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Just as Exxon Mobil is on trial for accounting fraud, California Governor Gavin Newsom asked his attorney general’s office to “investigate whether a “mystery surcharge” on gasoline prices in the state was caused by oil companies “misleading and overcharging” their customers,” according to the SF Chronicle. In a letter to California AG Xavier Becerra, Newsom cited a new analysis by the California Energy Commission (CEC) that could not entirely explain why gas prices are higher in the state than elsewhere and stated that:
“There is no identifiable evidence to justify these premium prices.”
“If oil companies are engaging in false advertising or price fixing, then legal action should be taken to protect the public.”
Name Brand Gas Premium: The CEC report concluded that name-brand stations (like Shell and 76) are charging higher prices than other gas stations for what appears to be the same product. While California has higher gasoline prices due to environmental taxes imposed per gallon of gas purchased, the hike to $4+/gallon gas prices couldn’t be explained by taxes alone.
Why This Matters: There’s a lot at play when it comes to California and transportation. There’s not known a connection between the Trump administration’s revocation of California’s Clean Air Act waiver and the gas prices investigation but this all comes at a time when California is grappling with how to transition its millions of passenger vehicles to electric while also cleaning up its air and reducing the need for cars. While CA customers shouldn’t be charged more for gas, the arbitrary nature of gas prices further underscores the need to rethink transportation altogether.
While high gas prices have historically diminished the sale of SUVs, these hikes also disproportionately affect low-income Americans. Many experts believe that the best way to switch to greener modes of transportation is to stop subsidizing driving altogether.
Go Deeper: After years of decline, a spike in air pollution may have taken the lives of almost 10,000 additional Americans over two years.
President Trump trumpeted his trade deal with China, but so far it has been a bust, according to The Wall Street Journal — the Chinese have not purchased nearly the amount of energy (in terms of total dollars) as they promised — only $2B in oil and gas purchases against a commitment of $25B for this year.
A federal judge in Washington, DC ruled yesterday that the Dakota Access Pipeline must shut down and empty all its oil until the government completes an environmental review of the pipeline’s impacts, giving the Standing Rock Sioux Tribe, whose reservation lies downstream, a huge victory. Similarly, late in the day, the Supreme Court refused to overturn the order of a district judge that shut down construction of parts of the Keystone XL pipeline so it is also blocked for now.
Why It Matters: The Dakota and Keystone XL news is greatly tempered by the fact that numerous other pipeline projects can go ahead despite their inadequate permit unless they are individually challenged in court and blocked.
Yesterday, Dominion Energy and its partner, Duke Energy, announced they were ending a 600-mile natural gas project that would have cost at least $8 billion to complete. As the Richmond Times-Dispatch wrote, Dominion and Duke canceled the construction of the Atlantic Coast Pipeline in the face of mounting regulatory uncertainty caused by a federal court […]
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