Well, it’s been an insanely fast start to the new year, so apologies for my tardiness concerning blog posting. And, what an interesting new year it’s been thus far. I’ve been tracking a curious set of battles transpiring in California where they are simultaneously and unilaterally attempting to implement cap and trade as well a new low carbon fuel standard (LCFS).

California Cap-and-Trade Revolt

Domestic Fuel - Ethanol Groups Reacts to California LCFS Rule

From an economic view point, it’s like watching a train wreck. But it’s also interesting to see The Renewable Fuels Association (RFA) come out against a low carbon standard. Obviously, folks like the American Trucking Associations (ATA) among others are strenuously against the cap and trade proposal.

Truckline

Should either of these programs come to fruition, I wonder how refining, retail, and transportation businesses will cope with a widely divergent set of rules, regulations and standards applied to just one state. I realize California has been consistently more aggressive on fuel standards and environmental compliance than other states, but these recent measures seem to take it to another level. What are your thoughts?

Again, I’d be remiss if I didn’t tie the actions in California back to the basic debate over global warming. A recent analysis published in the journal Geophysical Research Letters shows that Earth's ability to absorb carbon dioxide from all sources, including man, has remained unchanged for 160 years, and they assert that models used to predict future warming over-estimate airborne CO2 by as much as 82%.

Geophysical Research Letters

The CO2 Lie

Doesn’t exactly make me want to jump on the “let’s risk further destabilizing the economy to reduce CO2 emissions” bandwagon.

In other news, Tom Kloza from OPIS is predicting a very volatile year for gasoline and diesel prices which we always believe is a positive for FuelQuest customers.

OPIS Blog - 2010 Brings New Round of Highest Since References

As always, feedback welcome!

Cheers, Matt