INTERNAL COST OF CARBON
Binding City Policy
BCP-ENN-5.11
PURPOSE
WHEREAS, the climate emergency is an existential threat to our community and economy, and combatting it will require government agencies to treat this as the crisis it is by taking bold steps to meet Portland’s carbon reduction goals and building a healthy, resilient city in which everyone can thrive; and
WHEREAS, the City of Portland government has both an opportunity and obligation to model innovative implementation approaches to reducing carbon emissions in its operations for other organizations and industries to follow in order to help meet the City’s community-wide decarbonization goals; and
WHEREAS, the City of Portland’s Climate Emergency Declaration, Resolution No. 37494, adopted in June 2020, directed the Bureau of Planning and Sustainability to involve youth and other stakeholders in the development of a proposed climate test, such as an internal carbon fee or shadow price on carbon; and
WHEREAS, the purpose of a climate test is to ensure that City bureaus are making informed decisions based on the best available climate science, particularly for major capital investments and high-carbon impact decisions, such as fuel and vehicle purchases; and
WHEREAS, Resolution No. 37483, adopted March 2020, identifies the development and application of a shadow price of carbon as an emerging best practice for reducing greenhouse gas emissions in City operations; and
WHEREAS, the Sustainable City Principles, adopted in 2015, commit Portland elected officials and staff to think beyond first costs and consider long-term, cumulative impacts when making policy and financial decisions; and
WHEREAS, Resolution No. 37419 amended the Financial Planning Policy FIN 2.03 requiring City bureaus to minimize environmental, social, and economic risks; and to maintain infrastructure at the lowest life cycle 37526 cost which meets service objectives; and
WHEREAS, Portland is a signatory to the C40 Net Zero Carbon Buildings Declaration, which commits City assets and infrastructure to becoming net zero carbon by 2030; and
WHEREAS, Bureau of Planning and Sustainability staff have conducted a thorough review of climate test applications that have been adopted by other municipal and federal governments, universities, and private industries to inform the City’s climate test policy; and
WHEREAS, the City of Portland received valuable input from youth and other stakeholders in the development of a proposed climate test, and continued collaboration will lead to stronger outcomes;
POLICY
NOW, THEREFORE, BE IT RESOLVED, that the City of Portland internal cost of carbon policy, attached hereto as Exhibit A, is adopted.
BE IT FURTHER RESOLVED, the internal cost of carbon is applied to cost analyses that are developed for evaluation of City investment decisions with respect to City buildings, vehicles and mobile equipment, transportation infrastructure, resource management related to wastewater treatment and ecosystem services, as defined in Exhibit A; and
BE IT FURTHER RESOLVED, the Director of the Bureau of Planning and Sustainability is authorized to approve updates to the policy, including applicability of the policy, standardization of emissions calculations, and adjusting the internal cost of carbon to achieve adopted carbon reduction targets; and
BE IT FURTHER RESOLVED, the Bureau of Planning and Sustainability staff will develop and provide detailed guidance for bureaus to implement the internal cost of carbon policy, including standardized emissions calculation tools, and will share these resources with City staff and the general public via the Portland.gov website; and
BE IT FURTHER RESOLVED, the Bureau of Planning and Sustainability staff is directed to conduct regular trainings for City staff on how to apply the internal cost of carbon policy; track its implementation; and modify its implementation based on results, feedback, and Citywide objectives; and
BE IT FURTHER RESOLVED, the internal cost of carbon policy is 37526 intended as the first phase of the City’s climate test policy, and the Bureau of Planning and Sustainability will continue to work with youth and other stakeholders to refine and expand a climate test that applies to other areas where the City has authority; and
BE IT FURTHER RESOLVED, the Bureau of Planning and Sustainability will provide a progress report on the implementation of the policy and recommendations for the next phase of the climate test policy to City Council no later than January 2022; and
BE IT FURTHER RESOLVED, this resolution is binding City policy.
Resolution 37494 and supplemental documents
HISTORY
Resolution No. 37526, adopted by City Council December 16, 2020.