Consumers should know the whole story
By Representative Alex Ramel
Over the last few weeks, the public has become increasingly besieged by a public relations campaign focusing its attention on gas prices in Washington. I’ve seen billboards, videos, print ads, and an opinion piece here in the Cascadia Daily. Affordable Fuel Washington – an AstroTurf organization–has teamed up with conservative lawmakers, and oil corporations to frame our state’s efforts to turn the tide on climate change as the culprit for high gas prices.
You, your families, and your wallet should be aware of what’s truly at stake here – corporations that stand to profit prefer to blame Olympia when gas prices to go up. Their argument is simply that gas prices are high, and cap and trade started this year. But correlation isn’t causation; you should know the whole story.
The Climate Commitment Act, which passed in 2021 and took effect this year, caps Washington’s overall greenhouse gas emissions and imposes a compliance obligation on large polluters of greenhouse gases like carbon dioxide. For transportation fuels like gasoline and diesel, this responsibility falls upon the fuel supplier.
Fuel suppliers in Washington have largely chosen to pass these costs along to their consumers, instead of accepting slightly lower profit margins. The Seattle metro area is the 2nd most profitable market for fuel suppliers in the United States, with an average profit margin of $1.09 per gallon in December 2022. These same oil companies recorded their biggest profits in history during the first quarter of this year. These same companies started adding a surcharge that they passed on to drivers in January – almost two months before the first cap and trade auction.
Rather than incorporating the regulatory costs of reducing their pollution into their bottom line, oil corporations made a conscious decision to pass that cost on to you and then funded a PR campaign to shift the blame. It’s time to look at the oil industry profits and pricing structure to consider whether corporate practices are legal, appropriate, and fair.
AAA has also reported that fuel prices are also correlated to pre-scheduled maintenance on the BP Olympic pipeline that connects four of Washington’s refineries. We hope and expect that fuel prices will fall once the maintenance is complete and the summer gas price spike subsides. We can also expect to see compliance costs under the Climate Commitment Act decrease once the program has been up and running for longer. Any remaining cost ought to be alleviated by reducing oil company profits rather than increasing burden on consumers. If oil companies won’t take that step on their own, I will work to address it with windfall profits taxes or anti-price gouging legislation.
The polluters want us to repeal the cap-and-trade program, but that won’t help our communities in the long term. What’s truly at stake is hundreds of billions of dollars in damage from natural disasters, reduced crop yields, rampant wildfires, an overstressed healthcare system due to heat fatigue and illness, and much more. These impacts fall hardest of those with the least resources. Acting now to switch to clean, efficient energy can help prevent these long-term costs.
The Climate Commitment Act is already utilizing revenue raised from its first two auctions to help our communities have access to affordable active transportation, alternative fuel and electrification that creates good paying jobs, and modernizing our railways, ports, and ferry systems. Washington is directing investments to decarbonize sectors of the economy, increase building energy efficiency, make Washington a leader in clean hydrogen, and provide funding for local emissions reduction projects. Much of this investment is focused on reducing and eliminating inequalities that have made low income communities last in line for solutions while their first to be impacted by pollution. This funding will tangibly change our community for the better.
Confronting the climate crisis isn’t going to be all easy. But like most problems, it gets worse and more expensive the longer we ignore it. Last week, our planet saw the three hottest days in modern history. Climate change is upon us and getting worse with every delay. If oil companies suggest repealing the CCA, we should ask what they propose to replace it. I believe polluters pay is a fair system, and an efficient way to support the emerging clean economy, a healthy clean energy workforce, and real climate justice.
To read the article on Cascadia Daily News, click here.