A recent court decision by California’s Fifth District Court of Appeals has created new roadblocks to oil and gas production in California, further contributing to our state’s long term decline in oil production and high gas prices.
Although long one of the country’s top oil producers, since 2000, California’s oil production declined by over 40 percent, according to US Energy Information Administration data. This decline has made us more dependent on imported fuel and increased costs for fuel consumers.
Kern County, once America’s top oil producing county and a major center of California production, attempted to take constructive action to expedite approval of new oil wells. Local leaders created a new and more efficient permit application process, known as the Kern County Zoning Ordinance. This new policy organized requirements into a user friendly checklist, and if producers submitted an application fulfilling the stated requirements, they could have a permit in just seven days.
Anti-oil activists immediately sued to stop permits from being granted.
While the court rejected the activists’ argument that any streamlined process should be blocked, the February 2020 ruling has still delayed the new process by at least six months, effectively blocking permits from being issued while the county makes revisions.
Such delays are not without human consequences, both to fuel consumers and to our economy. GasBuddy ranks California second only to Hawaii in fuel prices, at about $1 per gallon above the national average.
Roadblocks to local production make California more dependent on foreign and out of state producers. This unnecessary dependency drives up our fuel costs, causing a hidden tax on the consumer.
With surging homelessness impacting California, Governor Newsom has pledged bold action to address homelessness. We all can agree that our state’s high cost of living is a problem that requires smart solutions, and reducing fuel costs is critical. According to the nonpartisan Institute on Taxation and Economic Policy (ITEP), in comparison to other taxes, gas taxes are 16 times harder on the poor than the rich and eight times harder on the middle class.
We applaud the Governor for recognizing many Californians are finding the state unaffordable, and that this problem demands urgent attention. That’s why the Institute for Gas Price Reduction urges policymakers to take decisive action to expedite new responsible local oil and gas production to help lower the price of gas for consumers.