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Penalty on carbon emissions

California wants to reduce greenhouse gas emissions to 1990 levels by the year 2020. In order to do that, the state passed a law, known as AB 32, that is the first of its kind in the U.S. Beginning in 2015, the law's penalty on carbon emissions will also apply to transportation fuels, including oil and gas. That means if your car runs on gas or diesel, you’ll pay more.

Exactly how much more? Nobody knows. Apparently state legislators felt compelled to approve the law first and do the math later. They don’t believe they need to share the pesky details with the folks who elected them. Based on input from various industry organizations and consumer groups, it’s estimated that the cap and trade "tax" on carbon emissions has the potential to increase California’s retail gasoline prices from 16 cents to 76 cents per gallon. Most expect at least a 15-cent increase beginning in 2015.

California drivers already pay the highest prices for fuel and the second highest fuel taxes in the country – 68.1 cents, second only to New York’s 68.9 cents per gallon.

According to the California Air Resources Board, which makes a habit of imposing fines on businesses, the tax is a cost for the fuel industry, not necessarily the consumer. Just how disingenuous has the board become? Here’s Exhibit A: “How each company decides that it will accommodate that additional cost into their business plan is entirely up to them,” said a board spokesperson Stanley Young. Young told Bakersfield, California news station KBAK-TV that he cannot speak to how the law will affect drivers. “It’s difficult to predict how the cost of the AB 32 program will impact them,” he said.

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