BILL REQ. #:  S-4419.2 

Read first time 01/21/08.   Referred to Committee on Natural Resources, Ocean & Recreation.

     AN ACT Relating to reducing greenhouse gases emissions; and adding a new chapter to Title 43 RCW.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:

NEW SECTION.  Sec. 1   The legislature finds that reducing greenhouse gases is critical to mitigating the effects of climate change. There is currently much scientific dialogue about the impacts of human-caused carbon dioxide emissions and other greenhouse gases to the atmosphere. It is important to take prudent steps now to reduce the effects of human activities on the climate. One step is to influence the amount of human-caused carbon dioxide that is added to or sequestered from the atmosphere through conserving and managing forests and producing long-lived forest products.
     The legislature finds that managed forests have the potential to provide a reduction in the emissions of carbon dioxide. Forests provide long-term storage pools and active carbon sinks. Additionally, they provide durable wood-based materials that can substitute for higher energy consuming products such as steel and concrete.
     For many, investments in more efficient ways to derive energy-powered services and forestry-based carbon offsets are proving to be a cost-effective part of an overall emissions reduction and offset program. Providing carbon credits to the forest industry could be an economic incentive that would maintain Washington's forest land base.

NEW SECTION.  Sec. 2   (1) The director of the department of ecology shall design a market-based cap and trade system consistent with the goals established by the legislature in RCW 80.80.020. In designing the market-based system to achieve the emissions goals established in RCW 80.80.020, the director shall:
     (a) Attempt, to the extent possible, to coordinate the development of a cap and trade system with other entities, such as the western climate initiative;
     (b) Seek to ensure that the system is equitable, administratively simple for government and private participants, and minimizes administrative costs; and
     (c) In conjunction with the department of community, trade, and economic development and section 3 of this act, establish voluntary allowances and accounting systems for carbon storage within the forest industry.
     (2) The director of the department of ecology, in conjunction with the department of transportation, and the department of licensing, shall establish a method to require every vehicle registered in the state to annually purchase carbon credits based on a greenhouse gas index or rating system for motor vehicle emissions when renewing their vehicle licenses according to chapter 46.16 RCW from the forestry carbon offset program established in section 3 of this act.
     (3) The director of the department of ecology must not require emissions reporting for forestry activities regulated under chapter 76.09 RCW and RCW 70.94.660.
     (4) The director of the department of ecology, in conjunction with the department of revenue, shall develop options for a method to require manufacturers, wholesalers, and retailers who sell products in Washington that are produced with a carbon intensive process, including foreign manufactured products, to purchase carbon credits from the forestry carbon offset program established in section 3 of this act.
     (5) The director of the department of ecology shall report to the legislature by December 1, 2008, on the following:
     (a) The progress to date in achieving the requirements of this section;
     (b) Recommendations on future directions; and
     (c) Any additional resources and statutory authority needed to implement the voluntary forestry carbon offset program.

NEW SECTION.  Sec. 3   (1) The director of the department of community, trade, and economic development shall design and implement a forestry carbon offset program. For purposes of this section, "forestry carbon offset" means a transferable unit based on a measured amount of carbon storage expressed as a carbon dioxide equivalent and accruing on forest land as live or dead matter in trees, shrubs, forest litter, and soil, and in forest products.
     (2) The director of the department of community, trade, and economic development shall establish a forestry carbon offset program advisory group. The advisory group consists of at least nine persons and must contain:
     (a) A representative from the department of natural resources;
     (b) A representative from the department of fish and wildlife;
     (c) A representative from the department of ecology;
     (d) Representatives from private forest landowners and the forest products industry;
     (e) A representative from a nongovernmental forestry conservation organization; and
     (f) Representatives from businesses, governmental agencies, and nongovernmental organizations with knowledge and experience in the accounting of carbon sequestration and storage.
     (3) The director of the department of community, trade, and economic development, in conjunction with the forestry carbon offset program advisory group, shall develop administrative rules that define principles and standards relating to the creation, measurement, accounting, marketing, verifying, registering, transferring, and selling of forestry carbon offsets from forest lands subject to the forest practices act, chapter 76.09 RCW.
     (4) Rules adopted under this section must set standards to ensure that in order to be marketed, registered, transferred, or sold, a forestry carbon offset must be created as a result of forest management activities that:
     (a) Have the effect of increasing carbon storage on forest lands and products as measured by a forestry carbon offset accounting system; and
     (b) Provide environmental, social, and economic benefits for Washington and its citizens including, but not limited to, protection or enhancement of long-term timber supplies, native fish and wildlife habitat, and water quality.
     (5) The director of the department of community, trade, and economic development shall contract with the college of forest resources at the University of Washington who shall work in conjunction with a nonprofit consortium involved in research on renewable industrial materials, to establish a formula to ensure that the forestry carbon offset accounting system:
     (a) Accounts for relevant sources of carbon credits for carbon storage or sequestration;
     (b) Accounts for duration and permanence of the carbon storage or emission reductions;
     (c) Includes provisions for establishing the appropriate baseline for forestry and forest product manufacturing practices from which carbon credits for carbon storage or sequestration may be measured. The baseline must be based on minimum compliance with the forest practices rules adopted under chapter 76.09 RCW as of January 1, 1990;
     (d) Accounts for site-class specific forest management practices, including provisions for establishing carbon credits for carbon storage or sequestration, from the implementation of practices contributing to increased carbon for a given rotation or independent of rotation, if necessary, to meet regulatory requirements;
     (e) Accounts for carbon credits for carbon storage resulting from harvesting for wood products and the collection of biomass for biofuel or other products;
     (f) Accounts for environmental, social, and economic benefits of forestry carbon offsets by ensuring that forest landowners that participate in the system are actively managing their forests; and
     (g) Encourages third-party verification (certification) of forestry carbon offsets.
     (6) Rules adopted under this section may address qualifications for persons and agencies that provide third-party verification and registration of forestry carbon offsets.
     (7) The director of the department of community, trade, and economic development shall report to the legislature by December 1, 2008, on the following:
     (a) The progress to date in achieving the requirements of this section;
     (b) Recommendations on future directions; and
     (c) Any additional resources and statutory authority needed to implement the voluntary forestry carbon offset program.

NEW SECTION.  Sec. 4   Sections 1 through 3 of this act constitute a new chapter in Title 43 RCW.