(Adds lawmakers opposing bill)
By Rory Carroll
SAN FRANCISCO, July 3 A California Democrat on
Thursday introduced a bill he believes will keep gasoline prices
down by delaying the expansion of the state's carbon
cap-and-trade program, a move that has angered
Assemblymember Henry Perea said a three-year delay is needed
to ensure that the state does not raise billions of dollars
through the sale of carbon permits to fuel suppliers at the
expense of residents struggling to get back on their feet after
a long recession.
"In some areas of the state, like the Central Valley,
constituents need to drive long distances and they will be
disproportionately impacted by rising gas prices," said Perea,
who represents Fresno.
Analysts expect the program's expansion to raise gas prices
by about 12 cents a gallon next year.
But the state agency that oversees the program said adding
fuels to the program is essential if the state is to meet its
carbon reduction target of 1990 levels by 2020.
"The cap-and-trade program is part of a group of
complimentary programs to reduce greenhouse gas emissions from
California sources to help manage climate change," said Dave
Clegern, a spokesman for the California Air Resources Board.
"Our projections indicate that by 2020 these programs will
lower the cost of driving by about $400 a year per motorist," he
Also on Thursday, a group of 32 state lawmakers released a
letter calling a redesign of the program "unacceptable" and
business-as-usual reliance on fossil fuels "unacceptable."
Environmentalists blasted the bill, calling it an
eleventh-hour attempt by oil companies to get out of the
program, which they have long opposed.
"It is disappointing that some members of the legislature
are succumbing to oil company scare tactics, ignoring
California's trailblazing efforts to reduce carbon pollution and
the real-time economic benefits they are delivering to their
constituents," said Adrienne Alvord of environmental group the
Union of Concerned Scientists.
California's cap-and-trade program has since 2013 required
large manufacturers, oil refineries and power companies to
account for the carbon emissions by either ratcheting down their
emissions or acquiring carbon permits.
Quarterly permit auctions have netted the state over $700
million so far, money that will be used to fund low-income
housing near public transportation hubs as well as the state's
planned high-speed rail project.
Keeping transportation fuels out of the carbon market would
cut the amount of revenue the state could expect to raise from
the program in future years.
The carbon market shrugged off news of the bill's
introduction on Thursday. Carbon permits for December delivery
were offered at $11.95 each on the secondary market on Thursday,
up a penny from the previous day's closing price.
(Reporting by Rory Carroll; Editing by Lisa Shumaker)