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Gas tax for warming? California mulls idea

An advisory panel appointed by California’s governor urged the state Thursday to impose a new tax on gasoline, diesel fuel and other petroleum products to fund efforts to reduce greenhouse gas emissions.
/ Source: Reuters

An advisory panel appointed by California’s governor urged the state Thursday to impose a new tax on gasoline, diesel fuel and other petroleum products to fund efforts to reduce greenhouse gas emissions.

Any such surcharge would have to be passed by the state legislature. But the blue-ribbon panel’s recommendation once again sets the nation’s most populous state apart from the Bush administration on a key environmental issue.

And it comes as 10,000 delegates meet in Montreal this week at a U.N. conference to combat global warming.

The California report, drafted by the Climate Action Team, a 15-member panel appointed by Republican Gov. Arnold Schwarzenegger, is not binding.

“The question is whether the governor will embrace (the full report) and work with the legislature and make it happen,” said Bill Magavern of the Sierra Club in California.

Schwarzenegger’s office emphasized that the report is a draft to be amended after public comment leading to a final report expected in late January, but declined comment specifically on the petroleum fuels charge.

The “public goods” fee would be similar to a surcharge already folded into California electricity and natural gas bills.

“The only fossil fuel that doesn’t have a public goods charge in California is oil. Natural gas and coal are already covered,” said Ralph Cavanagh, energy program co-director for the Natural Resources Defense Council.

Cavanagh said the precedent set by the fee linked to electricity and natural gas bills has a history of bipartisan support in the California Legislature.

If the new tax is implemented on par with the existing public goods charges on electricity production, it would be about 2.6 cents per gallon of gasoline or diesel fuel, the report said.

Using that figure offered in the report, the owner of a car or truck traveling 12,000 miles per year getting 20 miles per gallon would pay about $15 per year.

The surcharge on petroleum products “would provide funding for key strategies that will reduce climate change emissions and reduce the dependence on petroleum,” the 96-page report released Thursday said.

Greenhouse gas emissions have been linked to global warming.

The draft report is an outline toward meeting the state’s ambitious goals to cut greenhouse gases announced five months ago.

The California targets call for the state to reduce emissions of carbon dioxide, methane and other gases to 2000 levels by 2010, or by 11 percent, to 1990 levels by 2020, or by 25 percent, and to 80 percent below 1990 levels by 2050.

To reach those goals, the report outlines how the state can cut 62 million tons of carbon dioxide emissions by 2010 and 188 million tons by 2020, from current levels.

“This report clearly reaffirms the feasibility of the targets the governor established in June,” Sierra Club’s Magavern said.

California’s automobile emissions are not recommended for change in the report. In September 2004, California adopted the nation’s first rules to reduce car and truck emissions linked to global warming, which have since been adopted by other states.

Those auto emission rules go into effect for the 2009 model year unless legal action from the Alliance of Automobile Manufacturers can stop it. The rules call for cuts as much as 25 percent by 2009’s model year and for cars to cut by as high as 34 percent by 2016.

There is no call for a new tax on carbon dioxide emitters, such as power plants.

The report says a “cap-and-trade” program involving big factories such as power plants may work in California, but stops short of recommending one. A “cap-and-trade” program would allow companies to trade on the open market “emissions credits” if they fall under state emissions guidelines.

Such programs are used extensively by electricity producers in the European Union, but a California program needs more study, the report said.