Otis Matthews pumps gas into his car at the Valero gas station on Riverside Drive and Montopolis Drive on Monday, May 16, 2022. Average gasoline prices have jumped above $4 a gallon in Austin for the first time as fuel costs reach record highs in Texas and nationwide. Gas Prices Mlc 0014
Sacramento, California – California drivers are set to face higher gas prices beginning July 1, as a combination of new climate regulations and a fuel tax hike go into effect. The anticipated increases, which some analysts estimate could add as much as 65 cents per gallon, arrive at a time when fuel affordability remains a persistent concern for many working families across the state.
Updates to the state’s Low Carbon Fuel Standard is the primary driver behind the coming rise in price, approved by the California Air Resources Board (CARB) last fall. The changes increase penalties on refineries that produce high-carbon gasoline and diesel—costs that are likely to be passed along to consumers. Simultaneously, California’s excise tax on gasoline will tick up by two cents, bringing the total to 61.2 cents per gallon.
A last-ditch attempt to stall the expected increase failed in the state Senate on Wednesday. Senate Bill 2, sponsored by Republican State Senator Brian Jones of San Diego, sought to reverse CARB’s changes. The bill was defeated in a 10-23 floor vote, with every Democrat voting no. Jones framed the legislation as a necessary intervention for California families struggling under the weight of inflation and high energy costs.
Democratic lawmakers, led by Senate Majority Leader Lena Gonzalez, defended the climate rules as essential to California’s long-term environmental strategy. The revised fuel standard is part of the state’s broader effort to cut greenhouse gas emissions and accelerate the transition to cleaner alternatives. Critics of SB 2 argued that repealing the standard would jeopardize climate progress without addressing systemic affordability issues in a meaningful way.
Still, the political rhetoric reflects a broader tension in California policy: striking a balance between ambitious climate goals and the economic realities faced by residents. Gasoline prices in the state already rank among the highest in the nation. For many drivers, especially those in rural or working-class communities with limited access to electric vehicles or public transit, fuel remains an unavoidable expense.
CARB has stated it will monitor for unintended consequences, including any unusual market disruptions. But as the July deadline approaches, many Californians are left bracing for yet another squeeze at the pump, in a state already defined by its cost of living and ambitious environmental aspirations.
