By Guy Page
The state of Vermont should tax fossil fuels to fund carbon reduction programs required by carbon reduction mandates, a Jan. 15 report by the Public Utilities Commission (PUC) recommends. Estimated annual revenue from three proposed revenue sources would total $78 million.
“Vermont is falling far short of its climate goals in the heating and transportation sectors, which represent the vast majority of our greenhouse gas emissions and the greatest cost burden for Vermont households,” the PUC report said. “Without a stable, sizable stream of public funding in those two sectors, Vermont will not meet its carbon-reduction commitments.”
The Public Utility Commission, the state’s ‘Energy Court,’ was directed by the Legislature to consider a new ‘all-fuels’ energy efficiency utility to do for thermal heat what Efficiency Vermont does for electricity: help Vermonters conserve energy through weatherization and other means. The PUC passed on that idea but did recommend raising revenue by taxing fossil fuels in three different ways:
- $20-40 million annual revenue from the regional Transportation Climate Initiative (TCI). This multi-state initiative would charge fuel wholesalers for ‘carbon pollution clean-up.’ The wholesalers would then pass this cost along to vehicle operators when they pull up to the gas or diesel pump.
- Up to $18 million annually from a Thermal Efficiency Benefit Charge on the sale of fuel oil, propane, and kerosene.
- $20 million from an eight-cent fuel tax increase.
The PUC report promises increased weatherization and transition to an electrified transportation will save Vermonters money in the long run. The Vermont Fuel Dealers Association seems less optimistic, especially with the likely impact on rural Vermonters heavily dependent on fossil fuels for heat and transportation.
“Vermont lawmakers should not support the regressive taxation of energy needed to heat our homes and power our vehicles,” a VFDA statement said. “Given that rural Vermonters depend on these fuels the most, these taxes will have the effect of taking from the poor and giving to the rich as the taxes paid by all will provide incentives for Vermonters with means to purchase new electric vehicles and heaters.
Read more of Guy Page’s reports. Vermont Daily is sponsored by True North Media.