If New Jersey elects to join the TCI, a cap will be placed on the amount of carbon that will be permitted to be emitted from on-road gasoline and diesel fuels. Allowances to sell these fuels will be sold at auction with the proceeds intended to be used for initiatives that would reduce vehicle use or reduce carbon emissions.
Simply put, over the next decade the amount of gasoline and diesel that could be sold in New Jersey would be lowered by 20–25%. The revenues from the allowances, estimated to increase fuel prices by 5 to 17 cents would be used for projects as determined by each state. While no revenue projections were given, this “tax” could raise several hundred million dollars annually. The cost at the pump may prove to be higher if the demand is not lessened to meet the reduced supply.
While New Jersey has been a participant in the process, Gov. Phil Murphy has not indicated he will sign on to the TCI, which he would be required to do by this spring. Enabling legislation would also be needed.
With the announcement of the release of the draft MOU , there is now a major push by environmentalists and some transportation planners, to have all the states in the TCI region join. Massachusetts has been leading this effort with its business associations actively supporting TCI. New Hampshire has already indicated that it will not join.
Given the high cost of doing business in New Jersey, the fact that we just recently passed a gasoline tax increase to fund our road system, and NJBIA’s longstanding opposition to RGGI, the electric generation cap-and-trade sister to TCI, we are very skeptical on the need or efficacy of another tax and spend program.
NJBIA wants to know your thoughts. We are hosting a business community meeting on TCI on January 8, 2020 at 1:00 at NJBIA Headquarters. This meeting is essential to get your input and to plan our advocacy before New Jersey policymakers need to make decisions. If you have comments or would like to participate in that meeting, please contact Ray Cantor at email@example.com.