SALEM — Less than a month before legislators convene again, a new proposal to cap Oregon’s greenhouse gas emissions is taking firmer shape.

The aim is to reduce the state’s overall emissions from electricity, fossil fuels like natural gas and diesel, and industrial processes like making cement, steel and semi-conductors.

Together, those three sectors account for about 80 percent of the state’s greenhouse gas emissions, according to a briefing provided Thursday by two Democratic state senators.

In a nod to industry, the new plan does not enact limits on natural gas emissions from high-emissions factories. Key industries would still remain subject to limits on other emissions from their production. And to cut the impact on rural Oregon, the new plan still limits emissions attributable to fuel suppliers, but first in Portland and then just in other populous areas.

The proposal hinges on a system of emission allowances — essentially permits to emit greenhouse gases — that can be bought and sold.

“In terms of those who are directly going into the market to purchase allowances, aside from the utilities, we're really just looking at about nine or so industrial customers at this point,” said state Sen. Michael Dembrow, D-Portland. “Everyone else, it will be done through their utilities. And the big fuel importers.”

The bill aims to reduce Oregon emissions 45 percent below 1990 levels in the next 15 years, and to 80 percent below 1990 emissions levels by 2050.

The legislative concept is expected to be posted on the Legislature’s website on Friday, Jan. 10. A legislative committee is expected to consider the legislation on Monday, Jan. 13.

Dembrow said in an interview that they are proposing four big changes from last year’s effort that derailed the Legislature.

The first change, Dembrow said, is that capping emissions from gasoline and diesel would be phased in over the next several years. Fuel importers would not have to get emissions allowances with respect to rural areas of the state, though those areas could opt in to the regulations if they want.

Starting in two years, fuel suppliers in the Portland metro area must obtain allowances. Three years later, in 2025, suppliers delivering to areas receiving more than 10 million gallons of fuel would be covered by the program and face new limits.

The second change corresponds to how industrial users of natural gas would be regulated. The utilities or marketers supplying the gas would deal with the corresponding allowances.

The new plan would also set aside money for environmental initiatives like wildfire prevention and forest health, and task the Department of Environmental Quality with regulating the system.

Lawmakers dropped the idea of setting up a new state agency to manage the program.

State Sen. Arnie Roblan, D-Coos Bay, said that change emerged out of conversations with legislators opposed to the program last year, many of whom were worried about creating a new state agency at a cost of millions.

“I really see this as one of the ways in which we have eliminated creating new bureaucracy in the state,” Roblan said.

Various iterations of the proposal have been passed around the Capitol in recent months. One version dated Dec. 23 spanned 100 pages of dense text.

But it’s not a sure bet that the latest proposal will float on Oregon’s choppy political seas.

Last year’s effort prompted Republicans to storm out of the building — and the state. The Republican senators returned only after they were assured that Democrats didn’t have enough votes to pass the policy.

The latest version of the plan began in the garage of the state Capitol.

That’s where Roblan and Sen. Fred Girod, R-Stayton, started talking about what could be done to address greenhouse gas emissions in Oregon, per Roblan’s account.

Their chat became the seed of a plan shared by Roblan and Dembrow, with reporters on Thursday, Jan. 9.

While the effort started out on informal and amicable terms, Girod is no longer involved in the crafting of the policy, telling The Oregonian that changes intended to accommodate rural Oregon in the bill were “fake” and disdaining the process.

Girod didn’t respond to phone and email messages from the Oregon Capital Bureau seeking comment on Thursday.

Dembrow said that while Girod may be stepping back, he and Roblan “continue to take his perspective into consideration.”

Down in the garage, Girod had mentioned to Roblan their work on Cleaner Air Oregon — a recent bipartisan effort to clean up air pollution — and asked Roblan if he wanted to “have a conversation” on greenhouse gas emissions, Roblan said.

“I said, ‘Sure, that'd be great,’” Roblan said. “So we started having some conversations. We brought in some different experts that could help us and eventually decided we really needed to make sure that Senator Dembrow was involved because this was really a Senate kind of thing. And so eventually it grew to a bigger group of people and . . . conversations kept going. We got a lot of help from experts from the governor's office.”

Roblan said the proposal is a work in progress.

“We have a lot of work, I think, left to do,” Roblan said.

The plan is a priority for Gov. Kate Brown in the 2020 session. After the policy hit a political brick wall last year, she threatened to use her executive powers to mandate the creation of an emissions policy. And pressure to develop a politically viable plan is also coming from environmental groups, which have been proposing ballot measures that would ask the voters to impose changes instead of the Legislature.

In December, Brown appeared to suggest that Republicans would want to stay in the Capitol if they could get legislative relief from ever-intensifying wildfires while the greenhouse gas initiative moved ahead.

“I would hate for the Legislature as a whole not to take up forest health and wildfire resilience when we have this opportunity, and frankly, a road map,” Brown said at the time.

“We’re continuing to hear from people concerned about climate change and a need to move forward, have Oregon step up and be a leader and deal with what we're really experiencing as a state in terms of fires and water problems and other issues, snowpack, obviously,” Dembrow said. “But, at the same time, recognizing the concerns that especially rural Oregonians feel about their livelihoods, their jobs, and their ability to make ends meet. And so, you know, I think we have committed to coming up with a program recognizing both of those needs.”

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