Governor Brown wants to use cap and trade fees to help pay for the state’s high speed rail project.  Those fees are assessed against enterprises in California that emit greenhouse gases and are supposed to be spent to reduce greenhouse gas emissions. Governor Brown argues that the bullet train will reduce greenhouse gases, so spending the cap-and-trade fees is legit. And helps fill the moon-sized crater in the bullet train project’s funding plan.

But a new analysis by the Reason Foundation finds that if the project is at best a lousy and expensive way to reduce greenhouse gasses, and at worst, would on net, increase greenhouse gas emissions.

The High Speed Rail Authority says that by 2040 the train will reduce GHG emissions by 1.54 million tonnes per year.  But they get that figure by assuming nothing else will change. That over the next 25 years neither cars nor automobiles will get more fuel efficient according to their forecast.

The Reason study looks at two more reasonable scenarios. First, we look at the actual GHG reductions brought about by high speed trains in Asia and Europe. Based on their track records, it is more likely that the California bullet train might reduce GHG emissions by about half a million tonnes per year by 2040–one-third what High Speed Rail Authority predicts.  But more realistically, we take into account the current trends in improving fuel efficiency and thus falling GHG emissions of cars and airplanes and forecast that the California bullet train would at best reduce GHG emissions by 0.12 million to 0.25 million tonnes annually in 2040.

So realistically it will take 25 years to see these very small GHG emission reductions, meanwhile during that time the construction of the high speed rail line will emit tens of millions of tonnes of GHGs.  Since AB32, which creates the cap and trade program, is aimed at reducing emissions of GHGs by 2020 in California it just does not make sense to use those funds for the high speed rail project.  Indeed, one could argue that while it is being constructed, the high speed rail project should be paying cap-and-trade fees, not be funded by them.

If you’d like a copy of the Reason study, email