Gas prices in California will likely rise after the first of the year due to costs associated with the state’s greenhouse emission law.
California drivers may have seen the last of the ever-sinking gas prices for a while. Starting Jan. 1, the state’s landmark greenhouse-gas emissions law will force gasoline and diesel producers to either supply lower-carbon fuels, which are more expensive to produce, or buy pollution permits for the greenhouse gases created when the fuel is burned. Either option is likely send gas prices soaring, although how much is still unknown.
Groups backed by the oil industry have claimed prices will rise by 16 to 76 cents per gallon shortly after Jan. 1. A Cal-Berkley energy and economics expert claims the increase will be more in the 9 to 10 cent range.
The Global Warming Solutions Act of 2006 called for phasing in a cap-and-trade program, economywide, to limit major greenhouse-gas sources such as refineries, power plants, industrial facilities and transportation fuels. The cap is lowered by about 3 percent each year to steadily reduce the state’s overall emissions. Industries in the program must reduce their emissions or buy pollution permits.
Some Democrats want to delay the program while most Republicans want to scrap the law altogether. California Governor Jerry Brown strongly supports the law, making either outcome unlikely.
Money from the permit auctions goes to the disadvantaged parts of the state and will pay for energy-efficient affordable housing, mass transit, cleaner cars and more.
Some self proclaimed grass-roots groups, many of which have ties to the oil industry, have gathered petition signatures, organized letter-writing campaigns and exerted other pressure to halt what they call a “hidden gas tax” that will hurt ordinary Californians.
Even some Democrats urged the Air Resources board to delay the charges. The board claims the program has been phased in since 2011 on a schedule set after extensive hearings. The board also claims that the new program will help clean air in areas such as the Central Valley where transportation fuels account for nearly 80 percent of the state’s smog-causing pollution.
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