The CARB Debate Continues

Joel Fox
Editor and Co-Publisher of Fox and Hounds Daily

In my piece last week discussing concerns with the Low Carbon Fuel Standard, I did not dismiss alternative fuels. Yet, David Crane’s response to my article seems to indicate that I was promoting the exclusive use of oil for transportation fuel into the distant future. I was focused on the present. I argued that the LCSF standards would add to the cost of fuel prices in the here and now, especially when alternative fuels are not ready to meet demands.

David argued that my position banks on the scenario that oil prices would not go up. Oil prices will undoubtedly rise with more demand, new taxation, and with limits put on exploration. Altering the attitude against exploration and preventing tax increases on oil production would lessen the pressure to increase costs.

However, there is also no question oil prices will be raised immediately if the CARB regulations take effect. Limiting the importation of oil by affixing a “carbon intensity” measure to the fuel transported to the California market has to affect the cost of the fuel.

David and I agree that unleashing the entrepreneurial spirit is a must to deal with job creation, as well as solving a whole lot of California’s problems, including assuring adequate fuel supplies.

However, underestimating the costs of alternative fuel development at this time and setting unrealistic goals undercut the best intended objectives and will ultimately cost consumers.

We have to be realistic about pricing and potential payoffs from the entrepreneurial endeavors. CARB seems to be making a habit of projecting overwhelming positive economic results as a consequence of placing new regulations on the market when outside studies project entirely different outcomes, whether the subject is alternative fuels or reducing greenhouse gases.

I go back to my first point in my original article. These LCSF regulations must be vetted more thoroughly to understand their impact on the California economy and consumers.

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