Gas prices could rise after vote by California regulators

California air quality regulators late Friday approved tougher rules to encourage use of lower-carbon fuels, overriding objections that the action would lead to higher gasoline prices for motorists.

On a 12-to-2 vote, the California Air Resources Board approved amendments to the state’s Low Carbon Fuel Standard, or LCFS, which aims to shift California’s fuel dependence away from gasoline and toward lower-carbon fuels such as biodiesel, hydrogen and electricity.

The board members voting for the program, some looking bleary-eyed by the end of the 12-hour meeting, said the new rules were needed to move the state closer to its goal of no longer burning fossil fuels.

“From a climate perspective, this is absolutely necessary,” said board member Hector De La Torre.

Dean Florez, a former Democratic state lawmaker, was one of two board members to vote no. He said one of his concerns was that the plan would make driving more expensive in a state that already has the second-highest pump prices in the nation after Hawaii.

“I’m just kind of wondering how we can in all good conscience say that … somehow we’re not a cause of this,” Florez said.

Of the 14 voting members on CARB’s board, 12 were appointed by Gov. Gavin Newsom and confirmed by the state Senate. Florez was appointed by the state Senate. De La Torre was appointed by the state Assembly.

California Air Resources Board staffers estimated last year that the new rules could raise the price of a gallon of gas by as much as 47 cents next year. By 2040, the added cost to the price per gallon could be $1.80, staff members estimated in their 2023 document.

Since then, and again Friday, CARB officials asserted that those estimates were flawed and that they no longer believe the action will boost gas prices.

“Any claims that LCFS is responsible for high gas prices is misleading at best and not supported by the data,” Dillon Miner, CARB’s staff air pollution specialist, told the packed auditorium in Riverside on Friday.

Those assurances were met with skepticism by some speakers during the seven-hour public hearing.

Assemblymember Tom Lackey (R-Palmdale) told the board that residents of his district, many of whom were lower-income, often drove 100 miles a day.

“This is all about survival, financial survival,” Lackey said. “We simply cannot afford this.”

Nearly 13,000 Californians signed a petition written by Republican state senators that asked the board to postpone the vote until CARB provided information on how much the amendments would increase gas prices.

Even some Democrats spoke out about how the amendments could raise gas prices, which would especially burden low-income people who must drive to their jobs.

“I represent a working-class rural district that is largely dependent on agricultural jobs,” Assemblymember Esmeralda Soria (D-Fresno) wrote in a Thursday letter to CARB Chair Liane Randolph. “It is these working families that can least afford even a modest increase in fuel prices.”

Many speakers at the public hearing urged the board to reject the amendments for reasons that did not involve the price of gasoline.

Some said they lived in the Inland Empire where the meeting was held. They spoke about how the pollution from trucks and other vehicles was continuing to harm the health of their families. They said they believed the program was benefiting companies by allowing them to continue to pollute and that the board should do more to support electric vehicles.

Environmentalists told the board they were disappointed that the amendments favored fuels such as renewable diesel that is made from food crops including soybeans and canola. Such biofuels result in turning land that was once used to grow food into that producing fuel.

Gary Hughes at Biofuelwatch told the board that the plan would be “a driver of global deforestation” as more land was used to grow plants for the biofuel. “These fuels are not a climate solution,” he said.

Because of the LCFS, California now accounts for nearly all renewable diesel consumption in the U.S. Most of that fuel is not made in California but trucked in from other states or imported, mostly from Singapore.

“These dirty fuels are wolves in sheep’s clothing,” Nina Robertson of Earthjustice told the board.

Supporters of the amendments included dozens of executives from the producers of alternative fuels and electric vehicles, as well as other companies that have been financially benefiting from the program.

Steve Lesher of Shell USA told the board that the LCFS had prompted the oil company to invest in hydrogen and biofuel production, as well as electric vehicle charging stations. He called the program an “investment attractor.”

The LCFS program was created in 2009 under Republican Gov. Arnold Schwarzenegger. CARB says the program has resulted in more than 30 billion gallons of petroleum being displaced by low-carbon fuels. The program, the agency said, also has helped California reduce its greenhouse gas emissions by 20%.

The state uses a carbon-trading market to encourage producers to make the alternative fuels. Producers that don’t meet the state’s low carbon standard must buy credits from those that do, which pushes companies to develop cleaner options.

Under the current program, fuel producers had to reduce the carbon intensity of their fuels by 20% of the levels in 2010 by 2030.

The proposal approved Friday increased the carbon-intensity reduction target in 2030 to 30%. And the target would leap to 90% in 2045.

As the standard tightens, the cost of the credits is expected to rise. Critics say this cost will be passed on to consumers.

CARB officials say that isn’t correct. They say there is no direct relationship between the fuel credit prices and the cost of gas at the pump. And they say data show that the current fuel standard, before the amendments approved Friday, has added just 10 cents to the price of a gallon of gas.

Danny Cullenward, a climate economist in San Francisco and senior fellow at the Kleinman Center for Energy Policy at the University of Pennsylvania, estimated in an October report that under the new rules, the 2025 cost could be as high as 65 cents a gallon.

“It’s absolutely irresponsible and unacceptable that this board has chosen to ignore how its policies will impact gas prices,” state Sen. Rosilicie Ochoa Bogh (R-Yucaipa) said in a statement. “How can they possibly vote to approve it if they don’t even know what it will do to Californians at the pump?”