How SAF Production Unlocks Greater Fuel Supply Resilience

April 27, 2026

By: Harold “Skip” York, PhD, Nonresident Fellow Baker Institute for Public Policy at Rice University Study

Key findings:

SAF could increase California gasoline supply by 4–6%

Added supply could reduce gasoline production costs by 22–40 cents per gallon

SAF improves resilience through renewable naphtha, refinery reoptimization and marine logistics

Executive Summary

California's ability to make SAF (Sustainable Aviation Fuel) in Northern California creates three interconnected mechanisms that improve the state's gasoline supply: by growing volume through blending renewable naphtha from the SAF process into the gasoline blending; changing operations of in-state petroleum refineries to make more gasoline; and by shifting import logistics from petroleum jet fuel to gasoline. The state’s net gasoline supply uplift ranges between 4 and 6% when current instate SAF capacity is fully utilized. This additional supply could reduce the cost of making California gasoline by 22 to 40 cents per gallon, largely by backing out more SAAC Project Code: 2026.02 2 expensive imports. The combination of these drivers reduces not only absolute price levels, but also price volatility. This benefit extends beyond Northern California as existing rail infrastructure reliably satisfies Southern California's RD (Renewable Diesel) demand with replacement barrels from Midwest and Gulf Coast RD plants. Growing the supply of RD by rail also could free additional Northern and Southern California marine capacity for more gasoline imports — a pan-California benefit with direct implications for the price spikes that frequently follow unplanned refinery outages or geopolitical crises.