American Trucking Associations First Vice Chair Barbara Windsor took issues with the cap-and-trade proposal to the Senate Environment and Public Works Committee today, claiming the legislation would increase the price and volatility of diesel for the trucking industry.
"ATA strongly supports efforts to reduce greenhouse gas emissions and make this country more energy independent," said Windsor, who is president and CEO of Hahn Transportation in New Market, Md. "However, an economy-wide cap and trade system is not the answer."
While supporters of the initiative believe the fuel price increase will cut consumption, Windsor said it will not reduce trucking's carbon emissions because trucking is not a discretionary user of fuel.
"In our industry, a higher fuel price does not translate into fewer miles traveled because the nation depends on trucks to deliver nearly 100 percent of the food, clothes, and medicines that we use in our daily lives," said Windsor. "Instead, this increase in diesel prices will raise logistics costs within the economy and hurt the American consumer."
Under cap-and-trade, oil refineries would purchase emission allowances that cover their direct refining operations and the amount of carbon produced by downstream combustion of the produced fuels.
"The costs associated with obtaining these allowances will be passed on the fuel consumers in the form of higher prices," said Windsor. "A major petroleum supplier to the trucking industry has advised that diesel fuel costs could rise by up to 88 cents."
"Should Congress move forward with a cap-and-trade carbon control system, oil refinery carbon caps should apply only to the refinery's direct carbon emissions and not to the downstream combustion of the products they produce such as gasoline, diesel, and jet fuel," said Windsor.
The legislation would also cause price volatility as carbon prices fluctuate, making it difficult for trucking companies to predict expenses.
In a statement, ATA expressed its concern with support from various investment banks for cap-and-trade, who would stand to profit from volatility in the energy futures markets and a carbon derivatives market.
To read Truckinginfo.com's previous coverage, click here.
"ATA strongly supports efforts to reduce greenhouse gas emissions and make this country more energy independent," said Windsor, who is president and CEO of Hahn Transportation in New Market, Md. "However, an economy-wide cap and trade system is not the answer."
While supporters of the initiative believe the fuel price increase will cut consumption, Windsor said it will not reduce trucking's carbon emissions because trucking is not a discretionary user of fuel.
"In our industry, a higher fuel price does not translate into fewer miles traveled because the nation depends on trucks to deliver nearly 100 percent of the food, clothes, and medicines that we use in our daily lives," said Windsor. "Instead, this increase in diesel prices will raise logistics costs within the economy and hurt the American consumer."
Under cap-and-trade, oil refineries would purchase emission allowances that cover their direct refining operations and the amount of carbon produced by downstream combustion of the produced fuels.
"The costs associated with obtaining these allowances will be passed on the fuel consumers in the form of higher prices," said Windsor. "A major petroleum supplier to the trucking industry has advised that diesel fuel costs could rise by up to 88 cents."
"Should Congress move forward with a cap-and-trade carbon control system, oil refinery carbon caps should apply only to the refinery's direct carbon emissions and not to the downstream combustion of the products they produce such as gasoline, diesel, and jet fuel," said Windsor.
The legislation would also cause price volatility as carbon prices fluctuate, making it difficult for trucking companies to predict expenses.
In a statement, ATA expressed its concern with support from various investment banks for cap-and-trade, who would stand to profit from volatility in the energy futures markets and a carbon derivatives market.
To read Truckinginfo.com's previous coverage, click here.
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