Minnesota Introduces World's First Carbon Tariff

hollywoodb writes "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. 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 ... Minnesota has been generally pushing for cleaner power within its borders, but the utility companies that operate in MN have, over the past decades, sited a lot of coal power plants on the relatively cheap and open land of North Dakota, which is preparing a legal battle against Minnesota over the tariff."

Comments

culmination of quite a long attempt

[Trepidity]

Minnesota's attempt to do this dates back nearly 20 years, long before the current global-warming political debate, so interesting to see it finally passing. I believe the first bill was proposed in 1992, which would've imposed a $6 per ton tax; here's a 1994 report by a MN environmental group as well. Major attempts seemed to happen every 3-5 years.

Re:Minnesota Carbon Tariff is Illegal

[Trepidity]

It's not nearly that clear in this case. The tax is only applied to companies doing business in Minnesota, and is only assessed on the portion of their business considered to impact Minnesota (i.e. emissions actually generated in Minnesota, emissions imputed to electricity transmitted in Minnesota, etc.). It's at least arguable that that doesn't violate the dormant commerce clause: MN isn't specifically taxing only imports and exempting in-state MN electricity generators, which is the usual inter/intra-state disparity in treatment that caused constitutional problems; nor is the state attempting to tax companies that don't do business in MN.

Re:UNCONSTITUTIONAL

[wiggles]

Interstate trade is regulated by Congress, according to the constitution. Courts have held that all taxes on trade between states are an unconstitutional restraint on trade. The only exception is alcohol, which is granted an exception by the 21st amendment.

It's even worse

[jvonk]

Everything is defined as interstate commerce now, at least when the Feds want it to be. Allow me to cite two Supreme Court cases:

Gonzales v. Raich - A woman in California grew medical marijuana (legal in CA) and gave it away for free, solely within California. This was defined as interstate commerce in the decision.

US v. Stewart - Stewart personally designed and built his own homebrew machine guns, not for sale. After he was busted by the feds, he lost the case but won on appeal. The government appealed the case to the Supreme Court. It was remanded by the Supreme Court back to the appellate court for reconsideration "in light of" Raich. This means that the Supreme Court considers Stewart's actions to be interstate commerce too.

In conclusion, "interstate commerce" is now de facto defined as "anything the Federal government wants to regulate, even if there is no commercial or interstate aspect". Naturally, I imagine that this flexible definition is reserved for the Feds use only--no doubt states will have to continue to use the actual definition (ie. what the Constitution actually means).

Re:It's Even More Complicated Than that

[Red Flayer]

Now, this requires Minnesota to prove that the coal generated electricity is a threat to health and or safety of its citizens. That's going to be hard to do.

Au contraire, mon frere. This issue has been proved already in federal court, relating to federal lawsuits brought by NJ under the Clean Air Act to stop dirty coal-fired plants in upwind states (PA, OH, WV, maybe more).

Re:Different interpretations of the law

[Marxist Hacker 42]

Yes, but Article I Section 10 specifically forbids the States from using Tariffs to regulate commerce.