By Monica Samayoa (OPB)
June 28, 2024

In a letter to state environmental regulators, nine Senate Republicans sought to tie rising electricity rates to a program that is not yet in effect

Oregon Senate Republicans are questioning whether the state’s environmental agency has authority to re-create and implement a program that would drastically reduce greenhouse gas emissions from fossil fuel companies, a task those lawmakers said should be taken up by the Legislature instead.

In a letter addressed to the Oregon Department of Environmental Quality on June 19, nine Senate Republicans outlined their concerns about rising electricity rates and a potential connection to the state’s Climate Protection Program. They also questioned whether DEQ has the authority to create and implement the program — after the Oregon Court of Appeals ruled the agency’s first attempt invalid.

FILE: Republican state Sen. Lynn P. Findley, left, talks with Republican Sen. Bill Hansell on inauguration day at the Capitol in Salem, Ore., Jan. 9, 2023. Findley is one of nine Republican state senators who criticized Oregon's flagship climate program in a recent letter.

Kristyna Wentz-Graff / OPB

“We believe it’s an error for DEQ to fire up this program,” state Sen. Lynn Findley, R-Vale, said. “I would hope that they would want to sit down, have some conversation between the legislative branch and the administrative branch, and talk about paths forward.”

In their letter, the Senate Republicans shared “deep concern” about the program and claimed that its previous implementation has contributed to Oregonians’ rising electricity costs. Six of those lawmakers are in their final terms, barred from seeking reelection after they walked out during last year’s legislative session.

Related: Oregon Supreme Court rules that Republican senators who walked out last year can’t seek reelection

“Anyone that thinks that all these increased costs and programmed operations will be borne by the utility or borne by the industry is living in an alternative world, because they will pass all of those costs on to consumers,” said Findley, who is among the Republicans not allowed to run for reelection. “Any increased cost [to] utilities, or any company that has to comply with the Climate Protection Program, will be passed on 100% to the consumers.”

Findley said the program is partially to blame for the current surge in electricity rates — a claim that environmental regulators dispute.

Related: Utility watchdog calls to cap Oregon rate hikes as energy bills continue to rise

“So far this program hasn’t cost the utilities anything,” said Lauren Wirtis, DEQ’s communications and outreach manager.

Energy and gas rates have steadily increased over the past five years, mostly due to the increase in the price of natural gas, the cost of the transition to renewable energy and companies’ demand for profits.

If the Climate Protection Program had been implemented as intended earlier, fossil fuel companies would have been allowed to purchase carbon credits, each worth one ton of emissions. The funds collected would have gone toward programs benefiting communities most impacted by climate change.

“We didn’t get a chance to implement that program before, so nobody paid into that either,” Wirtis said.

In his criticism of the Climate Protection Program, Findley also said DEQ created the program “in a vacuum” and did not have adequate public participation, and he argued that it should have been drafted by lawmakers, not bureaucrats

The program was created under an executive order by former Gov. Kate Brown. Brown directed state agencies to develop rules that would limit and reduce fossil fuel emissions. The executive order came after state legislators failed to pass a cap-and-trade program that would reduce the state’s overall greenhouse gas emissions, which contribute to human-caused climate change.

“The correct solution would be to have the Legislature do it and, and DEQ to write rules on how to implement it,” Findley said.

Senate Republicans walked out two years in a row to prevent a quorum that would have allowed majority Democrats from voting on several bills, including a cap-and-trade bill.

“Senate Democrats are confident that the Department of Environmental Quality is responsibly putting programs in place to limit toxic pollution and modernize Oregon’s energy production,” Senate Majority Leader Kate Lieber, D-Beaverton & Southwest Portland, said in an email to OPB.

“The clean energy transition is happening because it is a safer, more sustainable investment for our economy and our communities,” she said. “We can either lead the way or get left behind.”
Rebooting Oregon’s flagship climate response

Currently, the Climate Protection Program is undergoing a second rule-making process. The program aimed to reduce fossil fuel emissions from oil and gas companies by 90% by 2050.

It was first implemented in 2022, and at the time was one of the strongest climate protection programs in the nation. But fossil fuel companies sued in March 2022, arguing DEQ exceeded its authority when it created the program’s rules. A court ruled late last year that the state’s first attempt was invalid, saying DEQ failed to comply with disclosure of the federal Clean Air Act.

DEQ’s Wirtis said the agency is confident that it has the full authority to re-create and implement the program and appreciates the feedback it continues to receive.

“The Legislature gave authority and direction to the agency to reduce air contaminants, which includes greenhouse gas emissions,” she said.

During the first rulemaking process, Wirtis said, the public process lasted over 18 months and DEQ received more than 7,000 comments.

In the second round, Wirtis said, DEQ is committed to learning what worked and what didn’t work.

The previous implementation of the program also accrued no costs from regulated fossil fuel companies, she said.

Wirtis said the agency is preparing to release a draft of the new Climate Protection Program rules soon, which will be open for public comment.

DEQ’s Environmental Quality Commission will vote on the new rules by the end of the year.

If passed, the new program’s implementation would begin in 2025.