In a marathon late-night session, the Massachusetts State Senate passed legislation creating economy-wide carbon pricing, and requiring the state to reach net zero emissions by 2050. In doing so, the Senate doubled down on its commitment to the market-based policy to reduce emissions, which passed the chamber in 2018 but failed to make progress in the House.

The political landscape of climate policy has shifted rapidly in the two years since the Senate last voted for carbon pricing. Increased pressure for climate action, new emissions reduction commitments from policymakers, and growing grassroots support, have all increased the odds that the Senate’s bill, and carbon pricing, will become law.

The Senate’s Climate Package

Originally written by Senator Michael Barrett (D-Lexington) and Senate leadership (Senate President Karen Spilka and Ways & Means Committee Chair Michael Rodrigues), the climate package progressed rapidly through the Senate.

Last last year, President Spilka promised a vote of the full Senate on a comprehensive climate bill before January 31st, 2020. Her promise came after the Chair of the Senate Committee on Climate Change & Global Warming Marc Pacheco (D-Taunton) publicly admonished Senate leadership for lack of action on climate change and threatened a procedural measure to bring a climate bill to the floor.

On January 23rd, the Senate released the three bills, collectively called the ‘Senate Climate Package.’ The main bill, An Act setting next-generation climate policy (S.2477), included carbon pricing in addition to a number of other innovative and impactful climate policies. This includes a requirement to achieve net zero emissions statewide by 2050, the creation of an independent ‘watchdog’ commission to ensure climate policy is implemented effectively, and a program to allow local communities to enact rules requiring new construction to be net zero.

The cornerstone of the bill is its establishment of economy-wide carbon pricing. The legislation takes a page from a 2018 Senate omnibus bill by creating a carbon price that leaves program design to future gubernatorial administrations to decide. They would be free to choose among a variety of market-based carbon reduction mechanisms, including a revenue-neutral carbon fee or regional “cap and trade” (like TCI or RGGI). The new Senate bill does set a time limit for establishing the carbon price based on specific sectors. A carbon price on transportation would need to be set by January 1st, 2022; the requirement could be met through the Transportation & Climate Initiative (TCI). A carbon price applying to commercial, industrial, and institutional buildings would need to be in place by January 1st, 2025. Finally, a carbon price applying to residential buildings will be required by January 1st, 2030. The bill does not address how the revenue from these carbon prices would be used, but revenue use would be determined by the legislature in the future.

On Thursday (1/30), the Senate deliberated and voted on the entire climate plan. During the seven hour session, Senators passed a number of amendments pushed by the Massachusetts carbon pricing coalition. These included two from Senator Cindy Friedman that require reporting on benefits to low-income residents and language that strengthens low-income households. It also included one from Senator Jo Comerford creating rural equity, and another from Senator Paul Feeney focusing on creating a just transitions for workers [see a full list of amendments here].