Like the rest of the U.S., fossil fuel prices in Oregon and California fluctuate up and down based largely on crude oil prices (for example, they have ranged from about $2.00 to more than $4.00 per gallon in the last 10 years). An increase due solely to the Clean Fuel policies is hard to see in the “noise” of gasoline and diesel pump price fluctuations, but does appear to be small.
The estimated maximum increase of gas cost per gallon attributable to the Clean Fuel Standard in Oregon for 2017, based on carbon intensity reduction and credit price, was less than a penny. This is a maximum estimate that assumes fuel providers must buy all of their credits (rather than make improvements) and pass 100% of their cost on to consumers. Oregon’s program was established in 2016 and has decreased transportation fuel carbon intensity by approximately 1%.
California’s maximum estimated pass-through cost for gasoline attributable to their Low Carbon Fuel Standard (LCFS), based on carbon intensity reduction and credit price, was 13 cents per gallon total in 2018 or about a penny and a half increase for each year of the program. Again, this is a maximum estimate that assumes high-carbon fuel providers must buy all of their credits (rather than make improvements) and pass 100% of their cost on to consumers. This maximum estimate also doesn’t incorporate the flexibility of the program to bank credits over time, which helps fuel providers to plan for and minimize their costs. California’s LCFS was established in 2011 and has achieved an estimated 5% reduction in carbon intensity.