CARB’s bait-and-switch on climate change

When California’s signature climate change program was nearing its expiration date, there was serious debate about whether to extend it. This program, called cap-and-trade, reduces carbon emissions but it also increases the costs of gas, electricity, and numerous other necessities.

That’s a significant problem in a state known for high taxes, onerous regulations, and the worst small business climate in the country.

Fortunately, our elected representatives were able to work across party lines to craft reforms that would contain costs. With these safeguards in place, the Legislature voted last year to extend the life of cap-and-trade for another decade. This bipartisan legislation, AB 398, proves California can cost-effectively shrink our carbon footprint without shrinking our state’s economy.

The higher the cost for the state’s climate program, the more small businesses and their customers are impacted

But now the unelected bureaucrats tasked with implementing cap-and-trade are ignoring those reforms.

It appears they read the part of AB 398 about continuing cap-and-trade for another ten years, but missed the part about minimizing costs. This agency, the California Air Resources Board (CARB), is proposing regulations which open the door to unchecked cost increases on your gas, electricity, food, and other essentials.

CARB’s own experts have found cap-and-trade creates costs which impact the average Californian every time they fill their gas tank or pay the utility bill. But these costs also hit the businesses that grow their food, produce their products, and sign their paychecks. Altogether, these burdens add up to boost our state’s notoriously high cost of living and poor climate of business growth.

These burdens also disproportionately impact small businesses.

Cap-and-trade is sometimes considered a more business-friendly approach than other regulations because it gives regulated businesses options. Large industrial emitters can either lower their carbon emissions or purchase credits. But that flexibility only applies to the big businesses that are being directly regulated. Either way, they incur costs that are passed down to their vendors, contractors, and customers (i.e., small businesses), which are not afforded the same wiggle room.

The higher the cost for the state’s climate program, the more small businesses and their customers are impacted. We must simply pay the costs that are passed down to us. Small businesses also operate on tighter margins, making it more difficult to absorb sharp price increases while still sustaining good-paying jobs.