January 26, 2009
Brian Kennedy (202) 346-8826
Chris Tucker (202) 346-8825

IER: President’s Adoption of California Model on Energy Means Higher Costs, Fewer Jobs for Rest of America

Washington, DC
– Institute for Energy Research (IER) president Thomas J. Pyle today issued the following statement on President Obama’s decision to allow carbon regulators in California to saddle the American auto industry with massive new cost and compliance burdens likely to be paid for by taxpayers and energy consumers across the country:

“At a time when taxpayers have already been asked to send billions of dollars to Detroit to save the American auto industry, the president’s decision to impose what amounts to a $1,050 tax on all new cars may render that investment moot. Unfortunately, for as high a price as Americans will now pay to comply with California’s carbon mandates, there is very little evidence that carbon emissions will actually go down as a result  – and even less to suggest our climate will be affected. In fact, if all cars and trucks in the United States were forced to adopt this standard, the emissions increases from the rest of the world would more than replace the reductions envisioned by this plan. By June. Of this year.

“Few states depend more on others for energy than California. Few states ask its citizens to pay more for their electricity. Today’s announcement ensures that working-class Californians will also have a harder time affording cars in the future. This is the California model on energy – a policy that’s led to the hemorrhaging of jobs and the near-bankruptcy of the state.  If this is a policy President Obama wants our nation to follow, we should prepare ourselves now for similar results.”

NOTE: Today, President Obama instructed the Environmental Protection Agency (EPA) to review the December 2007 denial of California’s request to create its own emissions standards for automobiles. The California Air Resources Board has estimated that the mandate will add at least $1,050 to the cost of each car and will cause the auto industry to slip further behind the technological curve as it struggles to adjust to California’s whims rather than needed efforts to retool to meet the imperatives of customer choice.

More from IER on the California energy model:

The Institute for Energy Research (IER) is a not-for-profit organization that conducts intensive research and analysis on the functions, operations, and government regulation of global energy markets. IER maintains that freely-functioning energy markets provide the most efficient and effective solutions to today’s global energy and environmental challenges and, as such, are critical to the well-being of individuals and society.


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