California Refineries Close as Gasoline Demand Slips into Permanent Decline - CleanTechnica

California’s refinery sector is contracting primarily due to a sustained decline in gasoline demand rather than solely because of environmental regulations or compliance costs. Gasoline consumption in the state has steadily decreased by about 11% from over 15 billion gallons in 2015 to approximately 13.4 billion gallons in 2024. This decline is driven by more efficient internal combustion engines, increased hybrid adoption, and a rapid rise in electric vehicle sales, supported by policies like the Advanced Clean Cars II mandate aiming for 100% zero-emission passenger car sales by 2035. As a result, refinery margins have eroded, making reinvestment unattractive and prompting closures of major refineries such as Phillips 66’s Wilmington and Valero’s Benicia, which together supply around 15% of California’s gasoline. In response, California’s government is actively engaging with refinery operators and potential buyers to delay or prevent closures, considering financial incentives and regulatory concessions to stabilize fuel supplies, preserve jobs, and protect local