SB 324 is about to cause your gas prices to skyrocket!
Oregon State Senator Doug Whitsett, Klamath Falls District 28
February Newsletter 2015
A public hearing on
Senate Bill 324, the adoption of an Oregon low carbon fuel
standard, was scheduled for the very first day of the 2015
Legislative Assembly. The timing of the hearing appears to
signal that the majority party simply cannot wait to test its
newfound supermajority voting muscle.
LCFS was first enacted by a Democrat supermajority in 2009
through the passage of
HB 2186. That bill passed without a single Republican vote
in either the House or Senate, and was also opposed by some
Democrats in those chambers.
HB 2186 granted broad authority to the Oregon Department of
Environmental Quality (DEQ) to regulate greenhouse gas emissions
and evaluate similar programs being done by the federal
Environmental Protection Agency and the states of California and
Washington. It also defined the term “low carbon fuel standards”
and allowed DEQ to adopt, by rule, standards for gasoline,
diesel and fuels that could be used as substitutes for them.
Those standards are also applied to greenhouse gas emissions
that could be attributed to fuels throughout their lifecycle,
including their production, storage and transportation.
The law required that its provisions expire, or sunset, at the
end of 2015. No fewer than three bills,
HB 2237 and
HB 2791, were introduced during the 2013 regular sessions to
extend the sunset. All three failed to pass.
The alleged purpose of the low carbon fuel standard is to reduce
the “carbon intensity” of fossil fuels. Once implemented, the
standard would maximize the blending of so-called lower
intensity alternative fuels into standard gasoline and diesel.
Producers of ethanol, biodiesel and other biofuels will be given
“carbon intensity credits” for their production of “renewable”
energy products. Conventional suppliers of gasoline and diesel
will be forced to purchase these “carbon intensity credits” to
“mitigate” their carbon dioxide emissions.
One fact is abundantly clear regardless of stated intentions by
supporters of the bill: Everyone that purchases gasoline and
diesel fuel will ultimately be required to pay the increased
costs resulting from the purchase of those credits.
DEQ estimates that applying the low carbon fuel standard’s
artificial cost enhancements to fossil fuels will increase the
price of gasoline by about 19 cents per gallon at the pump.
However, consumer user groups are estimating the cost of
compliance with the low carbon fuel standard to be much closer
to $1 per gallon of fuel.
The hidden fuel tax would be rolled seamlessly into the price at
the pump, because under the current provisions of the bill, no
notification of the covert tax is required to be provided to
consumers. Most Oregonians won’t even realize that they are
paying an extra $2 to $20 to fill up their gas tanks.
In a recent article, the Oregonian editorial board stated:
“What has always been misguided policy, driven by
misrepresentation from the governor’s office on down, now
carries a depressingly familiar stink…the low-carbon-fuel
standard is opaque and costly…it is a roundabout way of taxing
gasoline and diesel fuels to subsidize alternative road fuels
such as ethanol, biodiesel, and other biofuels.”
It is no surprise that the producers of these alternative fuels
are among the strongest supporters of the low carbon fuel
standard. They will also receive virtually all the direct
financial benefit from the hidden fuel tax.
Governor Kitzhaber and his supporters continue to claim that the
low carbon fuel standard will SAVE Oregonians up to $1.6 billion
over the next ten years. The Oregonian editorial board also
pointed out that the governor “conveniently failed to mention”
that achieving such savings would require spending an equal $1.6
billion on alternative fuel powered vehicles. His selective use
of data belies the fact that the same article that reports the
potential $1.6 billion in savings also prominently states that
the savings is dependent upon the expenditure of $1.6 billion
for alternative fuel vehicles.
I have to categorically agree with the editorial board’s opinion
that “opacity sold by half-truths is cause for alarm.”
At the end of the day, the low carbon fuel standard is not
really about saving the planet. Oregonians comprise only about
five ten thousandths (0.0005) of the global populace and only
1.3 percent of the population of the United States. Even the
complete elimination of ALL Oregon greenhouse gas emissions
would not result in a measurable difference in global emissions.
The low carbon fuel standard proposed under SB 324 is not about
social justice, either. Families living at or near poverty
levels spend the highest percentage of their income for energy.
In fact, Oregon’s poorest families will suffer the greatest harm
by forcing artificial and unaffordable increases in energy
prices upon them.
The low carbon fuel standard represents little more than a
political scheme to social-engineer huge subsidies for
alternative fuel suppliers. Not surprisingly, many of those fuel
suppliers provide enormous political contributions to compliant
The low carbon fuel standard is a political partisan issue. I do
not expect a single Republican to vote to enact the standard.
The only way it can be created is by a party-line Democrat
Oregonians concerned about this misguided policy would be wise
to contact their state representatives and senators and urge
them to oppose SB 324. The outcome of this legislative session
will depend largely upon participation from the public. That’s
especially important, as an emergency clause currently attached
to the bill would make it effective immediately upon passage and
prevent citizens from being able to challenge and repeal the law
through the referendum process.
People need to make their voices heard; otherwise, we may end up
with laws like SB 324 that will ultimately undermine the
prosperity and well-being of working people throughout the
Please remember--If we do not stand up for rural Oregon, no one
Senate District 28
Email: Sen.DougWhitsett@state.or.us I Phone: 503-986-1728
Address: 900 Court St NE, S-311, Salem, OR, 97301 Website:
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