California

POPULATION (2015): 39,144,818

REGISTERED CARS & LIGHT TRUCKS: 27,779,811

ANNUAL GAS CONSUMPTION (2014): 14.6 Billion GPY

TOTAL RETAIL STATIONS: 7,513

Maximum E85 use:1 Billion GPY
FFVs in use:1,288,662
E85 stations:127
Flex Station implied demand:+286
Maximum E15 use:11.7 Billion GPY
EPA approved E15 vehicles:22,223,848
E15 Station implied demand:+6,010

Fuel specifications

Gasoline:

RFG is required across the state year round. All gas sold in state must meet certain specifications determined by the state’s predictive model.

Reid Vapor Pressure:

During winter months, the RVP reference limit is 9.0 psi. In summer months, the RVP point is 7.0 psi. The summer season varies for different regions in the state, but if a producer or importer uses the CaRFG Phase 3 Predictive Model to certify a final blend that does not contain ethanol, the RVP reference point is then 6.9 psi. The RVP limit is expressed as a range: minimum RVP is 6.40 psi, and the maximum is 7.2 psi. Lower-RVP gasoline is required to be at the terminal and retail level for these time periods: April 1-October 31 (South Coast Air Basin, Ventura County, San Diego Air Basin, Mojave Desert Air Basin, Salton Sea Air Basin), May 1-September 30 (Great Basin Valley Air Basin), May 1-October 31 (San Francisco Air Basin, San Joaquin Air Basin, Sacramento Valley Air Basin, Mountain Counties Air Basin, Lake Tahoe Air Basin), June 1-October 31
(South Central Coast Air Basin excluding Ventura County, North Central Coast Air Basin). Producers and importers must also comply with the RVP limits one month before the time periods, in order to help facilitate the sales transition to lower-RVP gasoline.

While California has no specific ban on E15, other regulations prevent the sale of E15 at this time.

Contact information for key state regulatory agencies

Division of Measurement Standards, 916-654-0466

State Laws & Incentives

Low Carbon Fuel Standard
California's Low Carbon Fuel Standard (LCFS) Program requires a reduction in the carbon intensity of transportation fuels that are sold, supplied, or offered for sale in the state by a minimum of 10% by 2020. The California Air Resources Board (ARB) regulations require transportation fuel producers and importers to meet specified average carbon intensity requirements for fuel. In the regulations, carbon intensity reductions are based on reformulated gasoline mixed with 10% corn-derived ethanol and low-sulfur diesel fuel. Liquefied petroleum gas (propane) is exempt from LCFS requirements, as are non-biomass-based alternative fuels that are supplied in California for use in transportation at an aggregated volume of less than 3.6 million gasoline gallon equivalents per year. Other exemptions apply for transportation fuel used in specific applications. The LCFS Program allows producers and importers to generate, acquire, transfer, bank, borrow, and trade credits. Fuel producers and importers regulated under the LCFS must meet quarterly and annual reporting requirements. For more information, see the LCFS Program website. (Reference California Code of Regulations Title 17, Section 95480-95490; Executive OrderS-01-07, 2007; and California Health and Safety Code 38500-38599)

Alternative Fuel Tax
Properly blended E85 is exempt from state excise tax. 

Federal Incentives

Alternative Fuel Infrastructure Tax Credit
(Originally expired 12/31/13 - retroactively extended through 12/31/16, by H.R. 2029) Fueling equipment for E85 installed between January 1, 2014, and December 31, 2016, is eligible for a tax credit of 30% of the cost, not to exceed $30,000. Station owners with multiple locations can use the credit towards each site. For more information about claiming the credit, see IRS Form 8911.

Ethanol Infrastructure Grants and Loan Guarantees
The Rural Energy for America Program (REAP) provides grants and loan guarantees to rural (population less than 50K) small businesses to purchase renewable energy systems or make energy efficiency improvements. Eligible renewable energy systems include equipment used to distribute flexible fuels. The maximum grant funding is 25% of project costs and the maximum loan guarantee is $25 million. The program is funded through fiscal year 2018 but is subject to congressional appropriations thereafter. For more information, see the REAP website.

Point of Contact
Office of Rural Development, Business and Cooperative Programs
U.S. Department of Agriculture
Phone: (202) 690-4730
http://www.rurdev.usda.gov/

Ethanol plant direct E85/ethanol sales

Click here for a complete list of domestic ethanol producers and sales contacts for E85/direct ethanol sales

E15/Flex Fuel Profit Estimate
line
California
AVG STATION (162,000 GPM)
Average Retailer:
New gallons/$$/Mo E15 & Flex: 30,000 $5,000
New Customers/Mo:+3,331 
Additional Merch. Margin from above:$9,700
RINs not applied to reduce price:$1,500
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TOTAL NEW PROFIT/MO  $16,200
Top Performing Retailer:
New gallons/$$/Mo E15 & Flex:71,000$11,800
New Customers/Mo:+7,900 
Additional Merch. Margin from above:$23,100
RINs not applied to reduce price:$4,100
line
TOTAL NEW PROFIT/MO  $39,000

Want to see what E15/Flex fuels could do for your operation?

Try out the E15/Flex fuel profit Estimator
A Roadmap for Ethanol cover

a roadmap for ethanol

You’re thinking about adding or switching to a new fuel grade on your product slate, and you’ve considered premium and diesel, because those are the fuels all station owners consider. But today, the market is different, and you’re curious about what E15, E85, and other flex fuels could do for your business. Good move.

Download the Full Guide