ST3 Spends $100 For 11 Cents of Carbon Reduction (at best)

Oct 11, 2016

Imagine a climate policy where a paltry one-tenth of one percent of the spending actually reduced carbon emissions. What would left-wing environmental groups like Climate Solutions say about it? They would call it the “most important” climate vote you can take.

Next month, voters in the Puget Sound region will consider an expansion of Sound Transit’s light rail system. The program will cost an estimated $54 billion, more than the state budget. Supporters claim it will help reduce carbon emissions by moving people out of their cars and onto light rail and buses.

Last week, the campaign for the Sound Transit 3 (ST3) campaign, sent an e-mail touting the support of environmental activists at Climate Solutions. In their endorsement, Climate Solutions calls ST3, “the single most important vote we can cast to fight climate change.” They claim, “Proposition 1 will curtail over 793,000 metric tons of greenhouse gas each year when the mass transit system is built out across the Puget Sound region,” concluding that, “In other words, Proposition 1 is a big deal for addressing climate change.”

Actually, for every $100 dollars we spend on ST3, we will receive 12 cents worth of carbon reduction.

More will be spent on public art than carbon reduction with ST3. Obviously, people would laugh if ST3 was sold as an effort to expand public art. Yet, the percentage of the budget that will reduce carbon emissions is actually far smaller.

First, claiming Proposition 1, the vote to support ST3, will reduced “793,000 metric tons of greenhouse gas each year,” is simply false. According to Sound Transit, the real number for ST3 is 130,000 metric tons annually, or 16 percent of what ST3 and Climate Solutions claim.

In their analysis of “Social, Economic and Environmental Impacts,” Sound Transit notes, “Sound Transit 3 projects alone are projected to annual reduce…transportation-related greenhouse gas emissions by more than 130,000 metric tons annually.” The larger number comes only if you combine ST3 with the previous two expansions, double counting by claiming benefits taxpayers have already paid for.

Second, that amount of carbon reduction is extremely small. In California, where they have a carbon price set by a cap-and-trade system, it costs $12.95 to reduce one metric ton of carbon. Although ST3 only counts expenditures through 2041, the capital investment will last beyond the first 25 years. Of course, ST will have to pay for operations beyond 2041, so those costs have not been included. As a result, using their own numbers, this estimate is low.

Despite that, over 40 years, the value of the carbon emissions reduced is $1.68 million per year, or $67.34 million over 40 years. This amounts to 0.12 percent of the $54 billion ST3 says it will cost.

Sound Transit provides a slightly larger estimate, using the “social cost of carbon” of $38 per metric ton. This would increase the value over 40 years to $197.6 million or 0.37 percent of the Sound Transit budget. Even their own numbers indicate the carbon benefit for the environment will be extremely small.

I will note that using the social cost of carbon is not a useful test of the effectiveness of the policy. The key question is how we can maximize the carbon reduction for every dollar we spend. The California price measures the point at which companies will invest in carbon reduction projects. The $12.95 represents the real-world price of reducing carbon.

Finally, none of this takes into account the carbon emissions Sound Transit will release into the atmosphere during construction over two decades. Counting these emissions would reduce the environmental benefit even further.

Sound Transit’s estimate for carbon emissions for construction of the 8.5 miles in the Northgate to Lynwood extension is 64,000 metric tons. This is about one-seventh the length of the total ST3 construction. Assuming this is a reasonable estimate, ST3 would emit 448,000 metric tons. Subtracting this amount from the total savings removes about $5.8 million worth of carbon reduction benefit. This moves the benefit even lower, yielding only 11 cents of carbon reduction for every $100 spent on Sound Transit 3.

So, how can Climate Solutions call this the “single most important” vote on climate change this year compared to, say, I-732? Estimates show that I-732, the carbon tax swap ballot initiative that is estimated to reduce state taxes by $200 million a year, will reduce carbon emissions by more than 1.5 million metric tons annually – more than ten times the amount from ST3.

Once again, it is clear that the benefit for the environmental community is not helping the environment but is increasing taxes on working people. Environmental activists say they will not support a policy that cuts taxes and emissions, but they call for a policy that imposes a massive tax increase does little for climate, “the most important” policy on the ballot.

Slowly, the public is beginning to realize that so-called environmental groups care less about the environment than expanding government. For those of us who believe in the free-market and oftentimes live outside the cities, in places where we are surrounded by nature, there is a real opportunity to offer policies that express our environmental values in a way that is effective and is respectful of individual freedoms.

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