Banning New Gas Stations Won’t End Consumer Demand, But It Will Inconvenience Motorists

If you’ve ever had to wait in a line at the gas station, you know it can be an incredibly frustrating experience – one filled with impatient motorists fighting over a limited number of pumps. And this experience can be made all the worse when the high cost of gas means your money gets you less fuel than it used to.

Yet, this is precisely the circumstance in which many Los Angeles motorists may soon find themselves if city officials get their way. Elected officials in America’s second-largest city are considering a motion that would ban permitting for any new gas stations within city limits and prohibit existing stations from adding any new fuel pumps. The motion would, however, allow for the addition of electric vehicle (EV) charging stations, a move that is in line with other costly green energy initiatives being peddled by environmental activists and lobbyists around the country. Proponents, such as city council member Paul Koretz, claim that the motion is necessary to “build toward fossil fuel-free transportation” and fight climate change.

The pure scale of the Los Angeles proposal sets it apart from many of the plans being discussed in other large metropolitan areas. The proposal, which is not yet finalized and must first face a committee hearing this month, is inspired by the Bay Area city of Petaluma, California, which last year similarly voted to ban new gas stations with the goal of becoming carbon neutral by 2030. 

Other small cities ranging from Santa Rosa and Rohnert Park, California to Bethlehem, New York are also considering such measures. Los Angeles, home to over 4 million residents, would be by far the largest city to do so.

While consumers are unlikely to feel the effects of new gas station bans immediately, there is little doubt that such drastic actions will significantly impact their wellbeing in the long run. America remains an automobile-dominated country with some 238 million drivers on the road, and most of these drivers drive gas-powered vehicles. 

This predicament is particularly true for low-income Americans who cannot afford the price of the latest Model 3 Tesla or any of the other EVs currently on the market. Indeed, in 2021 the sticker price of a new EV was roughly $11,000 morethan for a gas-powered vehicle. Even when consumers take advantage of federal EV tax credits, or any number of state programs, the cost of an EV almost certainly exceeds that of a traditional gas-powered car. This calculation also does not include other costs such as the need for a home charging station, which can range anywhere from $1,000 to $2,500, or the need to eventually replace an EV battery, which on average costs $5,500.

In Los Angeles, 16.9% of the population lives below the poverty line. Roughly 650,000 Angelenos are just scraping by, and most, assuming they own a car at all, likely drive a gas-powered vehicle. These individuals are more likely to be impacted by a ban on new gas stations and the artificial scarcity that will inevitably ensue. A lack of retail competition may also keep gas prices higher in some neighborhoods, only further adding to the pain felt by motorists. California drivers already face the highest gas prices in the country. A ban on gas stations permits will only make matters worse.

Los Angeles city leaders, and leaders of other cities considering similar proposals, should pump the brakes on plans to end permitting for new gas stations. Such draconian laws will do little to curb global carbon emissions and will negatively impact drivers’ ability to fill up their cars. They will also disproportionally harm low-income Americans, who are more likely than their wealthy peers to rely on gas-powered vehicles. 

Nate Scherer is a Policy Analyst with the American Consumer Institute, a nonprofit education and research organization.

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