■New rules under consideration by the California Air Resources Board could hike fuel prices by about 50 cents per gallon next year, according to a CARB report.

■Transportation sources are the greatest source of air pollution in California.

■Although transportation costs will be higher in the short term, CARB estimates they will drop by 40% over the long run with shift from carbon-based fuels to electricity and hydrogen.

California’s ongoing campaign to reduce greenhouse gas emissions and decarbonize the environment has the California Air Resources Board considering changes in how the state rewards low-carbon fuels and punishes high-carbon fuels that could hike fuel costs by about 50 cents per gallon starting next year.

Or maybe not.

A CARB impact assessment released in September 2023 on the potential impact of amendments to the state’s Low Carbon Fuel Standard, or LCFS, had predicted that gasoline could jump by 47 cents per gallon, diesel by 59 cents, and “fossil” jet fuel by 44 cents.

From 2031 through 2046, the proposed amendments might boost the price of gasoline by $1.15 per gallon, diesel by $1.50 per gallon, and fossil jet fuel by $1.21 per gallon on average, according to the CARB forecast.

However, a CARB spokesman told GV Wire that fuel costs are affected by many factors and that the report’s estimates were based on a conservative scenario.

Measuring ‘Carbon Intensity’

The amendments under consideration would include tightening “carbon intensity” reduction targets through 2030 and extending the targets through 2045; eliminating the intrastate exemption from the low carbon standard for fossil jet fuel; and providing incentives to expand fuel production and refueling infrastructure for zero-emission vehicles.

“Carbon intensity” is a measurement of carbon dioxide emitted during activities. Driving a gas- or diesel-powered vehicle is more carbon-intensive than driving an electric-powered car, for example.

Producers of higher-carbon fuel are required by the state’s Low Carbon Fuel Standard to buy credits from companies that sell cleaner fuels, and the cost of those credits is added to what consumers pay at the pump. So, as the cost of the credits increases, the cost of fuel does, too.

Evaluating Public Comments

CARB originally had scheduled a public hearing and vote on the proposed amendments at its March 21 meeting, but earlier this month the agency released a notice that the hearing has been postponed to a future date. The delay is so that staff can have more time to evaluate a “large” number of public comments, CARB spokesman David Cleghorn said in an email to GV Wire.

The public comment period closed on Feb. 20.

Cleghorn told GV Wire that the fuel increase cost estimates in the September 2023 report were based on a conservative scenario that did not take into account other potential factors that could affect fuel prices, such as banked credits, futures markets, and regional competition.

Other Costs to Consider Such as Health Impacts

There are other costs that consumers need to keep in mind, such as the health costs of exposure to air pollution, the bulk of which is due to transportation, he said.

CARB estimates that lowering carbon emissions will result in $5 billion in healthcare cost savings and also create an economic benefit of $4 billion in new businesses and new jobs to develop alternative fuel sources, Cleghorn said.

A current CARB staff report predicts that transportation costs will drop by 40% by 2045 “as lower-cost renewables and electricity replace petroleum,” he said.

California is requiring that all new cars and light trucks sold in the state starting in 2035 be zero-emission vehicles.