Sunday, October 13, 2024

CONFUSION, CONTRADICTION ON GASOLINE PRICE GOUGING

 CALIFORNIA FOCUS

FOR RELEASE: FRIDAY, NOVEMBER 1, 2024, OR THEREAFTER

 

BY THOMAS D. ELIAS
      “CONFUSION, CONTRADICTION ON GASOLINE PRICE GOUGING”

 

At every level of government, there are times when it seems the left hand has no clue what the right hand is doing. Nov. 8 might become one of those confounding times.

 

That’s the date – just three days after the presidential election – reserved by the California Air Resources Board (CARB) for a decision on whether to toughen state rules on the carbon intensity of fuels. The fuel of concern here is gasoline.

 

The more carbon oil refineries bake into the gas they produce, the more greenhouse gas emissions most car engines will spew, thus increasing smog. It has been CARB’s fervent mission since the 1960s to reduce smog in California’s air. That function is even enshrined in the federal Clean Air Act of 1970, signed into law by Republican President Richard Nixon.

 

The problem is that toughening up California’s low carbon fuel standard (LCFS) will make gasoline more expensive. No one knows just how much more expensive, though, and CARB says it is not equipped to analyze what the effect will be on retail gasoline prices.

 

Most estimates, however, suggest a 65 cent per gallon increase if the LCSF is made a lot stricter, as proposed. That would come on top of California’s already high gas prices, which consistently run about $1.20 above the national average.

 

Nobody wants this, especially as California and the nation recover from a strong bout of general inflation.

 

At the very same time, the special legislative session called by Gov. Gavin Newsom this fall to counter gasoline price gouging by refiners has finished its work.

 

Newsom, not incidentally, appoints all CARB board members, and he can fire them anytime. But as he supposedly seeks to lower prices with one hand at the legislative level, an agency he can absolutely control may adopt a tactic guaranteed to increase prices.

 

If that’s not a confused contradiction, it’s hard to see what might be.

 

Newsom has taken heat from several members of Congress from both parties and from the governors of Nevada and Arizona (one Republican, one Democrat), for his plan – passed by the state Assembly and Senate – forcing refineries to maintain significant new reserves of gasoline for use at times when they shut down for maintenance or occasional emergencies.

 

Nevada and Arizona both get most of their gas from California refineries, and their governors fear creating a large reserve will drive pump prices up in those states, both now featuring a host of California emigres.

 

They’re probably wrong, because the reserve would not appear instantly, but gradually. Gas would be pumped into it at times of surplus, not when supplies are tight.

 

While the other governors’ concern is probably groundless, the new reserves are proving politically useful for some in this era of fearmongering politicos. Meanwhile, there is no doubt whatever that a severely lowered LCFS would raise prices.

 

So it’s high time Newsom tells his appointees to hold off on a stricter LCFS. Since he appoints the board members scheduled to vote on this, he can easily and properly tell them at least to delay their action until they know exactly how much it will cost consumers.

 

It's true that CARB does not usually worry about consumer costs, as it is supposed to deal almost solely with air quality and not what it costs. But for CARB to raise gas prices at the very moment Newsom seeks to steady them legislatively makes no sense at all.

 

Besides, there is no great urgency, no public pressure, to lower the LCFS just now, at least nothing like the urgency of the 1960s and 1970s, when banks of smoggy brown air hung over entire regions like Southern California, the Central Valley and (to a lesser degree) the San Francisco Bay Area. Ambient air is cleaner here now. Electric cars produce no smog, hybrids produce only a little and even gasoline engines spew much less than they once did, causing the browned clouds to become much more rare.

 

So it’s time Newsom stays his left hand while his right hand works on preventing gasoline price gouging. To proceed as now scheduled borders on insanity.


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    Email Thomas Elias at tdelias@aol.com. His book, "The Burzynski Breakthrough, The Most Promising Cancer Treatment and the Government’s Campaign to Squelch It," is now available in a soft cover fourth edition. For more Elias columns, visit www.californiafocus.net