If enacted, the legislation will set a carbon pollution standard against which transportation fuels would be judged. Fuels that don’t meet the standard would generate debts to the producers, while fuels that exceed them would generate credits, which could be sold to the debtors. The standard would gradually tighten.
Fossil fuel producers could meet the standards by blending ethanol into fuels, selling lower-carbon fuels like biodiesel, making improvements to oil refineries, funding carbon-capturing projects or investing in electric vehicles and charging stations. They could also buy credits from fuel producers — including electric utilities — that sell lower-carbon fuels, effectively subsidizing them.
The bill also would require electrical utilities to use some of the money they make selling credits to underwrite new charging stations and build out infrastructure for electric vehicles. As the number of electric cars on the roads grows, the demand for charging stations is expected to increase considerably over the next decade.
The bill faces opposition from the oil lobby, as well as the agricultural and trucking industries, several unions and associations representing the building trades. Almost all the criticism is driven by concerns about potential costs to business owners and consumers.
If fuel prices rise for trucking companies, consumers will ultimately pick up the tab, said Paul Graves of Oak Harbor Freight Lines, an Auburn-based firm employing 1,300 drivers and support workers around the West.
“Working families will pay more not just for a gallon of gas, but for their groceries and everything they buy,” Graves said during a January hearing on the bill. “We think it’s the wrong time to be raising the cost of living across the board for working families, especially when there are better ways to reach our carbon reductions.”
Some Republican objections are grounded in the claim that the bill would have the government, in their view, picking winners and losers. Sen. Doug Ericksen, R-Ferndale, described the fuel standard as “a mechanism that moves money between private corporations to benefit certain activities.”
“The person who is driving an F-150 is going to pay an inflated price for their fuel in order to subsidize a person who is buying an electric car,” Ericksen said.
In a related critique, Hobbs said the standard would push billions of dollars to biofuel manufacturers. The money, Hobbs said Tuesday, “is not going to transportation, it’s not going to the people of Washington. It’s going to biofuels producers.”
Speaking at Tuesday’s hearing, Hobbs said the bill may have a “path forward” if unspecified “off-ramps” are added. The senator did not return requests for comment.
While a clean fuel standard would increase costs for fuel companies, it’s not clear when or whether consumers will feel a pinch. Gas prices swing wildly from month to month and place to place; gasoline in Seattle, for example, sells for about 23 cents a gallon more than the state average, which the Department of Energy pegged at $2.76 in February.
Offering the caveat that fuel prices are “difficult to predict,” a Puget Sound Clean Air Agency analysis found that a clean fuel standard wouldn’t increase the cost per mile for drivers of a gasoline-powered cars — partly because expected increases in fuel efficiency will offset increased costs.
Critics of the proposed standard point to another finding in the 2019 Clean Air Agency report — that the restrictions could, in a worst-case scenario, increase gasoline prices by 22 to 57 cents per gallon by 2030. Diesel fuel, under that analysis, could rise 24 to 63 cents per gallon.
British Columbia, Oregon and California have all had clean fuels programs for years, and those programs haven’t caused spikes in fuel prices.
“It’s not theoretical, but a demonstrated, effective strategy” to combat climate change, said Stu Clark, a policy adviser with the Department of Ecology. “Counter to fears expressed loudly by some, there have been no price spikes, no fuel disruptions and no unintended consequences.”
Proponents of the clean fuel program argue that oil industry interest groups have overblown cost concerns. The price of gas moves with a world market, and already includes hefty profits for fossil fuel companies.
“The oil companies have been among the most profitable companies in human history, and there’s no reason why they need to pass their compliance costs on to the public,” said Fitzgibbon, the bill’s sponsor.
The program will inject competition into a fuel system dominated by a handful of huge oil companies, said Leah Missik, transportation policy manager at Climate Solutions, a Seattle-based advocacy organization.
“For a long time we’ve subsidized the oil industry, and they’ve held a near monopoly as the clean fuels producers have been trying to get their foot in the door,” Missik said. “They’re really fighting this program because they don’t want that competition.”
As pollution restrictions ramp up under the program, it’s expected that fossil fuel companies would increasingly invest in the infrastructure needed to replace gasoline-powered cars and trucks with electric vehicles, Missik said.
So far in Oregon, most fossil fuel producers looking to meet fuel standards have done so by adding ethanol to gasoline and biodiesel to diesel fuel. This reduces the overall carbon footprint of the fuel and allows producers to avoid buying pollution.
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March 19, 2021 at 07:02PM
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Clean fuel legislation could be blocked again by one WA Democrat - Crosscut
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