Leveraging Refinery Dominance in Transportation Fuel Supply to Encourage Adoption of Climate Change-Mitigating Transportation Technologies in California

California’s main source of greenhouse gas emissions is transportation, a relatively uncontrolled sector. Of the major energy commodities used by individuals, transport fuels are alone in lack of utility regulation: the dominance of refineries as transportation fuel suppliers suggests there may be an opportunity for California to engage its refining industry about transitioning into a transportation fuel utility role. While this concept could be extended beyond California, it is uniquely suited to California because of the State’s fuel isolation from the rest of the country: with its demand for a boutique low-pollution fuel, California is served almost exclusively by Californian refineries that face a different set of regulations than most other American refineries do. Due to infrastructural barriers and long vehicle lifetime, most forecasts predict slow penetration of alternative transportation technologies, even as policymakers suggest an urgent need for rethinking the transportation system. These infrastructural barriers, including the chicken-and-egg problem of building fuel supply stations and vehicles that use alternative fuels, may be more easily overcome by a single planning body than by a market that only uncertainly rewards first movers. By ensuring supply of fuels the state wishes to promote, California can more easily launch alternative vehicle policies and incentives.