Why are we paying so much for gas – and how can we fix it?

It’s been more than a month since the gas prices in Washington became the most expensive in the country – and that ranking hasn’t changed. Currently, the average price of regular gas in America is $3.69 per gallon whereas, in Washington, it’s $4.93. That’s $1.24 more out of your pocketbook for every gallon.

Meanwhile, Mississippi has the least expensive gas in the country at only $3.19 a gallon ($1.74 or 35% less expensive than in Washington). Even our neighbors are paying less. In Idaho, drivers are only paying $3.88 and Oregon comes in at $4.59. It’s no wonder these prices have made our state a national embarrassment. 

While this has been a shock to our budgets, this was the predictable result of Inslee’s cap-and-trade program, which is essentially a CO2 tax. When considering the tax, lawmakers in Olympia tried to downplay what the results would be. State Department of Ecology claimed that price increases would be minimal – a claim which was quietly scrubbed from their website – and Inslee said any increase at all would be “pennies.” The experts who warned that gas prices would skyrocket have been proven right. It’s no coincidence that the spike in price happened as the tax took effect. 

Our recent polling found that nearly three out of every four Washingtonians support lowering gas taxes to make them more affordable. One ballot measure in the state is working to “Stop the Hidden Tax” on gas. If passed, it would stop cap-and-trade measures like the one that caused the recent climb in gas prices. 

Meanwhile, Sen. Chris Gildon is calling for changes to rules at the Department of Ecology which would also address cap and trade. He recently called out Inslee for blaming oil companies rather than taking responsibility. “The governor is trying to spin a made-in-Olympia disaster into a conspiracy by oil companies,” he said in a statement. Gildon continued, “The program so far has cost Washington industry $857 million, and that money has to come from somewhere. It doesn’t take a Ph.D. in environmental economics to recognize oil companies are merely passing the cost on to consumers.”

Gildon has written a letter to the Department of Ecology and is asking lawmakers on both sides of the aisle to sign. He proposed a variety of solutions including:

• Making it easier to comply with emissions targets, by slowing the pace of increasingly stringent state requirements.
• Increasing the supply of carbon “allowances” sold at the state’s new carbon auctions, to prevent shortages and bidding wars.
• Technical changes to the carbon allowance auction system, including lower floor and ceiling prices.
• Increasing the supply of no-cost allowances for businesses that compete out of state and internationally, allowing Washington products to remain competitive – and expanding eligibility for the break.
• Developing a system to easily honor fuel exemptions, a promise made to agriculture and the maritime industry when the bill was passed, but left unfulfilled.
• Adopting a temporary rule allowing the program to be suspended to reduce fuel prices, a prudent emergency measure if current trends continue.

Sen. Gildon said, “I think all of these things are worthy of discussing.”

“We can fix this problem without forcing the Legislature back into session,” Gildon said. “Part of the idea behind cap and trade was to force gas prices high enough that people would think twice about driving, or perhaps buy an electric car. But I don’t think many legislators would have voted for it if they knew it was going to be this bad.

“The good news is that the state Department of Ecology can take care of this with a few changes to administrative rules. There are serious problems with the way the program has been configured, and this has become more obvious as time has gone on. This isn’t a matter of price gouging by oil companies, and I think the public gets it.”

Inslee was warned this would happen and denied it. Now that it has happened, he is attempting to shift the blame. Using government power to nudge the public towards a perceived policy aim is bad enough; shoving the driving public off a government imposed cliff with no cost effective alternative is incompetent and irresponsible. Meanwhile, Washingtonians are suffering at the pump, in the supermarket, and when purchasing anything that needs to be transported. Let’s support solutions that promise relief for our residents.