Florida should think twice about following California's machiavelian anti-carbon regulation of petroleum products. The fact is, the rising cost of gasoline in the Golden State is straining an already choking economy, laying a world of hurt on families, businesses and individual quality of living. And it is directly related to the state's anti-global warming policies.
The rest of the nation averages $2.76 a gallon at the pump -- a 25 percent plunge from last summer's prices. But Californians pay an average $3.88 a gallon.
It's worse than that in Los Angeles, where last week the average price of regular gas shot up 65 cents, to $4.30 a gallon. That's about 20 cents higher than a year ago. According to GasBuddy.com, prices surpassed $5 per gallon at some stations, hitting $5.49 in downtown L.A.
What's going on out there? The Wall Street Journal claims it's billionaire Tom Steyer with his "cartel of green activists and liberal politicians" -- they're what's going on out there. The Journal ran an eye-opening, explanatory story during the weekend, "Sky-High California Gas Prices Have a Green Additive." The writer was Allysia Finley, one of the Journal's editorial writers. It tells all.
Steyer & Co. are blaming "collusion among putatively monopolistic oil companies," the WSJ reports. But "the real culprit is anti-carbon regulation promoted by a cartel of green activists and liberal politicians that is aimed at raising energy costs to discourage consumption. Sticker shock at the pump, like water rationing and high electric rates, is the price Californians must pay for their environmental virtue."
The Journal claims during most of the 1980s and ’90s, Californians paid about the national average for gas. But since 1999, when Democrat Gov. Gray Davis ended16 years of Republican leadership, California gas prices have steadily and sizably risen above the national average. Why? Because of more stringent fuel regulations and 12 cents-per-gallon higher gas taxes than the national average.
The Journal also points out that Davis' administration 1) banned the fuel additive MTBE -- a smog-reducing oxygenate that has been detected in low quantitites in groundwater; 2) adopted cleaner “reformulated” fuel standards that raised production costs; and 3) began the layering of a myriad other environmental mandates into the state’s fuel standards.
"The results? By 2006 Californians were paying 23 cents more than the national average for regular gas. The disparity increased to 40 cents in 2014 and now sits at $1.11," writes Finley.
Here are some of the developments complicating the situation for Californians trying to live on a budget:
- Electric rates, same as gas prices, have shot through the roof -- all because of the state’s mandate that requires renewables make up 33 percent of the state’s electricity by 2020. Gov. Jerry Brown and Democratic legislators have proposed raising the mandate to 50 percent by 2030. Electric rates are now about four times the state rate nationally, with more solar and wind power coming on line.
- Nuclear energy plants have been decommissioned; hydropower is down because of the drought.
- California's 2006 global-warming law, AB32, "established a cap-and-trade program that requires large industrial companies operating in the state to cut their carbon emissions or buy permits. Cap-and-trade auctions commenced in 2012, but this year refiners have to buy permits," the Journal story explains.
- Only 14 refineries in California produce the state’s pristine-burning fuel. Most of those operate at near-full capacity to stay cost-effective. Few refiners outside the state blend California’s reformulated fuel.
- "In most of the country, a problem at one refinery won’t significantly affect retail gas prices. But in California," says the Journal, "when one refinery shuts down, others can’t pick up the slack. And it can take weeks to import refined fuel by tanker."
- The latest problems contributing to this year's swoon were an explosion at an Exxon Mobil refinery in Torrance, and a labor stoppage at a Tesoro plant in Martinez. Gas prices shot up nearly a dollar as a result. It took imported oil to help cover the supply-demand gap.
Californian Brian Stephens, reacting to Finley's story, said he can't afford to stay in California but he can't afford to leave right now either. "This ticks me off. The state's cap-and-trade program is gouging me on electricity, too. PG&E sends me bogus monthly statements that my electricity is above regular homes. How the hell could it be?," he asks. "I live alone and the house is not even occupied during most of the day Monday through Friday.
"But it's the carbon tax. They are lying to me. Sacramento raised taxes on energy producers and the energy producers are passing the cost increases on to me but dishonestly, as a punitive measure like it is my fault for living when my energy usage is lower than most. It is fraud and this should be illegal."
Only two months ago California's Democratic state legislators held hearings to “investigate” the price spike. That's when San Francisco hedge funder Steyer demanded subpoenas of oil-industry executives.
“As everyone knows, the oil companies have been charging Californians up to $1 billion per month more for gasoline than if we paid the national average,” the billionaire environmentalist claimed. “It’s time to put an end to the Big Oil giveaway.” His idea for a fix? An oil-extraction tax.
In concluding her story, Finley says this:
"Here’s a better idea: Mr. Steyer and his liberal friends in Sacramento should take the stand to explain why they’re gouging consumers to indulge their rich green appetites."
The Journal story leaves nothing to the imagination. Florida does well to resist the particular charms of Tom Steyer.
Reach Nancy Smith at nsmith@sunshinestatenews.com or at 228-282-2423. Twitter: @NancyLBSmith
