Click play to listen to this article.

A new report criticizes California’s signature climate programs for enriching oil companies and biofuel suppliers by almost $28 billion from 2013 to 2024.

The report from The Climate Center and Community Energy ReSource finds that oil refiners and drillers were able to sell more than $8.6 billion in pollution credits through the Cap-and-Trade program, now renamed Cap-and-Invest.

Report co-author Woody Hastings, director of the Phase Out Polluting Fuels Program at the Climate Center, said the credits are basically permits to pollute and should be zeroed out.

Image

"This is served to lock in, to help prolong the fossil fuel era, the combustion fuel era," he said. "We really see this coming down to a decision about combustion versus electrification.

The data show that the state gave credits worth more than $19 billion to biofuel suppliers through the Low Carbon Fuel Standard program. Companies say they use the profits for processes to lower their emissions. Quarterly auctions of carbon emission allowances send billions to the Greenhouse Gas Reduction Fund to cover climate mitigation projects.

The state Legislature recently extended Cap-and-Invest until 2045.

Report co-author Greg Karras, principal at Community Energy ReSource, said both programs are a roadblock on the path to a zero-emissions future.

"The programs’ financial incentives are completely backwards," he said. "Rather than incentivizing the non-combustion alternatives necessary to solve the climate crisis, they're subsidizing internal combustion engines, oil companies, and the agricultural companies that are selling combustion biofuels."

The authors also called on policymakers to repeal part of Assembly Bill 398 from 2017, which prohibits local air districts from directly regulating carbon emissions. And they say they’d like to see big state investments to extend electric-vehicle charging networks, electrify public transportation, and help retrain oil and gas workers during the clean-energy transition.