Carbon Tax Assessment Model

The Carbon Tax Assessment Model (CTAM) is an open source model that quantifies the greenhouse gas and fiscal impacts of a carbon tax on the five primary energy sectors. Results from the model helps to provide policy recommendations for Washington State.

We are currently working on updating the functionality, streamlining the model and adding new features.

Since development of the model, it has been improved upon and maintained by staff in the Washington State Energy Office. The Carbon Tax Assessment Model is setup for the State of Washington, but it can easily be adapted for other states.


  • The basis for the WA Energy forecast was changed for 2018. Previously the forecast was based on the Annual Energy Outlook (AEO) Pacific Region Energy Forecast, but challenges in assessing the California contribution to the Pacific region energy forecast compelled us to switch to the 2018 AEO National Energy Forecast. This forecast is less prone to differences in the GHG emission reduction policies of California relative to the other Pacific region states.
  • Altered the energy forecast proration tab to reflect the change from the AEO Pacific Region to the AEO National Energy Forecast. The new proration table is based on ratios of the WA and National 2018 EIA State Energy Data System (SEDS) sector and fuel values. Added sector detail to the proration table.
  • Adopted a 6 yr. averaging period in the proration table to reflect relative changes in population shares, economic activity, energy policies and energy intensity in the AEO National energy and price forecasts (WA population growing faster).
  • Updated the Colstrip and Centralia annual power plant generation capacity and capacity factor to most recent values. Incorporated PSE Colstrip 1 & 2 closure agreement into the baseline forecast.
  • Forced in the WA RPS requirement (I-937) into the WA electricity forecast. Assumed 10% qualifying renewables by 2020. This adds more wind and solar generation than in the previous CTAM forecast. Hydro, coal and natural gas forecast generation values were reduced by an amount equivalent to the additional wind and solar generation.
  • Updated Pacific region energy historical price data. Corrected a minor error in the electricity calculations. 
  • Made several modifications to the price elasticity tab in the CTAM spreadsheet. A few more recent economic studies were added to the elasticity spreadsheet, which slightly modified some elasticity values.  The coal price elasticity was changed to -0.14. Added a price elasticity of substitution to reflect a shift from coal to natural gas fired generation. Reduced several of the stickiness factors in the table to reflect more rapid adjustment to a carbon tax.
  • Added a correction for ethanol added to motor gasoline – assume no emissions for ethanol.
  • Altered the fuel mix for electric power displaced by a carbon tax.  Replacement power/capacity is now a fixed mix of 25% hydropower genr, 50% wind, 12.5% solar and 12.5% biomass.
  • Corrected an error in the dashboard calculation of the percent price increase for electricity following a carbon tax (same percent for all sectors, not reflecting different base prices, elasticities etc.) 
  • Several minor fuels did not have the carbon tax applied. This was probably because during the initial CTAM design in 2011 there were no price elasticity values for these fuels. Used reasonable elasticity proxy values for these minor fuels.
  • Added a carbon tax exemption for Colstrip 1&2, similar to the existing Centralia “transition coal” exemption. Controlled from the Dashboard.
  • Further reduced the impact of heat rate trend analysis for natural gas and coal power plants in the electric section of the Baseline consumption tab. The set of natural gas and coal power plants is changing very slowly and it is not likely plant heat rates will change appreciably over the 22 year forecast period.