California Opens Pump to E15 as Gas Prices Near Record Highs
California has cleared immediate sales of E15, a 15% ethanol blend, as gasoline prices hover near $6.14 a gallon in the state.
California will allow the immediate sale of E15, a gasoline blend containing 15% ethanol, after Governor Gavin Newsom signed Senate Bill 795 on Saturday. The move removes the last regulatory barrier in a state that had been the only one in the country where the fuel could not be sold, more than a year after state senators voted unanimously to permit it.
"This common-sense bill cuts unnecessary red tape while maintaining our environmental and safety standards. We're helping make E15 a real option for California drivers," Newsom said in a statement.
The change is expected to benefit ethanol producers and corn growers by opening the most populous US state to the higher blend. Eric McAfee, chief executive of Cupertino-based renewable fuels producer Aemetis, estimated it could add roughly 650 million gallons of annual ethanol demand in California.
"Currently ethanol sells wholesale for about $2.30 a gallon, so it will result in significant cost savings compared with gasoline in California," McAfee said.
Average gasoline prices in California were hovering near record levels of about $6.14 per gallon on Sunday, against a national average of $4.44 per gallon, according to GasBuddy data.
The state's approval of E15 comes as Congress weighs separate legislation to allow year-round sales of the blend nationwide. The issue has gained urgency after the US war with Iran rattled global oil markets, pushing up fuel prices and raising concerns about crude supply disruptions. The impact has been particularly acute in California, which already records some of the highest gasoline prices in the country because of stringent fuel standards, relatively high taxes and its reliance on imported petroleum products.
The Renewable Fuels Association said E15 could lower retail gasoline prices by roughly 20 cents per gallon and save California drivers at least $2.7 billion annually, citing a 2024 study by economists at the University of California, Berkeley, and the US Naval Academy.