Feb 4, 2021 - Energy & Environment

Biden's Commerce pick keeps cards close on potential carbon tariffs

Picture of Gina Raimondo speaking behind a line of microphones
Photo: Barry Chin/The Boston Globe via Getty Images

The Biden administration's nominee to run the Commerce Department isn't ruling out the use of existing powers to impose climate-related trade restrictions.

Driving the news: GOP Sen. Ted Cruz asked Gina Raimondo about imposing "carbon tariffs" under existing law.

Raimondo responded to the written question — part of the Senate Commerce Committee's vetting — like this:

  • "I intend to work closely with Congress on the issue of climate change and can commit to use the tools available under the law and work with our interagency partners and other stakeholders to implement the Administration’s environmental policies, as appropriate."

Why it matters: One tricky thing in climate policy is how to ensure industries in countries that impose emissions-cutting rules — which Biden is planning — don't face a competitive disadvantage.

  • Biden's platform vowed "carbon adjustment fees or quotas on carbon-intensive goods from countries that are failing to meet their climate...obligations."
  • Such trade measures could also avoid simply moving emissions from place to place.

Yes, but: Biden's platform doesn't say whether he'd seek legislation for the policy.

  • Kevin Book, managing director of the research firm ClearView Energy Partners, said Biden may have an avenue to proceed using executive power.
  • “Biden made climate a national security issue on the second climate executive order and, although we don’t yet expect it, Section 232 [of the Trade Expansion Act] allows Presidential import tariffs for national security reasons," he said.

Where it stands: The Commerce Committee voted 12-3 yesterday to advance Raimondo's nomination to the full Senate.

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