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gasprices.JPGSenate leader Darrell Steinberg is expected to introduce a controversial proposal today to place a new tax on drivers buying gas at the pump and divert the money to transit projects and tax credits for low- and middle-income Californians.

The proposal would remove an upcoming requirement that oil companies buy carbon credits for the fuels that they sell to consumers, while leaving in place the requirement that they enter the cap-and-trade market for pollution they produce at their refineries. That would be a change to California's landmark greenhouse gas reduction law known as Assembly Bill 32, written by Sen. Fran Pavley.

"This proposal will say, 'OK fuel sector, you don't have to... reduce your greenhouse gas emissions anymore,'" Pavley said.

"It pokes a big hole in the whole policy of AB 32, of treating all the major polluters equally."

Steinberg declined to talk about details of his proposal before his noon appearance at the Sacramento Press Club. This morning, he said only that he would be making an announcement concerning "climate change and poverty," and that he expected his proposal to spark a vigorous debate inside the Capitol.

Editor's note: This post was updated at 3:12 p.m. to clarify the impact of the proposal on oil companies.


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