A great shock awaits American drivers.
The price of gas on Jan. 18, two days before Joe Biden took the oath of office, was $2.46 nationally, according to the Energy Information Administration.
On May 24, it was $3.11.
Even though the Colonial Pipeline shutdown had its influence on it, data reveals that the increasing trend had started well before that.
Nevertheless, the high price was a shock, especially before the Memorial Day weekend, as it’s the highest per-gallon prices America has seen since the Obama administration.
However, a member of The Wall Street Journal’s editorial board claims that these are times we will miss soon!
She claims that you’re going to be seeing the same policies that caused those gas prices exported to the rest of the United States.
In a Friday opinion piece, Allysia Finley maintains that energy costs have long been skewed upward in the Golden State. She wrote:
“Before the Colonial Pipeline shutdown, the national average gasoline price had exceeded $3 a gallon for only two weeks since 2014. Yet in California, gas prices in recent years have rarely dropped below $3.
They now average $4.18 a gallon — $1.14 more than the national average — and in recent months have increased more than prices nationwide. Why do California drivers pay so much at the pump? Blame a higher-octane blend of taxes and environmental regulations.”
She listed the taxes first, noting that California has long had a higher gas tax than the national average.
However, back in 2017, the legislature passed a bill that increased the gas tax by 12 cents initially and 20.8 cents later. That money was intended to fund infrastructure repair, but nothing really happened.
Pretty familiar, isn’t it?
While the gas tax will jump again on June 1, only half the work promised has been finished.
State Assembly Speaker Anthony Rendon said:
“The reality is that infrastructure repair was underfunded for decades and that neglect had no instant solution. If we agree that we want improvements for our transportation system, we have to pay for them, and the gas tax made the most sense as the way to do that.”
Now, California drivers pay 50.5 cents per gallon in taxes, and these taxes will increase to 51.1 cents on June 1.
Finley wrote that when local taxes are accounted for, taxes take up a whopping 63 cents of every gallon for the average Californian, while other Americans pay 36.8 cents per gallon.
What’s more, this is not all.
According to Finley:
“The California Air Resources Board, or CARB, also imposes a de facto carbon tax through its cap-and-trade program. Since 2013, refiners, oil producers, and manufacturers have been required to reduce emissions or buy credits to offset them. The program adds about 14.3 cents a gallon to the retail price.
CARB also requires gasoline retailers to sell a special extra-clean-burning gasoline blend, which adds another 10 cents a gallon to the price, according to University of California, Berkeley professor Severin Borenstein. In addition, CARB in 2011 implemented a low-carbon fuel standard, which requires refiners to reduce the ‘carbon intensity’ — meaning total emissions from production, transportation, refining, and combustion — of the gasoline they blend, expressed as a ratio of mass emitted to energy produced.”
This extra-clean-burning combination leads to other problems in California, as refineries there are making a switch to renewable fuels — more profitable — and out-of-state refineries aren’t set up to refine the specific CARB blend.
This means that any refinery outage leads to an increase of 50 or 60 cents in the state.
Moreover, CARB also subsidizes electric cars.
If a person in California charges his electric car at home, he will be given a $1,500 credit from his utility provider, on top of the $2,000 California provides for buying an electric car and the $7,500 the federal government doles out for buying an EV.
“Yet drivers of gasoline-powered cars are subsidizing the utility rebates through higher fuel prices. As the state’s carbon-intensity benchmark has fallen, prices for regulatory credit prices have soared — from $17 on average in 2012 to $198 in the first quarter of this year. An analysis last fall by Stillwater Associates estimated that the program would add 24 cents a gallon to the price of gasoline this year and 63 cents by 2030.”
According to her, “Californian drivers can soon look forward to paying more than $5 a gallon at the pump as the state’s green mandates ratchet up and gasoline refineries shut down or convert to renewable fuels.”
Finley also notes that “[p]rogressives are clamoring for the Environmental Protection Agency to emulate California’s low-carbon fuel standard as a way to subsidize electric vehicles.”
In the end, she concludes:
“So enjoy your $3 gasoline. It may not last long.”
While the rest of the nation regarded the Californian policy on gas and emissions as unthinkable, President Joe Biden has now set a ludicrous goal of reducing our carbon emissions by half by 2030.
At the same time, he’s pushing a sweeping $2.3 trillion infrastructure bill that’s heavy on promoting electric vehicles and EV infrastructure.
His agenda resembles the one of Senate Majority Leader Chuck Schumer, the proposed 2019 cash-for-clunkers EV legislation, which would set aside a whopping $392 billion to get people to turn in their gas-powered cars to switch to electric vehicles.
Dems regard gas as any other vice product, such as cigarettes and alcohol, as they can easily sell a tax on it.
Now, the Republicans are attempting to sell the president a hike in the federal gas tax as a way to compromise on the infrastructure bill.
Currently, Biden is against it, probably as a result of the criticism he faces over the current gas price.
Yet, it would be a huge mistake to believe that any effort to get America to switch to EVs while trying to execute an overambitious infrastructure bill and reduce carbon emissions by half in less than ten years won’t include dramatic gas taxes.
California is an example of it.
It would be wise, now with the Dems in control of the White House, to expect a lot of California’s ideas to be exported nationwide.
Time will tell, but let’s admit that, only a year ago, this wouldn’t have even been a question.