New Survey: Consumers Expect Backlash from Cap & Trade for Fuels

EMC letterhead

 July 16, 2014

MEMORANDUM

From:     EMC Research

Re:         Public attitudes about expansion of cap and trade program to fuels

EMC Research is pleased to provide the following summary and key findings of recent public opinion we conducted for Western States Petroleum Association on the subject of expanding California’s cap and trade program to include gasoline and diesel beginning January 1, 2015.

This research was conducted as a telephone survey of 1,001 likely California voters between April 23 and May 6, 2014.  The results have a margin of error of plus or minus 3.1 percentage points.

Among the key findings:

  • An overwhelming majority of California voters – 68 percent – are unaware that gasoline and diesel fuel are set to be regulated under California’s cap and trade program beginning January 1 of next year.
  • Fifty-nine percent of those surveyed said they opposed the program.
  • Sixty-three percent of California voters support canceling or delaying the program.
  • 88 percent of potential voters said consumers would be very angry if they see higher fuel costs as a result of the cap and trade program.

Under regulations adopted by the California Air Resources Board (CARB), the cap and trade program that now regulates emissions from stationary sources such as cement plants, electric power generating facilities and oil refineries will be expanded to include gasoline and diesel on January 1, 2015.  Refiners will be obligated to purchase emission allowances for every gallon of gasoline and diesel sold in California, a requirement that will add billions of dollars to the cost of supplying fuel to consumers.

Opinion Environment

Over the course the past 17 years, EMC Research has tracked voter sentiment on the general direction that California is going.  While Californians are feeling better about the direction the state is going than they did in May of 2010, half of the voters we surveyed said they believe the state was going in the wrong direction.

Q: Do you feel that things in California are generally going in the right direction or do you feel things have gotten pretty seriously off on the wrong track?

Right direction-Wrong track chart

 

Cap and Trade Program Awareness

As mentioned above, a very large majority of California voters are unaware the cap and trade program is going to be expanded to include transportation fuels.

Q:  Have you seen, read, or heard anything about a cap and trade for fuels program in California?

 Cap and Trade Prog Awareness

Initial Support/Opposition

After being read a short description of the potential benefit and costs of the program, we found strong opposition to a cap and trade program expansion to transportation fuels.

Q: As you may know, California has adopted a cap and trade program in an effort to reduce greenhouse gas emissions and fight global warming. On January 1st, the cap and trade program will be expanded to include gasoline and diesel fuel. Experts estimate that the program may reduce emissions, and could also lead to an increase in the cost of gasoline, from as little as 12 cents per gallon to as much as 70 cents per gallon, or more.  Based on what you’ve heard, would you say you favor or oppose expanding the cap and trade program to include gasoline and diesel?

Based on what you’ve heard, would you say you favor or oppose expanding the cap and trade program to include gasoline and diesel?

FUTC favor-oppose

When probed further, a majority of respondents said they would like to the see the program either delayed or canceled entirely.  Only 28 percent said they believed the program should be implemented as planned.

Q:  Which of the following is closer to your opinion: The cap and trade for fuels program should be…

FUTC Planned or Delay

The lack of awareness of the expansion of the cap and trade program caused many respondents to predict a consumer backlash to the program.

Q: Please tell me if you strongly agree, somewhat agree, somewhat disagree or strongly disagree with each of the following statements.

Agree-Disagree statements

Arguments in Support of Cap and Trade for Fuels

We tested a number of arguments that support expanding the cap and trade program to fuels to measure if those arguments changed initial attitudes.

Q:  Please rate each one, using a 1 to 7 scale, 1 meaning the statement is Not Convincing at All and 7 the statement is Very Convincing as a reason to support cap and trade for fuels.

Cap and trade support statements

After hearing the messages in support of the program, the number of respondents who said they would support the program increased but still remained a minority.

Q: Based on what you’ve heard so far, do you favor or oppose expanding the cap and trade program to include gasoline and diesel?

Pre Post Support Messages

After hearing arguments in favor of the program, a strong majority still favor either delaying or canceling the program entirely.

Q: Which of the following is closer to your opinion: The cap and trade for fuels program should be…

Cap and trade delay after support messages

Arguments Against Cap and Trade for Fuels

We then provided survey participants a series of arguments against expansion of the cap and trade program to fuels.

Q: Please rate each one, using a 1 to 7 scale, where 1 means the statement is Not Convincing at All and 7 means the statement is Very Convincing as a reason to oppose cap and trade for fuels.

FUTC oppose messages

After hearing opposition arguments, the level of opposition to the program returned to initial level before participants heard arguments for and against the program.

Q: Now, based on all you’ve heard, do you favor or oppose expanding the cap and trade program to include gasoline and diesel?

FUTC after all messages

A strong majority of respondents remained opposed to implementing the cap and trade program for fuels after hearing arguments for and against the program.

Q:  And one last time, which of the following is closer to your opinion: The cap and trade for fuels program should be…

Cap and trade delay after all messages

Conclusions

  • Awareness of the program is very low.
  • A majority of California voters oppose the cap and trade for fuels program.
  • Most voters also think it should either be delayed or canceled entirely.

Voters are overwhelmingly concerned about the potential costs associated with California’s Fuels under the Cap program.