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‘Cap-and-Invest’ raises gas prices without doing anything for climate

Sacramento has a problem with Cap-and-Invest, the “climate change” premium that adds at least 20 cents per gallon to the price of fuel in California.

The program works as designed.

It makes energy, fuel, shipping, construction, farming and running a business more expensive.

Then Sacramento pretends to be shocked that California is unaffordable.

The California Air Resources Board is trying to redesign the state’s emissions-trading program, formerly known as “Cap-and-Trade,” and now rebranded as “Cap-and-Invest.”

The name has changed. The policy has not.

Environmental groups say CARB’s proposed changes weaken the program. Oil and gas interests warn tougher rules could destabilize California’s fuel supply. Labor, housing, transit and climate-spending interests worry about losing money for their favored programs.

This is California climate policy’s central contradiction being exposed in public.

If the program is strict, it raises costs. If it is softened, activists say it fails.

If revenues fall, the spending interests built around carbon-auction money, which is raised by selling emissions permits, panic.

At its core, Cap-and-Invest is a government-created market for permission to emit carbon. Regulated companies must buy allowances. Those allowances cost money. The state collects the proceeds.

Companies pass the cost along.

That means higher prices for gasoline, natural gas, electricity, shipping, construction, manufacturing, food and retail goods.

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