Why are gas prices so high? Many people are quick to point to oil prices and taxes, but there might be a hidden surcharge in each gallon of gasoline that doesn't come from the state.
"The state is only 11% of that dollar," said California State Senator Ben Hueso. "They are 89%, so when you see a drastic increase, it's not caused by an increase in the gas tax."
Senator Hueso said even if you took away all the taxes, California's gas prices would still be the highest in the country. A new bill before Sen. Hueso's committee, SB1322, aims to find out why. It would require companies to share how much they are profiting from a gallon of gasoline.
It's based in part on a 2019 report from California's Energy Commission which found the actual price of a gallon of gas was much higher than the expected price based on the costs of production. In a report published in October 2019, the CEC said:
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"...the primary cause of the residual price increase is simply that California’s retail gasoline outlets are charging higher prices than those in other states."
The Western States Petroleum Association represents oil companies on the west coast. They told NBC 7 they could not discuss prices, but pointed to California's high taxes and regulations when asked about the cost of gasoline.
"We recommend the state of California also look at where the costs are actually going," said Argelia León of WSPA. "Where are the fees for the fuel tax going? How are they being used?"
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The WSPA also said any bill that targets the oil industry will make costs go up.
SB1322 would require refineries to share the average cost for oil, and the profit amount they make on the gasoline they sell. Senator Hueso said he thinks businesses should be transparent about their practices when it comes to vital products such as gasoline, which plays a major role in our economy and safety.
"We need to be better-informed consumers," said Hueso. "Anytime we can get the information, I think it's a wonderful thing."
SB1322 is currently before the state Senate's Committee on Energy, Utilities and Communication. It does not yet have a date to be heard.
