged that none of his prior spending proposals have survived the legislature unscathed, but he voiced optimism that most of this package will likely make it through. “This is a jobs program like no other,” said Inslee, who has contended for years that a green economy will lead to more jobs.

At the press conference, state Sen. Reuven Carlyle (D), chairman of the Senate Environment, Energy and Technology Committee, said he believes Democratic support will be strong. “We have a policy framework, and this package builds on that infrastructure.”

The bulk of that framework lies in three Washington laws.

One sets overall carbon-reduction targets of 45% below 1990 levels by 2030, 70% by 2040 and 95% by 2050. A law passed last spring ordered carbon emissions from gasoline and diesel fuel sold in Washington be cut by 10% below 2017 levels by 2028 and 20% by 2035. Transportation accounts for 45% of Washington’s carbon emissions. Another law passed last spring was the nation’s second cap-and-trade bill following a California law. 

Washington’s cap-and trade law would create a system to set total industrial carbon emissions annually, a cap that slowly decreases through the years. Large emitters would submit bids to the state quarterly in an auction for segments of that year’s overall limit and be allowed to emit that amount in greenhouse gases. Companies would be allowed to buy, sell and trade those allowances. Washington policy makers anticipate the auctions will raise several hundred million dollars that the state can allocate to various programs.

Rep. Mary Dye, ranking Republican on the House Energy and Environment Committee, argued that Inslee’s proposals are ineffective. 

“The governor’s proposal to decarbonize buildings, to get rid of the natural gas industry and retrain workers whose jobs would be eliminated from his policies would do nothing to reduce deadly, destructive wildfires and the smoke they emit,” Dye said in a statement. “The governor’s proposal to spend millions of dollars in rebates for electric vehicle purchases would do nothing to prevent flooding or address drought that threatens our farmers. …  Where are his proposals to address the top concerns he mentioned at the beginning of the press conference?”

The Details

The biggest planks of Inslee’s requested legislative package include:

• A push to have all new construction in the state “net zero ready” by 2034. “Net zero” in this context means a building’s heating sources result in no net carbon emissions. A 2019 Washington law allows the state to regulate the energy performance of buildings 50,000 square feet or larger. Inslee’s proposal would expand that regulatory authority to buildings down to 20,000 square feet.
• A bill to require that gas utilities submit decarbonization plans to the Washington Utilities and Transportation Commission every four years. These plans would include emission reduction strategies and how to support renewable hydrogen and electrification efforts.
• A call for the legislature to create a state climate office to coordinate all of Washington’s global warming measures.
• A $50 million allocation to tackle how Washington companies can compete with foreign competitors that don’t have to implement carbon emission measures. These industries include steel and aluminum production, pulp and paper mills, and food processors.
• A request to have tribal consultants advise on climate change matters, including early notification of ventures that would impact their lands and treaty rights. Inslee faced political blowback after vetoing that provision in the cap-and-trade bill passed last spring. 
• The creation of tax rebates for residents buying EVs. To qualify for the rebate, a person would have to earn less than $250,000 as a single tax filer, or a couple less than $500,000 as a joint household filer. The proposed rebates are $7,500 for a new vehicle and $5,000 for a used one. An additional $5,000 rebate would go to an EV purchaser earning less than $61,000 annually, which is 60% of the state’s median income. 
• Money allocated to build two 144-car hybrid electric ferries and to convert another regular ferry to a hybrid electric model.
• Appropriations to help restart the dormant Italco aluminum smelter in Whatcom County in northwestern Washington. The proposed restart would come with equipment that would trim carbon emissions below August 2020 levels, when Alcoa shut down the plant, leading to the loss of 700 jobs. Two unidentified companies have expressed interest in buying and reviving the plant. A political wrinkle is that most of Whatcom County is in a legislative district represented by two Democratic House members and Republican Sen. Doug Ericksen, a climate change skeptic who is the legislature’s leading opponent of most of Inslee’s environmental measures. Ericksen’s position is usually that environmental measures kill jobs.
• A state grant to help build a solar panel manufacturing plant in Grant County in central Washington.