Wednesday, February 3, 2016

Why California gasoline is so expensive

So, the author tries to determine the "evil" profit and who is to blame for the high price.  The answer?

They only have themselves to blame.

We begin with taxes. California’s combined state and federal taxes add 59 cents to each gallon of gas at the pump. That’s 11 cents above the U.S. average, reports the American Petroleum Institute.

Subtracting 11 cents in higher taxes from our 73-cent gouge gap leaves 62 cents of unexplained cost.

California has tacked on about 12 cents in fees for its “cap and trade” market and low-carbon fuels standard. This gets us to 50 cents.

State regulators also mandate a pollution-reducing blend that costs more to produce, although how much varies by refiner. When you compare the U.S. average for reformulated gas to California’s, the unexplained gap narrows further by 20 cents. Notably, the public overwhelmingly supports such environmental costs.

To review, taxes and environmental mandates directly account for 43 cents per gallon of the 73-cent cost we paid Monday above the U.S. average, leaving us with 30 cents to go.

Market forces — meaning profits for somebody — generally explain this 30 cents per gallon. If you guessed that regulators play a role here, too, go to the head of the class.

So, the crux of the story,without being a jerk about it, is "just live with it and shut up, because this is what CA wants."

Yeah.  Whatever.


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