New Research Shows, Once Again, that Oil Companies’ “Chicken Little” Claims are Unfounded and Self-Serving.

by Susan Frank, Director, California Business Alliance for a Green Economy

You may remember that earlier this summer, the Western States Petroleum Association (WSPA) – a lobbying group that represents the oil industry – commissioned a study on AB 32’s cap and trade and Low Carbon Fuel Standard (LCFS) provisions. Unlike previous peer-reviewed analyses, the WSPA report predicted that the LCFS would hurt California’s economy. Because the findings of this report were such extreme outliers, compared to other analyses of the LCFS’s economic ramifications, we asked the highly-regarded technology development and consulting firm, TIAX, to evaluate the study. Not surprisingly given the study’s sponsor, TIAX found several significant inaccuracies and faulty assumptions in the report – enough to call the entire study into question.

Well, now a new study from TIAX – commissioned by the California Electric Transportation Coalition (CalETC) – shows that, in the early years of the program, oil companies could comply with the LCFS almost entirely by purchasing credits from the electricity sector. And that’s true even if they only focus on public transit, rail, forklifts, and refrigeration units, which for regulatory purposes are part of the LCFS.

This new TIAX/CalETC study rings true – and we all know that electricity makes economic sense given it costs about 75 percent less than gas or diesel when used as a transportation fuel. In California, electric transportation is much cleaner than gas or diesel fueled transportation, in terms of carbon and other pollutants. Eileen Tutt, executive director of CalETC said it best in releasing the new report: “California is on the path to a diverse clean fuel future that promotes economic growth, clean air, energy independence, and climate protection. Our state’s pioneering clean fuel standard is a key building block, and it shouldn’t be weakened.”

Let’s recap – WSPA and its allies consistently spout that California’s business community is united in opposition to the suite of policies associated with AB 32, including the LCFS. In reality, the opposite is true – other than the oil industry and old manufacturing, the business community strongly supports these policies. WSPA and its friends that continue to speak out in defense of the status quo are those tied to traditional energy sources and highly polluting technology.

The Business Alliance, which represents thousands of employers and hundreds of thousands of California workers, is proud to join organizations like CalETC and others in supporting the move toward a clean and efficient economy, powered by clean sources of energy.

There is plenty of evidence that AB 32 and the LCFS are tremendous economic drivers – a new gold rush for California. Affordable, available technology exists to meet these standards, and don’t let those who want to protect the dirty energy sources of the past convince you otherwise.

© California Business Alliance for a Clean Economy

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