CEO Climate Dialogue Carbon Price Letter to Leadership
May 11, 2021
Dear Speaker Pelosi, Majority Leader Schumer, Minority Leader McCarthy, and Minority Leader McConnell,
As a broad-based coalition of 26 leading businesses and institutions representing sectors across the U.S. economy — oil and gas, utilities, agriculture and food, automotive, chemicals, manufacturing, financial services, and environmental advocacy — we are united in recognizing the economic, health, and environmental risks posed by climate change. Accordingly, we urge members of both parties to work together and include an economy-wide price on carbon in any package of infrastructure investment and economic growth measures to be considered by Congress.
There is a clear economic imperative to act on climate. An economy-wide price on carbon can simultaneously help to avoid the trillions of dollars of lost economic growth, productivity declines, job losses, and higher costs that will result from unchecked climate change while harnessing market forces to create clean energy jobs, bolstering U.S. competitiveness, and ushering in a new era of prosperity.
Carbon pricing is a crucial complement to needed investments in grid infrastructure, decarbonized transportation infrastructure, and research, development & demonstration projects for clean energy technologies – all critical to meeting U.S. climate goals and building the low-carbon economy of tomorrow.
- Significantly reduce U.S. greenhouse gas emissions so that the U.S. is demonstrably a leader on global efforts to effectively limit climate change. Specifically, U.S. policy should ensure the country is on a path to achieve net-zero emissions across the economy by 2050 with aggressive near and mid-term emission reductions commensurate with this goal.
- Effective: A key test of any climate policy is whether it will deliver timely emissions reductions across the economy and includes mechanisms that provide certainty that emission goals are met. The timeline for reductions must allow capital intensive industries to adjust in an economically rational manner. Policies must encourage investment and planning decisions consistent with the timeframes needed. Policies must focus on emissions reductions outcomes, not specific resources or technologies.
- Market-based: An economy-wide price on carbon is the best way to use the power of the market to achieve carbon reduction goals, in a simple, coherent and efficient manner. We desire to do this at the least cost to the economy and households. Markets will also spur innovation, and create and preserve quality jobs in a growing low-carbon economy.
- Durable and responsive: Well-designed and stable policies will deliver predictable results and increase public support over time, providing durability across time and political cycles. Policies should be adaptive over time in terms of pace and scope of reductions as our understanding of climate change, policy impact, and technological changes evolves.
- Do no harm: Policies must support the competitiveness of the U.S. economy. Policies must address emissions leakage that can undermine climate objectives. Policies must also safeguard against negative impacts on biodiversity, land and water.
- Promote equity: Unabated climate change is a major threat to the U.S. economy. Therefore, policies to address climate change, which may also entail some cost, must provide transparency and promote affordability while distributing costs and benefits in such a way that promotes equity. Policies must include mechanisms to invest in American workers, and in disadvantaged communities that have the least resources to manage the costs of climate change.
The CEO Climate Dialogue looks forward to working with you to achieve infrastructure and climate goals.