Climate commission tables debate on revenue-generating measures

Maryland Department of the Environment Secretary Serena McIlwain during a February 2024 climate change news conference with Gov. Wes Moore (D). File photo by Bryan P. Sears.

A state commission is moving closer to suggesting that Maryland adopt aggressive revenue-generating measures to fund programs that confront climate change — but put off a decision Tuesday until next month, so members can evaluate the impact of the presidential election on state policymaking.

The Maryland Department of the Environment (MDE) late last year estimated that the state needs about $10 billion to meet its climate mandates. But as the Maryland Commission on Climate Change worked through several items during a three-hour meeting Tuesday, MDE Secretary Serena McIlwain, who chairs the panel, moved to table the debate on the revenue measures until next month's meeting.

"I think it's important to give us time to think through these really big items some more, especially when you think about what just happened in the election," she said.

The commission is putting the finishing touches on its annual list of recommendations for Gov. Wes Moore (D) and state lawmakers to consider for the state's ongoing attempts to meet aggressive climate mandates. The document — which is merely advisory, though often influential — is scheduled to be finalized on Dec. 12.

A working draft of the 16-page report includes recommendations that the state adopt three complicated and potentially controversial measures to pay for climate programs:

Authorizing a cap-and-invest scheme to make the transportation and building sectors pay for carbon emissions, similar to a 15-year-old program that generates revenues from the power sector through the state's participation in the Regional Greenhouse Gas Initiative ;

Establishing a fossil fuel transport fee and mitigation fund;

and making 40 large fossil fuel companies compensate the state for historic climate emissions and associated environmental degradation.

Moore administration hires consultant to help state brace for Trump administration

Although the governor and legislature aren't obligated to follow the recommendations advanced in the commission's annual report, McIlwain's move Tuesday suggests the Moore administration may be reluctant to embrace the most aggressive revenue-generating measures, even as the governor and administration officials tout their commitment to combating climate change.

"Climate action is not just a talking point for us," Moore said in a LinkedIn post this week. "Since Day One, we've invested in making Maryland cleaner and greener for generations to come, including the implementation of the Climate Solutions Now Act and Maryland Department of the Environment's Climate Plan."

McIlwain just returned from the United Nations' international climate conference in Azerbaijan, and said American officials were frequently asked about the U.S. commitment to reducing carbon emissions now that former President Donald Trump is heading back to the White House. McIlwain told her fellow climate commissioners that Maryland is among several states that have vowed to continue their climate work, in partnership with businesses, nonprofits, scholars and advocates, even if the federal government becomes an impediment.

"In Maryland we're continuing the fight against climate change ... together as one," she said.

A study released last week found that Maryland cut carbon emissions by 36% between 2005 and 2022 and by 42% per capita, making it the leader when it came to states reducing greenhouse gas emissions over that 17-year period. The Climate Solutions Now Act, passed by Maryland in 2022, mandates that the state reduce its carbon emissions by 60% by 2031 and be carbon-neutral by 2040.

Before the vote Tuesday to table the debate on revenue generators, Jennifer Laszlo Mizrahi, a climate commission member representing philanthropies, urged action, calling the measures "the most important three items we can move this year."

"Without these items, we can't have any action plan without the money," she said.

Earlier in the meeting, Dallas Burtraw, a senior fellow at the group Resources for the Future, urged the commission to recommend the cap-and-invest plan, saying it would generate proceeds for clean-energy investments and compensation to communities that have been battered by climate change "at the least cost."

Cap-and-invest, which has been adopted in California, Washington state and New York, auctions off pollution credits in many sectors of the economy. It creates carbon limits which are reduced over time, sets a price on carbon emissions and provides income for the state. The Regional Greenhouse Gas Initiative, the 10-state consortium that includes Maryland, only targets greenhouse gas emissions from power plants. Maryland has received about $1.3 billion in proceeds from these auctions dating back to 2009.

Some good climate news, for once: Md. leads in carbon emissions reductions

The climate commission draft proposal envisions using 20% of the cap-and-invest proceeds on home energy, efficiency and electrification efforts; 20% on electric vehicles and transit, 20% on making commercial, institutional and multifamily buildings more climate-friendly and energy efficient; 20% on programs that reduce greenhouse gas emissions in infrastructure; 10% to support tree plantings, forest management, wetland management, soil management, and other projects that store carbon; 9% on program administration for state agencies that run climate programs; and 1% on public awareness campaigns.

The proposal to create a fossil fuel transport fee and mitigation fund was included in legislation that was introduced during the 2024 General Assembly session but ran aground in a House committee. The bill would have imposed a fee on companies that transport fossil fuels through Maryland, especially targeting companies that transport coal by train.

The climate commission estimated that the measure would generate about $300 million a year for a mitigation fund, with the money distributed this way: 23% for home energy efficiency and electrification; 23% for carbon reduction measures in commercial, multifamily and institutional buildings; 23% for electric vehicles, charging equipment and electric school buses; 20% for mass transit; 2% for asthma treatment for communities affected by coal dust; 9% for program administration; and 1% for public awareness.

The final revenue proposal from the climate commission would be to adopt a measure that requires the 40 largest international fossil fuel companies to pay a one-time fee for historical climate damage, based on the pollution their facilities have emitted over the years. Similar legislation , called the Responding to Emergency Needs From Extreme Weather (RENEW) Act, was introduced in this year's session, but never advanced out of House and Senate committees.

Vermont became the first state to enact this so-called climate Superfund bill into law this year, and a similar measure has passed in the New York legislature, though Gov. Kathy Hochul (D) has yet to sign it. A national bill has been introduced by U.S. Sen. Chris Van Hollen (D-Md.).