OPINION: TCI: Will the Legislature mandate gas rationing in Connecticut?

By Len Suzio

Very few Connecticut citizens have heard of “TCI”, but they may very well feel its painful effects if the Legislature approves the controversial legislation proposed by Governor Ned Lamont. “TCI” or “Transportation Climate Initiative” sounds harmless, but it is poison. What TCI will do is to restrict and effectively ration the amount of motor fuel (gas and diesel) that can be sold in Connecticut.

The state would do this by establishing a cap for the amount of CO2 emissions related to fuel sold in the state, then forcing motor fuel purveyors to bid at auction for the right to sell their fuel. The limit established by the emissions cap would force up the price of gas and might result in some fuel suppliers not being able to sell any fuel to Connecticut motorists. Moreover, the limit on motor vehicle fuel sales will decrease every year for the next decade, shrinking the availability of gas and diesel fuel supplies available to Connecticut consumers.

Make no mistake, this is enforced motor fuel rationing implemented by fuel volume restrictions and higher fuel prices inflated by bids (effectively a tax) paid at auction to the government. Radical left-wing politicians love it because they can claim the higher gas prices paid for the right to sell fuel are technically not a tax. Call it a fee if you like, but there’s no getting around the fact it’s a government levy on motor fuel, and it will be passed on to consumers in the form of higher prices.

So how much will this cost motorists and how restricted will gasoline and diesel fuel supplies be in Connecticut under Governor Lamont’s TCI?

A Tufts University Study on the impact of TCI in Massachusetts indicates the impact of TCI in the first year could be as much as 38 cents per gallon, and 61 cents per gallon over the 10 years of the deal!

Anticipating the brouhaha that those price increases would precipitate, the Connecticut proponents of TCI propose a “cap” on gas price increases. Simple economics tells us that such a cap is bound to bring fuel shortages.

TCI advocates conceive of a “Cost Containment Reserve” and an “Emissions Containment Reserve” which would increase emission allowances if prices increase above a certain level. Conversely, if prices are lower than expected the emission allowances would be reduced, thereby further constricting the supply of motor fuels.

So, TCI packs a double wallop — an extra fee added to Connecticut’s current double gas tax (the excise tax and the Petroleum Gross Earnings Tax) and an artificially limited supply of motor fuels.

It’s the worst of all worlds for Connecticut consumers: pay an inflated price and wait in line (shades of 1973?) to buy gas from a rationed supply limited by Governor Lamont and the politicians at the Capitol.

Why would the governor and Legislature impose such a burden on Connecticut motorists? The ostensible reason is the debatable “threat” of Climate Change. But CO2 emissions are forecast to decrease by close to 20% even without TCI!

So, what’s the story? Follow the money. Another powerful incentive for politicians is the huge sums of money the scheme could generate for the state.

At least motorists might hope that the state would take the potential billions of dollars in new taxes and invest it in the state’s transportation system. But instead, the proposed legislation would spend as much as 35% of the fees collected to “ensure communities that are overburdened by air pollution or underserved by the transportation system . . . benefit from projects and policies that reduce emissions from transportation sources.” In other words, the Dems plan on diverting hundreds of millions of dollars to the cities.

With gas prices going up since the beginning of the year, the state already is reaping a windfall of gas tax collections because the Petroleum Gross Earnings Tax is calculated at 8.1% based on the wholesale price of fuel. The higher the price of gas, the more PGET tax collections increase.

So, what are the lessons here? First, there’s never enough taxes to satisfy the insatiable appetite of Connecticut government. Second, the politicians at the Capitol have not learned a thing from the destructive policies that have made Connecticut’s economic growth nearly dead last since 2008. Finally, TCI will be unnecessary government-induced gas-rationing that will make gas more expensive and harder to buy in Connecticut.

Len Suzio is a former state senator.


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