The state of Hawaii could be the first state to enact a tax on carbon emissions.
A carbon tax proposed by democratic state senator Karl Rhoads was recently passed by the Senate. The purpose of the bill is to assist in mitigating climate change by significantly reducing the carbon dioxide emissions that occur from the combustion of fossil fuels.
“The most effective single means of reducing greenhouse gas emissions is to ‘put a price on carbon’,” Senator Donovan Dela Cruz states.
Senator Rhoads noted that the proposed carbon tax is “intended to raise the prices of fossil fuels.” This is to reflect the estimated costs to people across the state and the nation that will be incurred from the impacts of climate change.
While no dollar figure for the tax has been specified, the bill would take effect in 2021, with graduated increases every three years until 2030. The new tax is planned to be paid by wholesale distributors of fossil fuels, but could be passed on to retailers, utilities and consumers.
Revenue generated by the carbon tax is intended to go into six special funds for the sole purpose of securing energy and environmental response.
Though the action being taken by the state is not enough to prevent disaster, other states that are considering of introducing a carbon tax may be encouraged to enact such taxes as well. If enough states do so, the collective impact of those actions can largely compensate for the continued inaction of the federal government.