Mapping our way to cheaper, cleaner driving
Results from the state’s 3rd auction of emission allowances under the Climate Commitment Act (CCA) were just announced, and per the Department of Ecology, all 8,585,000 of available allowances were sold, at a settlement price of $63.03. This includes, for the first time, 2,927,249 as a consigned volume with revenues allocated to natural gas utilities. The auction raised $356 million in state revenues to invest in direct, high value public benefits including incentives for electric trucks, new hybrid ferries, and thousands of new electric charging stations. Year-to-date state revenue increased to $1.37 billion and the average allowance price through the August APCR and regular auctions increased from $50.32 to $54.38. With the first-time sale of consigned allowances, $184.5 million is retained by utilities to be used for the benefit of ratepayers. The average allowance price remains below the economic modeling “primary analysis” projection of $58.31 but above the estimate used in state budgeting of $32.65.
Also this morning, Clean & Prosperous Washington’s Executive Director, Michael Mann welcomed media and luminaries at MTR Western headquarters to talk about the high cost of transportation for Washington residents and businesses and to propose long-term and durable solutions.
Mann said, “We have been dependent on one source of transportation fuel for over a century and suffer both from price fluctuations that we have little control over and the health impacts to our communities. But fortunately for us, Washington state is the best place in the country to save money by switching to electricity as a transportation fuel.”
Credit: Energy Innovation
The Climate Commitment Act is our opportunity to invest in projects and strategies to reduce demand for fossil fuels and make the energy transition as affordable as possible. To relieve pressure at the pump, lawmakers can use revenue raised by allowance auctions from large emitters to lower costs for consumers while preserving the full environmental integrity of the program.
The CCA is already placing hundreds of millions of dollars towards incentives for electrification of transportation. Allowance auctions provide critical funding for the Move Ahead Washington transportation package building a new and improved hybrid-electric ferry fleet, historic support for multimodal transportation, and free public transit for youth – complemented with road maintenance, preservation, and improvements across the state.
The Climate Commitment Act is working. Regulated parties in Washington are taking carbon reduction seriously and setting the market for greenhouse gas reductions. A price above the floor but below economic projections means the market is working to constrain pollution. The higher settlement prices have had an impact on gas prices because oil companies are no longer getting free access to pollute our skies and waters. An analysis by the Clean & Prosperous Institute shows about a 25 cent per gallon impact – about a 5% increase in gas prices – less than a couple of quarters per day for an average driver.
Oil companies are now running a million dollar effort to convince the Legislature to gut the Climate Commitment Act. Clean & Prosperous Washington believes this is a recipe for continued high and volatile transportation costs, meaning Washington residents and businesses would end up paying more to move people and goods this decade without the program than with the program.
Instead, we are calling on the Legislature to use the revenues from the Climate Commitment Act to lower transportation costs.
We know you can save more money by switching to electric transportation in Washington state than anywhere else in the country.
Now, let’s make Washington the cheapest state to purchase an electric vehicle. Currently, we are way behind our peers on incentives, with the second worst score of the top 14 states in terms of incentives according to the ACEEE’s 2023 Transportation Electrification Scorecard.
We need to SURGE our investments in transitioning to cheaper fuels, a Strategy for the Urgent Reduction of Greenhouse Gas Emissions. Our state purchase incentive for passenger vehicles expires in 2025. We need to improve this program and expand a sales tax holiday to every zero emission vehicle sold in the state for the next two years. Let’s take away the EV fee for all new EV purchasers for the next two years, and implement purchase incentives for medium and heavy-duty vehicles, and rebates for low-income purchasers. For those whose vehicle needs are not served by the current ZEV market, let’s provide some cost relief with CCA funds. We will advocate for an energy-cost bonus to those who qualify for the Working Families Tax Credit and we ask the Legislature to consider other temporary relief measures, like reducing or rescinding car tab fees for the next two years.
The most effective way to reduce the compliance cost of the CCA is to link with the California and Quebec markets. And as long as we accelerate the EV market to a much wider share of Washingtonians in the next five years, most drivers will pay less for fuel between now and 2030 than they would without the program. Going electric is good for our economy. More money is kept in state than spent on imported fossil fuels. This can and should be a win-win, helping fulfill our mission of “accelerating the transition to a clean, more globally competitive economy.”
Join us in supporting a SURGE in transportation electrification incentives.
We have the tools in place to lower transportation costs for all Washington residents and businesses. We are the cheapest place in the nation to operate electric vehicles, at less than $1.50 per gallon. Let’s use the Climate Commitment Act to make Washington the cheapest place to purchase an electric vehicle and bring those transportation cost savings to everyone in the state.