New study says cap and trade would add $2.41 to a gallon of gas

• Lawmakers considering big taxes on fuel during final hours of 2021 legislative session
• New study says cap and trade could increase costs $2.41 for gas, $2.75 for diesel
• Cost per household: $2,050 a year
• Would add to existing taxes of 67.8 cents, proposals for low carbon fuel standards and gas tax hike

OLYMPIA – A new study says a cap and trade program under consideration during the final hours of the 2021 legislative session would add $2.41 to the cost of a gallon of gas within a few short years.
The study, from NERA Economic Consulting, says SB 5126 would increase the cost of gasoline in Washington state by $1.81 a gallon by 2024 and $2.41 a gallon by 2030.

The study also says the bill would increase diesel costs by $2.07 a gallon by 2024 and $2.75 by 2030.

“This is important information my fellow lawmakers need to know,” said Sen. Doug Ericksen, R-Ferndale. “The new costs imposed by this measure and others under consideration could add a dollar or more to the cost of gas.”

The cap and trade measure is one of three big new taxes on fuel being considered by the Washington Legislature as lawmakers prepare to adjourn on Sunday. Lawmakers also are considering a low carbon fuel standards bill and an increase in the state gas tax.

The NERA estimate assumes Washington would go it alone in creating a program requiring refiners and other industries to purchase “allowances” for carbon emissions. The study says the cost of a single-state program would be $2,050 a year for each household in Washington state by 2030. Cost would be $1,400 under a California-driven multi-state program.