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California Eyes July 1 Fuel Rule Amid $8 Gas Forecast, Refinery Closures, and $1.47/gal Regulatory Costs

15 posts • GPT (4.1)

Published May 17, 2025, 02:00 AM

The California Air Resources Board (CARB) has submitted technical fixes to its updated Low Carbon Fuel Standard (LCFS) regulations and is seeking approval from the Office of Administrative Law (OAL) to implement the rules starting July 1, 2025. The OAL had previously blocked the regulations due to issues with clarity and procedural errors, requiring revisions to 26 sections of the more than 300-page rule.

The updated LCFS aims to reduce transportation emissions by 30%, but is expected to increase costs for oil refiners, with those costs likely to be passed on to consumers at the gas pump. Experts and CARB staff have acknowledged that these changes could significantly raise gasoline prices in California, where drivers already pay an estimated ten cents per gallon due to the existing LCFS. CARB has faced backlash over a lack of transparency regarding the impact of the new rules on gas prices.

California's gasoline prices are already among the highest in the United States, influenced by state taxes, fees, environmental mandates, and declining in-state fuel production. Regulatory costs and fees associated with programs such as cap-and-trade and the LCFS add around $1.47 per gallon to consumer prices, and Californians pay $0.90 per gallon in local, state, and federal gas taxes.

A University of Southern California report warns that the potential closure of two refineries—Phillips 66 in Los Angeles and Valero in Benicia—could push prices as high as $8 per gallon by 2026 and create a gasoline deficit of up to 13.1 million gallons per day. The report also notes that these developments could worsen the state's $73 billion budget deficit.

Despite the state's push for net-zero climate policies, Californians continue to consume approximately 13.1 million gallons of gasoline daily.

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Rob Pyers

@rpyers

CA's government continues finding innovative ways to increase the price of gas: • Low Carbon Fuel Standard regulations • Cap-and-trade reauthorization • Loss of 20% of state refinery capacity A Select Committee on Bad Luck is needed to find out why this keeps happening.

Gabriella Hoffman

@Gabby_Hoffman

CA could see $8/gal gas next year if two refineries shut down. Why are gas prices so high there? Blame taxes, fees & climate mandates. Sacramento might be going "net-zero" but residents consume 13.1M gal of gas daily. My deep dive at @IWF today

Ashley Zavala

@ZavalaA

California Air Resources Board hopes its controversial clean air rules can go into effect July 1. Those rules are expected to raise gas prices, and the board faced backlash last year because it wouldn’t be transparent with actual impacts at the pump.

Bloomberg Opinion

@opinion

California is losing fuel production faster than it is losing its appetite for gasoline. High prices have electoral consequences, say @liamdenning and @Erika_D_Smith

Sar Haribhakti

@sarthakgh

🔥🔥 “If housing scarcity is all about greed, why is it so much more expensive to build homes in CA than, say, FL or SC—are Florida developers really half as greedy as Californians? - If energy policy is mostly downstream of big oil lobbying, why has Texas added the most solar

#California Air Resources Board #CARB #Low Carbon Fuel Standard #Office of Administrative Law #OAL #California #United States #University of Southern California #Phillips 66 #Los Angeles #Valero #Benicia

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