Governor Newsom signs bill expanding fuel options to cut gas prices

What you need to know: Governor Newsom signed AB 30, allowing E15 fuel to be sold in California while the state studies its environmental impact - another tool to help avoid severe gasoline price spikes.

SACRAMENTO - Governor Gavin Newsom today signed legislation that could help bring down the cost of gasoline in California.

The Governor signed Assembly Bill 30 by Assemblymember David Alvarez (D-San Diego), which allows an additional blend of gasoline - E15 fuel specifically - to be sold in the state while the Air Resources Board (CARB) completes its ongoing work to study whether the additional blend can meet the state's clean air requirements.

Last October, the Governor directed CARB to accelerate studying how California could increase ethanol blending in gasoline while maintaining environmental protections. Authorizing the use of this alternative gasoline fuel blend reduces the state's dependence on petroleum and further diversifies the state fuel supply, helping to avoid gasoline price spikes and costs to consumers at the pump.

Thanks to our work with the legislature, we have averted billions of dollars in higher costs at the pump by avoiding the kinds of severe gasoline price spikes we saw a few years ago. While we continue the critical work to stabilize our state's fuel market, we're cutting red tape to provide consumers with more options as we continue our transition to cleaner transportation.

Governor Gavin Newsom

"AB 30 is an example of how we can solve problems thoughtfully in California," said Assemblymember Alvarez. "By authorizing the sale and use of E15 gasoline, we can reduce the cost of gas and maintain our commitment to a cleaner environment. I thank Governor Newsom and Speaker Rivas for their focus on affordability this year, and I look forward to working together on more solutions that improve the lives of Californians in the coming months."

How it works

According to a study conducted by the University of California, Berkeley and the United States Naval Academy, this could lower gasoline prices by up to $0.20 per gallon and save Californians as much as $2.7 billion annually, but also would require infrastructure modifications throughout the state, including at retail gasoline stations.

E15 fuel, which contains 15% ethanol, has been widely adopted in other states and could reduce gasoline prices without adding environmental harm. As of 2023, E15 was sold at more than 3,000 stations in 31 states.

Another study from the University of California, Riverside found that increasing ethanol blending in gasoline would not affect NOx emissions and would reduce particulate emissions.

Keeping gas prices low

Recent actions by Governor Newsom and the legislature have helped stabilize the state's petroleum market and prevented billions of dollars in gasoline price spikes:

• The Governor signed legislation last month that provides a path for a targeted, locally-led, environmentally responsible and safe increase in oil production in Kern County to boost overall fuel supplies in the state.

• Following record gasoline price spikes in 2022, Governor Newsom called for a special session and worked in partnership with the legislature on first-of-its-kind transparency requirements on the oil industry, which have already helped the state manage fuel supply and stabilize prices.

• Moreover, the transparency afforded by that first special session legislation led to the second special session legislation focused on building more stability into California's fuel supply, including by the establishment of a minimum supply inventory and requiring plans for refinery resupply during maintenance, work that is now underway by the CEC.

• Both pieces of special session legislation gave the state new tools to understand and help manage the state's petroleum market - providing more transparency than ever before to allow the state to make informed decisions with respect to our transition away from fossil fuels and towards cleaner, alternative fuels.