Calif. Study Says Carbon Cuts Could Lower Fuel Costs

California Gov. Arnold Schwarzenegger (R) released a study Friday showing that the state can cut fuel prices and stimulate its economy by reducing carbon content in transportation fuels, the Associated Press reported.

Schwarzenegger in January signed an executive order mandating that California refineries reduce the carbon content of passenger vehicle fuels by 10% by 2020, a critical component in the state’s effort to reach its target of cutting greenhouse gas emissions by 25%, AP said.

The University of California study attempts to solve the issue by creating a complex way to measure total greenhouse gas emissions created during fuel production, AP reported.

The study concludes that an emissions credit system, under which overachieving refineries can sell credits to those failing to meet the standard, could stimulate enough competition and investment in alternative fuels that the state could more than achieve its 10% reduction goal by 2020, AP said.

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