Washington Gov. Inslee Denies Study’s Low-Carbon Fuel Costs

Published February 19, 2014

Washington Gov. Jay Inslee (D) sent a letter to state legislators taking issue with a U.S. Environmental Protection Agency study concluding a low-carbon fuel requirement would increase fuel costs. Inslee is championing a low-carbon fuel requirement as part of a strategy to reduce greenhouse-gas emissions in the Evergreen State.

Inslee Commits to Fuel Restrictions
Inslee has pledged to enact a low-carbon fuel requirement for Washington. The move came as a state government-commissioned bipartisan climate panel, the Climate Legislative and Executive Workgroup (CLEW), attempted to hammer out an agreement on the most cost-effective strategies for reducing the state’s greenhouse-gas emissions.

Inslee’s pledge to enact a low-carbon fuel requirement and his refusal to rule out taking executive action on the issue prompted Rep. Shelly Short (R-Addy) to introduce a bill prohibiting the governor from issuing an executive order imposing low-carbon fuel requirements.

EPA Documents High Costs
According to a recent CLEW report, a low-carbon fuel requirement would impose costs of between $103 and $131 to reduce one ton of carbon dioxide emissions, translating to a price hike of $1.17 per gallon of gasoline. The report comes in at the low end of studies on the topic. According to the Washington Policy Center, a National Bureau of Economic Research report puts the cost in the range of $307 to $2,272 per ton.  This would amount to an additional $3 to $22 per gallon of gasoline.

Inslee disputed the accuracy of these estimates and any claims that low-carbon fuel requirements will raise fuel costs.

“I don’t understand your contention that ‘my proposal’ would cost anything, let alone in excess of a dollar per gallon. What’s more, studies show that a properly constructed, clean fuel standard could actually save money at the pump,” Inslee wrote.

Higher Fuel and Refining Costs
A low-carbon fuel requirement mandates producers offer a mix of what are referred to as “clean” fuels, such as biofuels, biodiesel, or natural gas. The requirement not only forces fuel providers to use the more expensive fuel sources, but it also adds steps and costs to the fuel refinement process. 

Assault on Canadian Oil
“A low-carbon fuel requirement is nothing less than a new tax on oil and a huge tax on oil from Canada’s oil sands,” said Daniel Simmons, director of state policy at the Institute for Energy Research.

Simmons noted many anti-Keystone XL pipeline activists are supporting a low-carbon fuel requirement as a backdoor attempt to shut down Canadian oil imports. Anti-Keystone activists claim oil from Alberta’s oil sands involves modestly higher carbon dioxide emissions than oil imported from the Middle East.

“Why the State of Washington would want to import more oil from the Middle East instead of oil from Canada is beyond me, but that’s the impact of the low-carbon fuel standard,” said Simmons.
Bonner R. Cohen, Ph. D., ([email protected]) is a senior fellow at the National Center for Public Policy Research.