First cap-and-trade auction a bust for California budget

“A low price for credits and minimal demand for future offsets suggest California will see a mere fraction of the $1 billion that Gov. Jerry Brown and lawmakers estimated the state would receive this fiscal year.” [Sacramento Bee]

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6 responses to “First cap-and-trade auction a bust for California budget

  1. Gee, go figure! No one wants to buy a phoney product coming from a market that doesn’t exist to prop up an agenda built on a lie. That’s just mean.

  2. The state wants $1B + administrative fees on that added to energy costs. I think they might just discourage meaningful energy development attract rent seekers, add way more than $1B to energy costs, and not see much of it themselves. Hat trick!

  3. Invest in indulgences, or spend the money on a move to AZ or NV.

    BTW, LAO is Legislative Analyst’s Office. Bugs me when professional writers use abbreviations without first defining them, assuming readers will know what they mean. I’ve never heard of them; I spose they are something peculiar to California.

  4. Jerry better start looking for other means of financing for the high speed rail that cap and trade was supposed to provide.

  5. Part of the reason CA unemployment is so high compared to the rest of the nation, is that high energy users have made a great effort to stop manufacturing in the state. Companies, like Boeing are abandoning plants that have been in use in CA since the 1940’s. It is actually quite sad.

    So, yeah, who is buying these credits – probably no-one but utilities, who might be buying them, more for the political benefit, rather than actual need.

    • If the utilities are regulated monopolies with guaranteed rates of return (likely), the cost will be passed on to rate payers. Zero incremental cost to the utility.

      The original idea was that if companies had to pay for carbon they emit, these would encourage them to reduce emissions. As the cost will come out of the rate payers’ pocket, and not the utilities’, no incentive is created. As this should be rather self-evident, this whole thing may just be another tax, wrapped in a green cloak to get the people to accept it.

      The problem with CA, as well as the U.S., is not revenue, it is spending. Adding a tax so they can continue their spending is destructive. Probably what we’re going to get out of Washington, too. People are sufficiently scared by the “fiscal cliff” talk that they will accept anything from DC labeled as saving us.

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