The City Council of Petaluma, California, has voted to ban new gasoline stations in order to reduce gasoline availability to motorists and accelerate the transition to electric vehicles. The ban does not include existing gas stations, but existing gas stations will not be allowed to add new gas pumps. Instead, they are encouraged to build electric charging bays. The legislation will also streamline the process for adding more electric vehicle infrastructure like electric charging bays and hydrogen fuel cell facilities. The new prohibition is part of Petaluma’s plan to completely phase out carbon emissions by 2030. Petaluma, located 30 miles north of San Francisco, has about 60,000 people. It is 15 square miles in size and has 16 operational gas stations. Neighborhood opposition in Petaluma to a new Safeway gas station prompted years of litigation and promoted the permanent ban on new stations.
Will It Backfire?
Banning the construction of new gas stations does not eliminate the demand for gasoline. At some point, Petaluma residents may have to drive farther to get to an existing gas station or they may eventually have to leave the city to purchase gas, which would increase carbon emissions as they drive farther. Further, the legislation may artificially restrict the supply of gasoline, resulting in its price rising significantly compared to surrounding areas. Despite the city wanting higher gas prices to prompt more people to switch to electric cars, those higher prices could inadvertently prompt residents to drive out of town to purchase gasoline, where prices are lower rather than spending the money to purchase expensive electric cars. Higher fuel prices also disproportionately hurt poorer citizens and strain household budgets, though California seems to ignore this issue with its push to renewable energy and electric cars. Petaluma is a wealthy, overwhelmingly white community, and its local city leaders may be less aware of the impacts of energy scarcity among poorer residents.
Moreover, even to the extent that such a ban would encourage people to switch to electric vehicles, it is unclear that it would mean lower carbon emissions. The extent to which electric vehicles reduce carbon emissions depends on what electricity source is used to power the car. About 43 percent of California’s in-state generation comes from fossil fuel sources and a sizeable amount of electricity demand is imported from adjoining states that also have fossil fuel generators, meaning that electric vehicles in California would still significantly contribute to carbon dioxide emissions.
Other Efforts to Change the U.S. Petroleum Transportation Sector
There are other developments happening at the state level in California and at the federal level. Last year, California banned the sale of new gasoline-powered cars by 2035 and will require 75 percent of heavy trucks sold locally to be electric by that date. There are also plans to build an electric highway along the Pacific Coast where large diesel trucks are replaced by electric trucks and the Pacific Coast states plan to electrify the main shipping routes across the region by installing charging stations for freight trucks. Its early projected cost to California, Oregon, and Washington is around $850 million.
The Biden administration’s $2 trillion climate and infrastructure plan is expected to result in a number of policies to increase renewables and electric vehicles. Other things that will likely be considered are zero-emissions public transit and higher federal fuel economy standards. President Biden has directed federal agencies to consider revising vehicle fuel emissions standards that were cut from the Obama standards by the Trump administration and announced plans to replace the government’s vehicle fleet with electric vehicles made in the United States. It is not known whether they will require American-made batteries in these vehicles.
The city of Petaluma has banned new gasoline stations, hoping to reduce carbon dioxide emissions and to push its residents into higher cost electric vehicles. The strategy may backfire as residents turn to other neighborhoods for their gasoline due to the likely increase in gas prices in Petaluma. And electric vehicles are not carbon free since California still generates electricity from fossil fuels and imports electricity from neighboring states that also generate electricity from fossil fuels. It is not enough to endorse legislation that promises to do something that is supposedly “positive” without thinking through all the consequences of the policy because it will often lead to a cure worse than the disease.