The big fossil fuel companies wanted to avoid paying for the carbon pollution from their products via California’s cap-and-trade program.  They tried to scare California residents about the looming gas price increases.  They found an ally in Assemblyman Henry Perea (D-Fresno), who introduced AB 69 to delay including fuels under the cap.  As I blogged about a few weeks ago, the money for the fuel pollution allowances would fund transit and electric vehicle programs, among other pollution-reducing technologies.

Now good news: State Senate President Darrell Steinberg prevented Perea’s bill from even coming up for a vote.  That avoids the messy political problem of forcing legislators to weigh in on this issue during an election year.  As I wrote about, the gas price increase is likely to be negligible, and there’s no reason oil companies can’t simply absorb the cost from their $200 billion annual profits, rather than passing it along to consumers.

Steinberg wrote a forceful letter to Perea explaining his logic, worth reading in full.  So now fuels will come under the cap on January 1st, and California will use the revenue from the pollution allowances to fund the ongoing transition to a cleaner, cheaper and more sustainable form of transportation.  And once under the cap, it will be difficult for the oil and gas interests to remove it later. Overall, this is excellent news for California’s fight to reduce greenhouse gas emissions and bolster our clean tech sector.