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Ray Cantor – VP, Government Affairs

If you have not yet heard of the Transportation Climate Initiative (TCI), now is the time to become informed, and involved. The TCI is the product of the Georgetown Climate Initiative, and like the Regional Greenhouse Gas Initiative (RGGI) before it, TCI involves the efforts of many states (12 and the District of Columbia) in the Northeast and Mid-Atlantic region. Unlike RGGI, which focused on the production of electricity, TCI seeks to reduce carbon from the transportation sector.

TCI is billed as a “cap and invest” program but its elements are simple. A fee or tax is placed on the distribution of carbon-based transportation fuels (i.e. gasoline and diesel) for two purposes. One is to make it more expensive to use these fuels and hopefully lower demand as a result. The other purpose is to raise revenues for a variety of carbon-reduction measures related to the transportation sector. These measures would be left to the states to determine, but would likely include incentives for electric vehicles, including cars, trucks and buses, enhancements to mass transit, and other strategies to get people to drive less, such as carpooling, work-from-home programs, and the enhanced use of bicycles.

The other key component of TCI is the cap. A cap on the amount of carbon that the transportation sector can emit would be set and reduced over time. This would essentially reduce the actual amount of fossil fuels available, and necessitate that the public use alternatives. The cap would continually be reduced until, presumably, there would be no transportation fossil fuel left.

Under the proposed timeframe, states would commit to participation in TCI by signing a MOU in the spring of 2020. Any necessary legislative or administrative action would be undertaken by the fall. Given Gov. Phil Murphy’s strong stance on climate change, it is likely he will sign the MOU. What the Legislature does, or needs to do, after that is an open question at this point. While the Department of Environmental Protection, the Department of Transportation, and the Board of Public Utilities have been part of the TCI discussions since 2010, the Legislature has been largely left out of the process.

There are several facts that need to be considered when debating if New Jersey should participate in TCI. First, if we are going to meet the ambitious carbon reduction goals of the Global Warming Response Act (80% reduction of carbon over 2006 levels by 2050), transportation will have to be addressed because it accounts for 42% of New Jersey’s carbon emissions. The question becomes how do we do it and when do we begin?

We first need to understand the costs, impacts, technologies, and options. We need to consider if TCI would be effective and how the money would be spent. As vehicles begin to be fueled by non-carbon sources we will need to address how to replace the gas tax revenues currently used to support our roads and bridges. At this point there are more questions than answers, but the decision-making process will fast be upon us.

NJBIA will be actively engaged in this process. We will be providing you more information as the weeks and months go on and will be seeking to engage our members, and policymakers, in this discussion. Your feedback is essential. If you have any questions or comments, or want to be more actively involved, please contact Ray Cantor at rcantor@njbia.org.

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