First Carbon Tariff Will Tax CO2 at the Border
The first carbon tax to reduce the greenhouse gases from imports comes not between two nations, but between two states. Minnesota has passed a measure to stop carbon at its border with North Dakota.
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To encourage the switch to clean renewable energy Minnesota plans to add a carbon fee of between $4 and $34 per ton of carbon dioxide emissions to the cost of coal-fired electricity, to begin in 2012, to discourage the use of coal power; the greatest source of greenhouse gas emissions.
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State officials in North Dakota are mounting a legal battle against Minnesota. State officials argue that this would unfairly discourage coal-powered electricity sales in favor of renewably powered electricity.
Coal has immediate health effects in addition to the well documented long term effects on climate. Coal has been implicated in asthma, diabetes, heart disease and even neurological damage, reducing intelligence levels. North Dakota ranks 8th in toxic metals contaminating its coal waste, with 3,419 tons of toxic metals.
Most of North Dakota’s electricity exports is generated by coal-fired power plants. North Dakota officials argue that the move would place an unfair tax on electricity exports from the state and discourage its use by Minnesota utilities.
The state had set aside $500,000 for legal fees to fight the law back in 2007, and having now exhausted their arguments with Minnesota are preparing to use the funds to take legal action.
Both states, ironically, have abundant wind power resources. North Dakota in particular has been called “the Saudi Arabia of Wind”. Yet, till now it has barely tapped into that clean energy resource, with the first few wind farms only just starting to come online. Basin Electric Coop just completed one project on New Years Eve and Spain’s Iberdrola just completed another a few days ago.
By contrast, North Dakota coal has low energy value.
Source: Bismark Tribune
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