Washington’s new cap-and-trade program may be hitting farmers’ wallets even though the law is supposed to shield agriculture from higher fuel costs.

The Washington Farm Bureau said Jan. 25 that farmers are unknowingly paying cap-and-trade surcharges levied on fuel producers and passed down the distribution chain.

Cap-and-trade imposes a fee on most fossil fuels, but exempts fuel used by the agricultural, maritime and aviation industries.

Farm lobbyists said they are pressing the state Department of Ecology to ensure surcharges won’t be levied on exempt fuels.

The surcharges could add up to 41 cents a gallon, they said. That is based on the estimated cost refineries will pay to comply with cap-and-trade. Exact figures are unclear.

“All we know is we’re left holding the bag and that should not have been the case,” Farm Bureau lobbyist Breanne Elsey said. “We are stressing it’s urgent and needs an immediate fix.”

Ecology director Laura Watson said in an email to lobbyists her department shared their concerns that cap-and-trade surcharges are being charged on fuel delivered to farms.

Ecology issued guidance Wednesday stating that oil refineries are responsible for making sure cap-and-trade surcharges aren’t applied to farm and other exempt fuels.

Ecology told lobbyists that it hoped the guidance will stop suppliers from assessing the surcharges, but noted that Ecology has no role in regulating how prices are set.

Western States Petroleum Association spokesman Kevin Slagle said fuel from refineries can pass though several distributors before reaching the consumer.

He compared tracking a fuel’s destination to “trying to track where a single apple ends up.”

Cap-and-trade went into effect Jan. 1, putting a fee on every ton of carbon emissions from most fossil fuels. The fee is expected to increase the cost of on-road gasoline and diesel.

Although the fee applies to emissions since New Year’s Day, it’s unknown what the fee will be. It will be determined by quarterly auctions. The first auction is Feb. 28.

The state anticipates the auctions will raise more than $1.7 billion over the first two years for government programs related to cutting greenhouse gas emissions.

Fuel used to transport farm goods on public highways is also supposed to be exempt from cap-and-trade surcharges for five years.

Ecology is developing a form that fuel suppliers can use to report and certify that fuel was used to transport agricultural products, according to the department’s guidance Wednesday.

Washington gas prices increased by 21.3 cents a gallon in the past month, AAA reported Wednesday. Gas prices increased nationally by 37.9 cents. Mild winter driving conditions increased the demand for gasoline, according to AAA.

Washington diesel prices increased by 2 cents a gallon, the 19th largest increase among the 50 states.