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DRIVERS in one US state will need to make an extra $1,000 to afford gas prices next year, an expert has warned.
The surge in prices is set to be triggered by a move requiring gas stations to carry a more expensive blend fuel.
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From next year, gas stations in California will have to carry the new, cleaner fuel, approved by the state’s Air Resources Board (CARB).
This change could see gas prices surge by up to $0.65 a gallon next year, and up to $0.85 by 2030, according to a study from the University of Pennsylvania.
A different study from Professor Michael A. Mische of the USC’s Marshall School of Business, warns gas prices will go up by a slightly-lower $0.47 a gallon.
Mische predicts these rises will require Golden State drivers to pay an extra $222 to $449 a year for regular fuel, and more for premium.
Drivers relying on fueling their vehicles with gas will have to make an extra $600 or even $1,000 in pre-tax income just to break even in 2025, he said, as reported by Los Angeles-based Fox affiliate, Fox11.
“The increase contributes to inflation, the high cost of living in California, and has a disproportionate and adverse impact on lower-income Californians,” Mische wrote.
This comes after the CARB updated its low carbon fuel standard as part of California’s efforts to increase access to cleaner fuels.
California already has the highest average gas prices in the US, according to the World Population Review.
Regular gasoline is priced at $4.96 per gallon, due in part to higher taxes and stricter environmental regulations.
Prices in the state are tied to the state’s price index.
The move could drive retail gasoline prices in California to more than 60% above the national average by the end of next year.
Mische also blamed the decision to close a Los Angeles refinery this year in the face of environmental targets for contributing to surging gas prices.
“Policy has consequences,” he warned in his report.
Electric vehicles vs gas
Pros and cons of EVs vs gasoline-powered vehicles
EV PROS:
- Convenient (when charging at home)
- Cheaper (depending on state or city)
- Cheaper maintenance, due to lack of mechanical parts
- Great for commuting
- Reduced CO2 emissions
- Federal and state tax incentives
- More performance (speed, handling – depending on the make and model)
EV CONS:
- Higher initial cost
- Higher insurance rates
- More frequent tire and brake replacement intervals
- Higher curb weight (thus causing more rapid wear on crucial parts)
- Low resale value
- High depreciation rates
- Lack of charging infrastructure
- Unreliable public charging (related: slow charging times)
- Poor winter and summer performance
- Lack of clean energy alternatives means more “dirty energy” from coal and nuclear sources
- Range anxiety
GAS PROS:
- Highly developed refueling infrastructure
- Fast refueling
- Cheaper insurance rates, depending on make, model, and configuration
- Established repair industry
- Lower initial cost
- Higher range before refueling, especially with hybrids
- Many manufacturers produce nearly emission-less engines
- Cheaper refueling, depending on the location
GAS CONS:
- Finite resource (related: heavy dependence on petroleum)
- Carbon emissions/greenhouse gases
- Higher repair costs
- Higher insurance rates, depending on make, model, and configuration
- Varying costs at the pump, depending on state, city, and county
Source: Car & Driver, Perch Energy, AutoWeek
In October, Governor Gavin Newsom signed a new law to help tackle soaring gas prices.
President-elect Donald Trump has pledged to stop individual states from setting their own rules on emissions.
He has also vowed to stop states from banning gasoline-powered cars.
California plans to phase out traditional vehicles in favor of EVs by 2035.
Republicans have slammed Democratic Governor Newsom after it was revealed he has moved away from the state capital Sacramento, and will now be chauffeured to work in a gasoline car.
“Newsom is completely out of touch, recently purchasing a $9.1 million mansion in Kentfield, a wealthy town that’s 90 miles away from his job in Sacramento,” Senate Minority Leader Brian W. Jones, said in a statement.
“While regular Californians face tough choices between putting food on the table or gas in their cars, Newsom will be chauffeured to work from his luxury home in a taxpayer-funded car, running on taxpayer-funded gas, on the rare occasions he decides to show up.”
California is already one of the most expensive states to live in, with only 16% of residents able to afford a home, according to Fortune.
