Many Californians Are Still Paying a Lot for Gas, but There's a Silver Lining

Chevy Tahoe at a Gas Station 25 photos
Photo: Chevrolet | Edited
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At the time of writing, the national average gas price is $3.26 per gallon. In California, America's most populous state, it's $1.37 more. That means people living in counties like Mono, Del Norte, Humboldt, or Inyo see some downright absurd figures at the pump. But it's not all bad when you think about it for a little while. Here's why.
As I type these words, Hawaii and California have the highest average gas prices in the nation, with $4.69 and $4.63 per gallon, respectively.

On the other side of the aisle, states like Texas or Mississippi have average gas prices of $2.85 per gallon. That's what the AAA data tells us.

People living in Mono, Inyo, or Humboldt counties would surely love to see such numbers displayed at the pump, considering that the average gas price in their areas is above $5 a gallon.

In Mono County, the situation is especially bad. Americans living there regularly commute around 100 miles to work because there's a housing shortage. The average price of gas in those parts of California is above $5.7 per gallon.

There are also a few gas stations that have a sort of hegemony in some parts of the Golden State, which allows them to charge much more than they should.

Gas Stations in California
Photo: ArcGIS Hub
Americans living on the West Coast or not in the contiguous US have to deal with this harsh reality of gas being expensive. However, in most parts of America, that's by design. Californian authorities, for example, are charging almost $0.78 per gallon as tax.

Things that just can't be avoided

Besides the state excise tax, the price you see at the pump also includes:
  • The federal excise tax ($0.18);
  • The low-carbon fuel standard fee ($0.22);
  • The cap-and-trade fee ($0.25);
  • The local sales tax ($0.12);
  • The underground storage tax ($0.02).

That money is taken from drivers and put into the state's roadways and mass transit systems.

Weirdly, last year, Tennessee, New Hampshire, and Alabama had the highest-quality roads in the US. It depends on which part of California you live in or travel to, though! Readers have often told us that it's much better to drive in the southern part of the Golden State.

Besides tax, there are also other costs included in the final price. Transport (distribution), marketing, refining, and the price of crude oil also impact what you see on the screen when you're filling up.

Gas Pump
Photo: Dawn McDonald on Unsplash
Then, there's the blend change. During summer, Californians and other Americans living in states where the gasoline composition changes seasonally pay a bit more. Fortunately, they get something in exchange: more energy. That means your car's average fuel consumption should slightly improve when it's warm.

Remember that the US has limited power to set the price of black gold. That's OPEC's job, a group of petroleum-exporting countries that the US isn't a member of.

Courageously moving forward

It may sound like we are trying to advocate or, better said, make you feel pity for people who choose to live and drive in these high-cost-of-living (HCOL) areas, but that's not what's happening here. It would be great if they had access to cheaper gas, but the state has a clear path forward: it wants to champion the American green movement. That's not going to happen without having everyone chipping in.

Credit where credit's due, the state's Air Resources Board and the Environmental Protection Agency Region 9 promoted all sorts of measures that helped many people in the US to breathe cleaner air. The catalytic converter, for example, is a technological development that appeared thanks to California's stubbornness to make the environment better.

Besides that, the Golden State is an important part of the US. It has the largest population in America, produces the most domestic wine, hosts the cradle of technological innovation, produces more than half of the US veggies and fruits, champions renewable energy generation (although it still imports power from the Southwest), and is the place where actors, musicians, engineers, and many other professionals want to spend at least a few years of their lives.

California Average Gas Price
Photo: AAA
Summing it all up, California's economy is a global powerhouse. To put it a bit better into perspective, it's slightly bigger than France's. That's probably why the state has such a pioneering attitude, even if it might mean that its people pay to support avant-garde policies.

The silver lining

While gas is and will remain expensive for the foreseeable future (fingers crossed, maybe we won't return to a 2022-like scenario – ever), the handy solution is switching to an all-electric car. For years, people have (righteously) complained that transitioning to a zero-emission mobility solution was too expensive. Now, that's no longer the case.

If you can charge at home, work, or for free when shopping, an EV will greatly minimize your running expenses. If you get a good car that won't need much servicing (and EVs generally don't need much expert attention), then personal mobility gets even cheaper.

The obvious choice is buying a brand-new Tesla. Leasing the refreshed Model 3 Long Range for three years with around $4,500 down results in a car note of under $500. You won't be able to buy it at the end of the lease, though. If you want a mileage allocation higher than 10,000 miles per year, the monthly payment increases above $550.

If you're ok with having your driving supervised, then insurance should also be rather affordable through Tesla. Normally, it costs about $3,200 per year to insure a Model 3 Long Range with enough coverage to be comfortable. The automaker's insurance should be about 20 to 30 percent cheaper. But do shop around. You might find that USAA has cheaper premiums. Also, don't forget about Uncle Sam's $7,500. Starting this year, it can be applied at the point of sale, but you must make sure that you're eligible to avoid unwanted headaches down the road.

2024 Tesla Model 3
Photo: Tesla
However, you can do even better. Rent-a-car companies like Hertz are selling used Tesla Model 3s for less than $18,500! Depending on how much you earn (annual gross income), you could also access the used EV tax credit! That's another $4,000 off the price.

Doing better

If you've been paying attention to the automotive world in the past couple of years, you might know that Tesla isn't particularly known for build quality or comfort. That's why we believe that many of our readers might want alternatives. Fortunately, there are!

Depreciation is bringing us some sweet, sweet deals. First-generation EVs from legacy brands that used to sit close to a six-figure sum are now a lot cheaper.

The Audi e-tron is a good example in that regard. It used to have a pre-tax and -fee cost of around $75,000 when it arrived stateside. Today, you can buy one for less than $25,000. Add the used EV tax credit, and that's a $21,000 eSUV!

Don't like four- or five-year-old Audi eSUVs? Don't worry. The BMW iX is also becoming a score. A low-mileage certified pre-owned unit with a couple of years of warranty left will set you back around $60,000.

Photo: Beam Global
If you don't like heavy, high-riding vehicles, the e-tron GT is another great option. The Taycan's half-sibling packs a lot of performance that's now obtainable for $50,000 or less.

Audi and BMW models are a bit on the pricey side because they bring that German quality people love. However, there are more affordable options. For example, you can look at a Nissan Leaf, a Chevy Bolt, a Kia Niro EV, an Ioniq 5 (that's also been quite badly hit by depreciation), or the Mini Cooper SE. I would even dare to add the Toyota bZ4x and Subaru Solterra (same car) to the list because there are some great deals out there. For example, you could finance the Subaru at 0% APR for 72 months or get into a $399-a-month lease.

The world of EVs has never been more inviting than now. Used or new, an all-electric commuting appliance can replace your gas-powered ride with ease and not many extra costs. In fact, depending on your choice, you might be better off with an EV.

Just make sure that charging the battery won't be a hassle and that the model you picked doesn't have too many recalls or is known to have many defects. Replacing a high-voltage battery is quite expensive.
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About the author: Florin Amariei
Florin Amariei profile photo

Car shows on TV and his father's Fiat Tempra may have been Florin's early influences, but nowadays he favors different things, like the power of an F-150 Raptor. He'll never be able to ignore the shape of a Ferrari though, especially a yellow one.
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