Virginia Should Join The Transportation and Climate Initiative Program
The Transportation and Climate Initiative Program (“TCI-P”) requires transportation fuel suppliers to purchase allowances equivalent to the amount of carbon their product emits.
TCI-P brings in revenue for participating jurisdictions, 35% of which must be invested to improve transportation programs in marginalized communities.
Virginia should participate in the TCI-P to reduce carbon emissions from the state’s transportation sector and to continue being a national clean energy leader.
Virginia has been participating this year in the Regional Greenhouse Gas Initiative, a cap-and-trade program that puts a price on carbon emissions. Through RGGI, power generators are required to purchase carbon allowances equal to the amount of carbon they emit. A total of 11 states throughout the Northeast and Mid-Atlantic regions participate in the initiative. Via carbon auctions, Virginia has brought in an additional $142 million in revenue this year alone, with one more auction remaining. Beyond promoting a cleaner electric grid, the initiative benefits Virginians in that a percentage of RGGI funds go toward mitigating the effects of climate change and helping low-income individuals afford energy efficiency upgrades for their homes.
Similar to RGGI, another regional initiative is seeking to implement a cap-and-trade program for carbon emissions from the transportation sector. Since 2010, a group of jurisdictions participating in what’s known as the Transportation and Climate Initiative has been developing policies for the Northeast and Mid-Atlantic regions that will promote clean transportation systems and reduce carbon pollution. Virginia joined the TCI in 2018, just before the Transportation and Climate Initiative Program, or TCI-P, was announced.
A cap-and-trade program, TCI-P requires transportation fuel suppliers to purchase allowances at auctions for carbon emitted above a certain amount. Much like RGGI seeks to reduce carbon emissions from electric grids, TCI-P targets carbon emissions from the transportation sector, which account for nearly 40% of emissions in the Northeast and Mid-Atlantic regions, and roughly half of emissions in Virginia.
The program is still in its infancy. Only four jurisdictions — Connecticut, Washington D.C., Massachusetts, and Rhode Island — have committed to implementing policy that support the goals of the TCI-P, with the first allowance auctions slated to start in 2023. Once implemented, the TCI-P is expected to cut carbon emissions by 26% within ten years, and participating jurisdictions will likely be able to pull in an additional $3 billion in revenue over the same amount of time. And if all TCI jurisdictions implement TCI-P policy, revenue from the auctions are expected to exceed $2 billion each year.
Just as Virginia prioritizes equity in investing its RGGI funds, the agreement establishing the TCI-P also centers around equity. Communities that have been underserved by transportation systems or have been impacted by pollution to an exceptional degree will benefit from programs that promote clean transportation. The agreement guarantees that these programs receive at least 35% of funds from the carbon auctions. Participating jurisdictions will take funding recommendations from Equity Advisory Boards, which will consist mostly of members from marginalized communities.
The program will also have impressive benefits for human health. An analysis conducted last year by researchers from Harvard, Boston University, and the University of North Carolina found that the TCI-P will help avoid over 1,100 deaths and nearly 5,000 asthma cases that would have been the result of exposure to carbon emissions. Altogether, the program could save participating states over $11 billion in health costs.
The General Assembly should approve legislation during the next session to authorize Virginia’s participation in the TCI-P. Doing so would reduce carbon emissions from the transportation sector, all while bringing in revenue for jurisdictions to invest, help to uplift disadvantaged communities, and create better conditions for human health. The TCI-P enjoys support from the business community, and Virginia’s participation could serve as a catalyst for other jurisdictions to join. Virginia should take the opportunity to continue being a clean energy leader by joining and bolstering the TCI-P.