October 2, 2022

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Gas prices: California's 'mysterious surcharge' increases pain at the pump

Gas prices: California’s ‘mysterious surcharge’ increases pain at the pump

LOS ANGELES (CABC) — California drivers know that gasoline is much more expensive in the Golden State than anywhere else in the state, and they know that the cost of fuel is pumped up from state taxes.

But there’s also an extra 30 cents added to the price of a gallon of gas—and no one can explain why.

“This mysterious additional cost of gasoline will only go to suppliers,” said UC Berkeley professor Severin Bornstein. “We don’t pay what they pay for, we don’t know who gets the money.”

Bornstein, director of the Energy Institute at UC Berkeley, says 30 cents a gallon costs California drivers about $4 billion annually.

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He says the surcharges were raised after a catastrophic 2015 fire at the Torrance refinery.

“After the 2015 Torrance refinery fire, our prices went up significantly compared to the rest of the country and have not returned to the same relationship,” Bornstein said.

Experts say the higher prices in California are due to a combination of factors, including gas taxes and the cost of making cleaner gasoline. The state is also a “fuel island,” meaning that it receives no supplies through interstate pipelines.

An effort began a few years ago to investigate the “extra cost of obscurity” but that effort was abandoned due to a lack of progress.

With gas prices continuing to rise, Bornstein says it’s time to solve the mystery.

“It costs Californians about $4 billion a year,” Bornstein said. “It sounds like spending a few million dollars to find out would be a wise spending.”

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