Kamala Harris

Attorney General
California Department of Justice
P.O. Box 944255
Sacramento, CA 94244-2550


Dear Attorney General Harris,

We are writing on behalf of millions of Californians to express strong concerns about the
potential manipulation of gasoline prices by oil companies, as transportation fuels come
under the greenhouse gas emissions cap created by AB 32, the Global Warming
Solutions Act of 2006.

On January 1
st
, 2015, AB 32which was overwhelmingly reaffirmed by California voters
in 2010 with the defeat of Prop 23will begin to cap emissions from transportation
fuels, which is the largest source of pollution in our state and 40 percent of total
greenhouse gas emissions.

For far too long, low-income communities in California have borne the impact of some of
the worst air quality in the countrya result of a massive transportation system
dependent on polluting fossil fuels. In an effort to address this public health crisis and
support a more sustainable economy, California is championing programs and policies
that are both cleaning up and diversifying our fuel mix. Unfortunately, the fuels market in
California continues to be dominated by a handful of producers who seek to undermine
these critical policies through a massive misinformation campaign.

The oil industry is currently spending millions of dollars on a lobbying and public
relations campaign designed to roll back the law. A cornerstone of their campaign is an
implicit and in some cases explicit threat that the oil industry will increase gasoline
prices for California consumers if it is forced to comply with AB 32.

The California Air Resources Board, the administrating agency for AB 32, in a recent
letter stated that:

The nature and design of the Cap-and-Trade program provides that any cost
from bringing fuels under the cap will occur over time. In fact, unless there were
to be unlawful collusion on the part of the industry, any price impacts should vary
among oil companies, reflecting their difference in compliance costs.

The Attorney Generals office has the important responsibility and opportunity to protect
California consumers from anticompetitive industry practices. Past experience and
analysis shows that the primary catalysts for change in gas prices are: volatility in global
oil markets, refinery operations, inventory levels, refined product exports and seasonal
demand. Oil companies have already taken steps to comply with AB 32many
companies have already made investments in anticipation of the law, and the oil
industry has already begun investing in compliance instruments.

This Big Oil campaign is nothing more than a transparent attempt to misdirect the public
and blame uncertain future price fluctuations on the Governor, the Legislature and state
regulators in hopes of distracting consumers from their attempt to get a free ride while
raking in record profits. Strategic price manipulation in the fuels market serves to
perpetuate Californias dependence on fossil fuels, resulting in poor air quality and
volatile prices, at the expense of Californians health and wallets.

Your office has been a leader in efforts to protect consumers, and we trust that you will
take these issues seriously. We look forward to supporting your efforts to closely
monitor the situation and ensure oil companies in California arent unlawfully colluding
to manipulate prices and manufacturing political dissent.

The benefits of AB 32 are vast. Environmental benefits include reducing greenhouse
gases to levels that are equivalent to removing 15 million cars from the road. On the
business front, Californias growing economy is already benefiting significantly from AB
32, with new clean energy technologies emerging up and down the state. And at the
consumer level, AB 32 will save the average household nearly $400 in annual fuel
expenditures while also directing needed investments to disadvantaged communities.
Together, the positive environmental and economic benefits of AB 32 are meaningful for
all of Californias families.

We strongly support Californias clean air and energy leadership and the underlying
goals of AB 32. We appreciate your efforts to ensure that consumers are protected from
price manipulation at the pump.

Sincerely,

Josh Fryday, NextGen Climate
Timothy OConnor, Environmental Defense Fund
Jon Youngdahl, SEIU California
Strela Cervas, California Environmental Justice Alliance
Jamie Court, Consumer Watchdog
Sarah Rose, California League of Conservation Voters
Miya Yoshitani, Asian Pacific Environmental Network
Michael Lighty, National Nurses United
Diane Takvorian, Environmental Health & Justice Campaign
Byron Guidel, Communities for a Better Environment
Paul Song, Courage Campaign
Penny Newman, Center for Community Action and Environmental Justice