As of 2025, California’s total gas taxes and fees amount to approximately $1.15 per gallon, which includes state excise taxes, local sales taxes, and various fees. The state excise tax alone is currently around 59.6 cents per gallon, with additional costs from environmental programs and other fees contributing to the total.
AAA has today’s national average gas price at $3.05 per gallon. California’s is $1.58 higher per gallon at $4.62 per gallon on average for mid-grade gas. If you use premium gas or diesel that will cost you $5.04 and $5.12 per gallon, respectively.
And this is why: California’s total gas taxes and fees amount to approximately $1.15 per gallon on top of the gas price per gallon… so says the California Energy Commission.
California wants you to believe that the total gas taxes and fees amount to approximately $1.15 per gallon – here is the official breakdown:
The California Energy Commission estimated that environmental compliance costs added as much as $0.54/gal as of March 2025, because of the state’s Cap-and-Trade Program and Low Carbon Fuel Standard.
However, the U.S. Energy Information Administration reports:
“Most of the gasoline consumed in California is refined within the state due to lack of petroleum infrastructure connections. California is geographically isolated from other U.S. refining centers because no pipelines supply California from across the Rocky Mountains and only a limited number of pipelines deliver to the West Coast from the Gulf Coast. Of the refineries outside of California with physical access to the state’s gasoline markets, only a few can meet California’s stringent fuel blending requirements.”
“California also imports gasoline from other countries, such as India and South Korea, to meet its fuel supply needs. Other countries produce California-specification gasoline, but high shipping costs usually limit imports to periods of refinery outages or the summer driving season.”
“In addition, West Coast refineries have historically maintained lower inventory levels compared with the U.S. average, and California refineries have been closing, with more closures on the horizon. All of these supply chain issues mean that California gasoline prices are more volatile and subject to large spikes, especially if any of the limited number of refineries go offline for maintenance or have an unexpected outage.”
And this:
California also mandates its own special blend of gas designed to reduce pollution and improve air quality. This fuel burns cleaner but is more expensive to produce because it requires more processing steps and expensive blending components.
Refiners outside the state only make this blend to supply California’s market, meaning that California primarily relies on in-state refineries for its gasoline supply, the U.S. Energy Information Administration reports.
Here is the rest of the story:
Supply side issues also contribute to higher California gasoline prices relative to the rest of the country.
Most of the gasoline consumed in California is refined within the state due to lack of petroleum infrastructure connections. California is geographically isolated from other U.S. refining centers because no pipelines supply California from across the Rocky Mountains and only a limited number of pipelines deliver to the West Coast from the Gulf Coast. Of the refineries outside of California with physical access to the state’s gasoline markets, only a few can meet California’s stringent fuel blending requirements.
California also imports gasoline from other countries, such as India and South Korea, to meet its fuel supply needs. Other countries produce California-specification gasoline, but high shipping costs usually limit imports to periods of refinery outages or the summer driving season.
In addition, West Coast refineries have historically maintained lower inventory levels compared with the U.S. average, and California refineries have been closing, with more closures on the horizon. All of these supply chain issues mean that California gasoline prices are more volatile and subject to large spikes, especially if any of the limited number of refineries go offline for maintenance or have an unexpected outage.
This is why California’s gas prices are the highest in the country – up to $5.85 per gallon.
