Washington CO2 price jumps again, reaching 50 cents per gallon

The results of the latest auction of CO2 allowances were announced and the price continues to rise, increasing 12 percent above the amount from just three months ago. The price hit $63.03 per metric ton of CO2, which amounts to about 50 cents per gallon of gasoline and 61 cents per gallon for diesel.

The high price again exceeded the cost containment cap, triggering another special auction to put additional CO2 allowances on the market in an effort to reduce prices. Washington has surpassed the cost containment cap twice in just three auctions. California has never done that in the decade their system has been in place.

There are growing indications that the Climate Commitment Act (CCA), the formal name of the tax on CO2 emissions, is broken. … Once again, Washington politicians have chosen an extremely expensive and relatively ineffective policy. …

Washington’s climate law needs a significant overhaul, because even Ecology’s low projections show costs increasing through 2030. …

Elected officials should encourage all CO2-reducing innovation in order to meet the state’s climate goals at an affordable price. The Governor and legislators don’t want that, however, because although allowing innovative approaches to cut emissions would help meet Washington’s CO2 targets, the money for those projects doesn’t go to the state. It is clear that the Governor is prioritizing increased taxes over reducing CO2 efficiently.

At this point it is unlikely that the Governor or legislators will take steps to reduce the burden of increasing energy costs on families and business. Denial and distraction are likely to be their preferred strategy. And energy costs will keep rising.

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