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1 New Chapter; Carbon Pricing. Amend RSA by inserting after chapter 339-G the following new chapter:
CHAPTER 339-H
CARBON PRICING
339-H:1 Definitions. In this chapter:
I. "Applicable entity" means the vendor of a carbon-based fuel, at the first point of sale within the state.
II. "Carbon-based fuel" means coal, a petroleum product, natural gas, or electricity produced from such fuels.
III. "Carbon dioxide equivalent" and "C02e" mean the amount of carbon dioxide by mass that would produce the same global warming impact as a given mass of another greenhouse gas over an integrated 20-year time frame after emission, based on the best available science.
IV. "Commission" means the New Hampshire public utilities commission.
V. "Department" means the department of revenue administration.
VI. "Electricity suppliers" means electric utilities providing default energy service and competitive electricity retailers.
VII. "Greenhouse gas" or "greenhouse gas emission" means carbon dioxide, methane, nitrous oxide, hydrofluorocarbons, perfluorocarbons, sulfur hexafluoride, and any other substance emitted into the air that may be reasonably anticipated to cause or contribute to anthropogenic climate change.
VIII. "Petroleum product" means all petroleum derivatives, whether in bond or not, which are commonly burned to produce heat, electricity, or motion, or which are commonly processed to produce synthetic gas for burning, including without limitation, propane, gasoline, unleaded gasoline, kerosene, heating oil, diesel fuel, kerosene based jet fuel, and number 4, number 5 and residual oil for utility and non-utility uses, but not including, petroleum feedstocks to plastics production or other manufacturing.
339-H:2 Carbon Pricing; Fee.
I. Every applicable entity shall pay, in a manner determined in rules adopted pursuant to RSA 541-A by the commissioner of revenue administration, a fee to the department on any carbon-based fuel sold, used, or entered into the state by such applicable entity for purposes of distribution or use within the state.
II. The amount of the fee imposed by paragraph I on any carbon-based fuel shall be equal to the applicable amount per ton of carbon dioxide equivalent that would be emitted through the combustion of such product, as determined in rules adopted pursuant to RSA 541-A by the department of environmental services and pursuant to RSA 339-H:6.
III. For the purposes of paragraph II, the applicable amount shall be:
(a) For any carbon-based fuel sold, used, or imported into the state during calendar year 2020, $20;
(b) For any carbon-based fuel sold, used, or entered into the state during any calendar year after 2020 and before 2030, an amount equal to the sum of:
(1) The sum of the amount in effect under this paragraph for the preceding calendar year plus $10; and
(2) The product of the amount determined under subparagraph (1) for such year and an inflation adjustment using the United States Bureau of Labor Statistics Consumer Price Index or, if that index is not available, another index adopted by the department.
(c) For any carbon-based fuel sold, used, or entered into the state during any calendar year after 2030, an amount equal to the sum of:
(1) The amount in effect under this paragraph for the preceding calendar year; and
(2) The product of the amount determined under subparagraph (1) for such year and an inflation adjustment using the United States Bureau of Labor Statistics Consumer Price Index or, if that index is not available, another index adopted by the department.
IV. The department shall calculate and publish the amount of the fee established under this section in current dollars for each year by October 1 of the previous year.
V. The department shall require all applicable entities to pay the fees required pursuant to this section by the end of each calendar quarter.
VI. The department shall deposit all moneys collected by applicable entities paying the fee established in this section in the carbon pricing fund. The carbon pricing fund is hereby established in the treasury and shall be nonlapsing and continually appropriated to the department. Amounts in the fund shall be expended as provided in RSA 339-H:5.
VII. Each applicable entity paying the fee established in this section shall submit an annual compliance report to the department, by a date and in a form prescribed in rules of the department. Each report shall include clear and concise information that demonstrates that the applicable entity made calculations and collected moneys fully in accordance with this section. The department shall determine if each applicable entity complied with the requirements of this chapter, or if additional actions must be taken by the applicable entity to come into compliance. Failure to pay the fees due under this chapter shall be subject to enforcement and penalties provided in RSA 21-J:33.
339-H:3 Calculation of Emissions Factors.
I. Not later than one year after enactment of this chapter, the department of environmental services shall, for each carbon-based fuel identified in this chapter, including various sources of electricity consumed in the state, calculate greenhouse gas emissions factors, in units of carbon dioxide equivalent.
II. Emissions factors calculated under this section shall take into account life-cycle greenhouse gas emissions.
III. At least once a year, the department of environmental services shall calculate, for each electricity supplier, greenhouse gas emissions factors, in carbon dioxide equivalent per megawatt-hour, associated with the combustion of each carbon-based fuel identified in this chapter for the purposes of generating electricity.
339-H:4 Reduction in Fees Due. Any fees due under RSA 339-H:2 shall be reduced by the amount of any fee or payment due under any federal law or regional carbon pricing system that establishes a direct greenhouse gas price on the same carbon-based fuels for the same year as the fee required in this chapter, provided however that such reduction shall not be to an amount less than zero.
339-H:5 Use of Funds. The moneys in the carbon pricing fund shall be used for the following:
I. Up to 5 percent of funds collected annually may be used to pay for administrative costs associated with collecting the fees established in RSA 339-H:2 and in administering the carbon pricing fund.
II.(a) Twenty percent shall be distributed to greenhouse gas reduction programs that primarily benefit low-income residents and families, small-business properties, or non-profit organizations, based on recommendations of the commission and the department of environmental services;
(b) Seventy percent shall be used to provide rebates to state residents; and
(c) Five percent shall be used to provide rebates to disproportionately impacted large commercial and industrial energy users in the state.
III. Fees collected under this chapter shall only be used for the purposes described in this section.
IV. No later than 6 months after the effective date of this chapter, the department shall adopt a schedule of fees to be levied on the sources of greenhouse gas emissions identified in this chapter. No later than 9 months after enactment, department shall adopt rules and publish the mechanism by which 70 percent of the fees collected under this program shall be rebated to the residents of the state of New Hampshire. For such rebates, every adult shall receive one full share, while every child under the age of 18 shall receive one-half share, with no single family unit to receive more than the equivalent of 3 full shares. In determining the most efficacious mechanism for providing rebates to New Hampshire residents, the department shall prioritize direct property tax relief and the provision of funding to individuals receiving Section 8 housing assistance under the federal Department of Housing and Urban Development.
339-H:6 Rulemaking.
I. The commissioner of the department of environmental services shall adopt rules under RSA 541-A for the calculation of emissions factors in RSA 339-H:3.
II. The commissioner of the department of revenue administration shall adopt rules under RSA 541-A required for the implementation of this chapter.
2 New Subparagraph; Application of Receipts. Amend RSA 6:12, I(b) by inserting after subparagraph (343) the following new subparagraph:
(344) Moneys deposited in the carbon pricing fund established in RSA 339-H:2.
3 Effective Date. This act shall take effect July 1, 2019.
Text to be added highlighted in green.
1 New Chapter; Carbon Pricing. Amend RSA by inserting after chapter 339-G the following new chapter:
CHAPTER 339-H
CARBON PRICING
339-H:1 Definitions. In this chapter:
I. "Applicable entity" means the vendor of a carbon-based fuel, at the first point of sale within the state.
II. "Carbon-based fuel" means coal, a petroleum product, natural gas, or electricity produced from such fuels.
III. "Carbon dioxide equivalent" and "C02e" mean the amount of carbon dioxide by mass that would produce the same global warming impact as a given mass of another greenhouse gas over an integrated 20-year time frame after emission, based on the best available science.
IV. "Commission" means the New Hampshire public utilities commission.
V. "Department" means the department of revenue administration.
VI. "Electricity suppliers" means electric utilities providing default energy service and competitive electricity retailers.
VII. "Greenhouse gas" or "greenhouse gas emission" means carbon dioxide, methane, nitrous oxide, hydrofluorocarbons, perfluorocarbons, sulfur hexafluoride, and any other substance emitted into the air that may be reasonably anticipated to cause or contribute to anthropogenic climate change.
VIII. "Petroleum product" means all petroleum derivatives, whether in bond or not, which are commonly burned to produce heat, electricity, or motion, or which are commonly processed to produce synthetic gas for burning, including without limitation, propane, gasoline, unleaded gasoline, kerosene, heating oil, diesel fuel, kerosene based jet fuel, and number 4, number 5 and residual oil for utility and non-utility uses, but not including, petroleum feedstocks to plastics production or other manufacturing.
339-H:2 Carbon Pricing; Fee.
I. Every applicable entity shall pay, in a manner determined in rules adopted pursuant to RSA 541-A by the commissioner of revenue administration, a fee to the department on any carbon-based fuel sold, used, or entered into the state by such applicable entity for purposes of distribution or use within the state.
II. The amount of the fee imposed by paragraph I on any carbon-based fuel shall be equal to the applicable amount per ton of carbon dioxide equivalent that would be emitted through the combustion of such product, as determined in rules adopted pursuant to RSA 541-A by the department of environmental services and pursuant to RSA 339-H:6.
III. For the purposes of paragraph II, the applicable amount shall be:
(a) For any carbon-based fuel sold, used, or imported into the state during calendar year 2020, $20;
(b) For any carbon-based fuel sold, used, or entered into the state during any calendar year after 2020 and before 2030, an amount equal to the sum of:
(1) The sum of the amount in effect under this paragraph for the preceding calendar year plus $10; and
(2) The product of the amount determined under subparagraph (1) for such year and an inflation adjustment using the United States Bureau of Labor Statistics Consumer Price Index or, if that index is not available, another index adopted by the department.
(c) For any carbon-based fuel sold, used, or entered into the state during any calendar year after 2030, an amount equal to the sum of:
(1) The amount in effect under this paragraph for the preceding calendar year; and
(2) The product of the amount determined under subparagraph (1) for such year and an inflation adjustment using the United States Bureau of Labor Statistics Consumer Price Index or, if that index is not available, another index adopted by the department.
IV. The department shall calculate and publish the amount of the fee established under this section in current dollars for each year by October 1 of the previous year.
V. The department shall require all applicable entities to pay the fees required pursuant to this section by the end of each calendar quarter.
VI. The department shall deposit all moneys collected by applicable entities paying the fee established in this section in the carbon pricing fund. The carbon pricing fund is hereby established in the treasury and shall be nonlapsing and continually appropriated to the department. Amounts in the fund shall be expended as provided in RSA 339-H:5.
VII. Each applicable entity paying the fee established in this section shall submit an annual compliance report to the department, by a date and in a form prescribed in rules of the department. Each report shall include clear and concise information that demonstrates that the applicable entity made calculations and collected moneys fully in accordance with this section. The department shall determine if each applicable entity complied with the requirements of this chapter, or if additional actions must be taken by the applicable entity to come into compliance. Failure to pay the fees due under this chapter shall be subject to enforcement and penalties provided in RSA 21-J:33.
339-H:3 Calculation of Emissions Factors.
I. Not later than one year after enactment of this chapter, the department of environmental services shall, for each carbon-based fuel identified in this chapter, including various sources of electricity consumed in the state, calculate greenhouse gas emissions factors, in units of carbon dioxide equivalent.
II. Emissions factors calculated under this section shall take into account life-cycle greenhouse gas emissions.
III. At least once a year, the department of environmental services shall calculate, for each electricity supplier, greenhouse gas emissions factors, in carbon dioxide equivalent per megawatt-hour, associated with the combustion of each carbon-based fuel identified in this chapter for the purposes of generating electricity.
339-H:4 Reduction in Fees Due. Any fees due under RSA 339-H:2 shall be reduced by the amount of any fee or payment due under any federal law or regional carbon pricing system that establishes a direct greenhouse gas price on the same carbon-based fuels for the same year as the fee required in this chapter, provided however that such reduction shall not be to an amount less than zero.
339-H:5 Use of Funds. The moneys in the carbon pricing fund shall be used for the following:
I. Up to 5 percent of funds collected annually may be used to pay for administrative costs associated with collecting the fees established in RSA 339-H:2 and in administering the carbon pricing fund.
II.(a) Twenty percent shall be distributed to greenhouse gas reduction programs that primarily benefit low-income residents and families, small-business properties, or non-profit organizations, based on recommendations of the commission and the department of environmental services;
(b) Seventy percent shall be used to provide rebates to state residents; and
(c) Five percent shall be used to provide rebates to disproportionately impacted large commercial and industrial energy users in the state.
III. Fees collected under this chapter shall only be used for the purposes described in this section.
IV. No later than 6 months after the effective date of this chapter, the department shall adopt a schedule of fees to be levied on the sources of greenhouse gas emissions identified in this chapter. No later than 9 months after enactment, department shall adopt rules and publish the mechanism by which 70 percent of the fees collected under this program shall be rebated to the residents of the state of New Hampshire. For such rebates, every adult shall receive one full share, while every child under the age of 18 shall receive one-half share, with no single family unit to receive more than the equivalent of 3 full shares. In determining the most efficacious mechanism for providing rebates to New Hampshire residents, the department shall prioritize direct property tax relief and the provision of funding to individuals receiving Section 8 housing assistance under the federal Department of Housing and Urban Development.
339-H:6 Rulemaking.
I. The commissioner of the department of environmental services shall adopt rules under RSA 541-A for the calculation of emissions factors in RSA 339-H:3.
II. The commissioner of the department of revenue administration shall adopt rules under RSA 541-A required for the implementation of this chapter.
2 New Subparagraph; Application of Receipts. Amend RSA 6:12, I(b) by inserting after subparagraph (343) the following new subparagraph:
(344) Moneys deposited in the carbon pricing fund established in RSA 339-H:2.
3 Effective Date. This act shall take effect July 1, 2019.