CALIFORNIA’S FUEL PRICES WILL INCREASE
An effort in the California legislature to postpone the inclusion of vehicle fuels in the Cap-and-Trade program was killed by Senate President Pro Tem Darryl Steinberg (D). Therefore, the program will go forward on January 1, 2015, as will our fuel prices.
Fuel refineries in the state (remember California has a unique blend of fuel that is only refined in California) will have to purchase carbon credits from the Cap-and-Trade market to offset their emissions. In turn, they will pass along this increased cost to the distributors, who will pass along to the retailers, who will pass along to the consumer.
It is estimated the initial increase will be $0.13-$0.18 per gallon. The cost in the short and long term will depend upon the cost of carbon credits.