California bill calls for unveiling cap-and-trade costs

By Keith Goble, Land Line state legislative editor | 4/20/2016

Truckers and others fueling in California could soon know exactly how much extra they are paying for fuel due to a one-of-a-kind program in the state.

On Jan. 1, 2015, a state rule was implemented on oil companies. The program allows the California Air Resources Board to cap greenhouse gas emissions and require gas and diesel producers to buy permits to exceed those caps.

Since the cap-and-trade program took effect 16 months ago, the state’s Legislative Analyst’s Office found the program has added 11 cents per gallon in additional costs for gas and 13 cents more for diesel. In all, consumers are paying $2 billion more per year for fuel.

The Assembly Business and Professions Committee voted to advance a bill to give consumers a heads-up on the additional fee associated with the state’s cap-and-trade program when they stop to fuel.

Service stations in the state already are required to display on fuel pumps a list of applicable state and federal fuel taxes.

Assemblyman John Lackey, R-Palmdale, said it is time to include information about the cap and trade program.

“No other state in the country has this cap-and-trade requirement,” Lackey said in prepared remarks. “I think it’s important we understand this measure is taking place and we are actually contributing to our protecting the environment.”

Legislative Analyst Mac Taylor wrote in a letter to Lackey that although the cap-and-trade program increases fuel prices, additional revenues help the state to decrease greenhouse gases.

“Including transportation fuels in the cap-and-trade program imposes additional costs on motorists, but it also generates a significant amount of state revenue that can be used for programs that provide direct benefits to consumers and businesses,” Taylor wrote.

AB2066 awaits further consideration in the Assembly Appropriations Committee.

To view other legislative activities of interest for California, click here.

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