Oil pumpjack, San Benito County. (Photo: Katy Grimes for California Globe)
Californians Choosing Between Gas or Groceries, Utility Bills or Rent
Now that Gavin Newsom has created this mess, he’s directing the energy commission to do something to stop the refinery closures
By Katy Grimes, August 11, 2025 7:53 am
How is it possible that in California, hard-working families must choose between gas or groceries, utility bills or rent?
The average cost for a gallon of regular gas in the U.S. today is $3.138.
California’s cost for that same gallon of regular gas is $4.500, the highest cost in the entire country, according to AAA. Hawaii even pays less for gas.
In 1988, the state of California only imported about 4.5% of all the oil that we consumed in our state. By 2020 we were importing over 70%.
Approximately 30% of the cost of a gallon of gas in California comes from taxes and fees.
In 2023, 20% of the cost of a gallon of gas in California came from taxes and fees, according to WSPA, while only 1% was attributable to net profits from the oil industry.
While Californians are suffering under the highest gas prices in the country, and more than 2.2 million Californians are behind on their utility bills, Governor Gavin Newsom and the state Legislature are prioritizing redistricting the electoral districts to squeeze Republicans out of 6 more U.S. House seats.
California has an energy problem – a big energy problem, and even Newsom has noticed. But it’s his awful policies that brought the state to the brink.
In April, Gov. Gavin Newsom Thursday directed state officials to increase efforts to guarantee reliable fuel supplies for the nation’s biggest auto market, prompting oil companies to blame state policies for difficult business conditions and high pump prices, Reuters reported.
Gov. Newsom has been agitating for some time against “Big Oil” and their “windfall profits,” but always leaves out his and Democrats’ important role in escalating oil and gas prices in California through regulations, surcharges, “clean-air” and “low carbon” programs, cap and trade and more schemes, the Globe reported in April.
Gov. Newsom signed a package of “sweeping legislation” in September 2022 to achieve statewide carbon neutrality as soon as possible, and no later than 2045, by establishing an 85% emissions reduction target, capping oil wells, slowing oil and gas permitting, making it impossible to increase refining capacity, and entirely phasing out oil and gas starting in two years.
That “sweeping set of laws” Newsom touted was 40 new climate change bills regulating California businesses and its people.
Before Gov. Newsom, in 2018, then-Governor Jerry Brown signed SB 100 by then-Sen. Kevin De León, which established the policy that eligible renewable energy resources and zero-carbon resources supply 100% of all retail sales of electricity to California end-use customers and 100% of electricity procured to serve all state agencies by December 31, 2045, the “100% clean energy policy.”
California lawmakers also passed Senate Bill 2, the Renewable Portfolio Standard program in 2011, which required all retail sellers of electricity and publicly owned utilities to buy 33 percent of the electricity delivered to their retail customers from renewable resources by 2020.
And of course, who can forget the state’s greenhouse gas reduction and clean energy goals since 2006 when AB 32, the California Global Warming Solutions Act of 2006 was passed by the Legislature and signed into law by then-Gov. Arnold Schwarzenegger.
At that time, AB 32 required statewide greenhouse gas emissions to be reduced to at least 40% below the 1990 level by 2020. But the state achieved that in only a few short years, largely because California does not have much greenhouse gas pollution, so lawmakers moved the goal posts out to 2030, which allowed the state to continue passing more and more strict regulations and laws.
Those goalposts were then moves out to 2045 to achieve “carbon neutrality.”
In the past decade, the California Public Utilities Commission has approved rate hikes nearly three times higher than inflation. The utility companies are happy, while ratepayers were given the middle-finger.
In 2024, Gov. Gavin Newsom signed SB 1221 which authorized the CPUC to approve up to 30 pilot projects that facilitate cost-effective decarbonization in priority neighborhood decarbonization zones. The pilot projects are intended to provide state decision makers with a greater understanding of the challenges that arise when decommissioning parts of the natural gas system.
According to SB 1221 bill analysis:
In 2019, the City of Berkeley adopted the nation’s first ban of natural gas hookups in most new residences and commercial buildings. Since then, about 50 other California cities and counties have adopted reach codes (those that surpass state building standards) or ordinances that either limit or ban the installation of gas connections to new buildings. Additionally, the Bay Area Air Quality Management District adopted rules prohibiting installation of natural gas furnaces and water heaters in residential and commercial settings beginning in 2027.
While a Federal court overturned Berkeley’s gas ban, the CPUC is “actively considering the issues of zonal decarbonization with concurrent decommissioning of the natural gas utility system.”
None of this helps lower the cost of home energy bills, and in fact only increases the cost to heat and cool your home, cook your meals, and wash your dishes and clothes.
As Andy Caldwell reported, “the biggest death blow to the future of the industry are the state mandates in effect that will effectively ban natural gas in new construction along with banning the sale of diesel- and gas-powered vehicles in this state. The latter has already caused the largest trucking company in our region to close their business.”
“The pending shutdown of the Phillips 66 refining complex in Los Angeles will reduce daily refining capacity by 8.9%,” USC Professor Michael Mische warned in March. “The loss, although painful in terms of its impact on consumer prices, is absorbable and the deficit in production and gasoline levels will be compensated by imports of finished fuels from Washington State and perhaps Gulf Coast refineries.”
Gavin Newsom’s and Democrats’s “carbon-neutral” policies have forced California to the brink of a very serious energy crisis.
Chevron Oil Company announced last August their corporate relocation to Houston Texas from the Bay Area; Phillips 66 announced that its Los Angeles refinery will shut down by October 2025; and Valero announced that it will shut down its Benicia refinery in April 2026.
With fewer refineries, will not only force California to rely on foreign oil sources, gas and energy prices will climb.
Add to that devastating news, Senate Bill 1137, which took effect on June 27, 2024, bans the construction of new oil wells and the maintenance or repair of existing wells within 3,200 feet of loosely defined “sensitive receptors,” potentially threatening to shut down energy resource infrastructure statewide.
Add to that, California Senator Scott Wiener (D-San Francisco) introduced a bill in February to hold “Big Oil” responsible for natural disasters in California. You read that right – Senator Wiener is blaming the oil and gas industry for natural disasters, or disasters that should have been mitigated by the State of California – like wildfires. Sen. Wiener’s Senate Bill 222 would allow the state FAIR Plan, insurance companies, and individuals to sue oil and gas companies for wildfire damages.
Gov. Gavin Newsom has been targeting the oil and gas industry with stifling state regulations, impossible laws like the 3,200 foot setback for oil wells, signing the gas price gouging law, and chasing Chevron out of the state.
As oil expert Dave Noerr told the Globe last year, “The growing difference between the price of crude oil and the retail cost of gas and diesel as well as the additional cost Californians pay compared to every bordering state and the rest of the U.S. is:
- The Sacramento surcharge
- The cost of California
- The growing of Government
- The Low Carbon Fuel Standard
- The Cap and Trade Program
- Vapor recycling requirements
- Data collection
- Air quality mandated equipment replacements”
Noerr added, “So California, the fact of the matter is, you are paying the same or less for the crude oil contained in a gallon of gas or diesel. You are just paying a lot more for government.”
So now that Gavin Newsom has created this mess, he’s directing the energy commission to do something to stop the refinery closures – except the CPUC and Air Resources Board – his state agencies – are continuing with business as usual.
A California native and Navy mom, Katy lives in Sacramento, CA.
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Gas increases is to force EV onto people.
once all or most all are subject to one main power source – they are easier to control.
They will turn to demonizing those using natural gas like they did those anti-vaxx
I can only assume the task force aimed at finding the price gougers saw it was CA gov
As for the article’s mention of the PUC and rate increases: The utilities are capitai intensive (labor cost is insignificant to the total operating budget), cost plus businesses. The idea is like if it costs $100.00 to run the business, the utility gets a buck or two over cost. That’s not to say the utilities don’t send out inflated rate case petitions, but that stuff is so buried in paperwork a traditional investigation starting at the top would have trouble ferreting out the double dipping and other fraud, and those at the top have insulated themselves from responsibility for it. The place to start is about 3 months before the end of the fiscal year when the operaring budget for a local entity runs out. When the local budget is drawn up and presented to middle management, middle management says “you need to make improvements here and here,” which results in the local entity running out of operating money in, say september or october, middle management isn’t going to fund the shortfall even if local management stupidly dared to ask, and the local manager has his name on it and it’s his responsibility. So if there is construction of new facilities for a new housing tract that the developer is paying for but the local entiry has run out of operating budget money, how does the local manager keep his bosses – who forced this predicament on him, happy? “If there’s a cloud in the sky, charge it to storm” instead of the project that’s already paid for. Storm is a cost that can be presented as a part of a rate case and recovered from the rate payers. For the following I already hear the deafening shout of “bullshit!!!” from the mass who have no idea of how these things work, but utilities don’t make money selling electricity (BULLSHIT!!!), they make money by presenting favorable rate cases, which sets the rates charged to consumers for delivered electricity. It must be considered that while there is a revolving door between the utilities and the PUC, the PUC isn’t always favorable to the utilities as they aren’t always favorable to the rate payers, politics and such. Also, the investors don’t care how the money is made so long as they get a return that is acceptable to them. The board of directors has no idea of nor cares about the realities of the bottom end of the business, so long as the investors are happy and they can continue to milk the several companies they each serve on the boards of: boards of directors are a part time occupation.
Most analysts forget to mention the new administrative burdens placed on the refineries from Sacramento. New laws require them to notify the CEC of their inventory levels and maintain minimum levels as directed by the CEC, and who they sell their product to and for how much. Does this sound capitalist?
The people of California must be really stupid. They keep electing these lying, cheating, crooked snake-oil salesman politicians like Gavin Newscum and the moron Karen Bass over and over. Is there something in the water there that makes them do this?
To: LongTimeTexan, correction – we are not stupid people. You’re stupid for hanging on to the belief that politicians are “elected.” They are “selected.” Long Time Voter Fraud. Class dismissed.
Exactly right! I doubt we have had a real election in the last 30 years.
Pelosi did that and I don’t believe it was her first date either.
its adorable in a state where the government banned voter ID and allows illegals to vote in state elections that you believe the citizens voted for him. especially when he illegally ran in the recall.
I’m thinking voter fraud nobody i know in California likes Gavin nor wanted to vote for him I hope they keep a better eye on this come the next election.
Gerrymandering, mail in ballots to hundreds of people who “reside” in the same vacant lot or laundramat, extending elections until enough ballots are “cured” to ensure the democrats win and “free stuff.”
Newscum is scrambling, because he knows that if there is a gas crisis in California, it will be broadcast all over the nation, and his Presidential ambitions are toast. This dimwit should have considered that before causing the refineries to notify everyone that they were closing.
“Carbon Neutrality” is code for complete government control of citizen’s use of energy, and permanent rationing.
Spot on, once again Protect Freedom!
And this is the government we pay for through these forced taxes!
Not only do we pay for this stupidity through our gas taxes but we pay a heavy emotional tax when many have to choose between gas or groceries!
Control the food and yes the gas and you control the people!
WEF global puppet masters must be so proud of the Boy Governor!
Quality of life be damned!
@One Fed Up Cali Girl, Exactly right!
Democrats do this
even if you hate trump vote Republican because the left are weirdos who have no morals and will make everyone homeless. they don’t care about you or me. better the devil we know with Trump then these liars who promise to do one thing clean up homelessness and ten years later 20 billion down we have more homeless then ever before.
that’s the one promise newsome made to get elected. but the left doesn’t even care.
Let’s be real here : Democrats want us in either 1) Mass transit
2) Electric vehicles where they can ration the power or reduce it centrally
3) On bicycles in “15 minute cities” see California Insider’s recent YouTube video with Steve Bennett if you don’t believe me…
All these taxes and environmental restrictions and regulations are being implemented to make private transportation so expensive that we buckle and choose from one of the 3 options above.
Newsom likely creamed his skinny-jeans when the refineries announced their closure plans and figured that he’d won the Democrats long game in California.
Unfortunately, the majority of the populace doesn’t share the Dems restriction goals and are smarter than the Dims, realizing that the modern economy runs on petroleum products and changes like that take time, and planning, and not some arbitrary date set by the globalist cabal.
Screw off, Newscum… your Presidential aspirations are destroyed, due to your incompetence, hubris and legacy of FAILURE as California Governor.
there reason for this is because of Getty Oil. California has oil and natural gas rigs in Saudi Arabia. California gets around 80% of its oil and natural gas from Saudi Arabia (despite have one of the largest reserves in the nation.) Fuhrer Newscum has ties to Gettie oil through his father who was worked for them. follow the money every gallon of oil and natural gas from Saudi Arabia a percentage goes to Fuhrer Newscum through stock options.
newscum has messed up California so bad that it’s going to take centuries to undo what he did. If ever.
Keep voting Blue, yaaay. I even had a Liberal Elitust say they wouid be happy paying $20 a gallon. Thats the mindset running the Crumble State formerly Golden State.