California E85 sales surge past 100 million gallons as prices bite

California’s E85 market climbed to roughly 110 million gallons in 2025, up more than 600% from about 15 million gallons in 2015, but the next wave of growth is getting tied up in retail pricing, infrastructure and regulation. Pearson Fuels said the state’s network now includes its 500th E85 station and about 625 pump locations, giving drivers more access just as the market has moved close to record volume.

The volume run has not been a one-off spike. Pearson Fuels said California motorists bought 114.7 million gallons of E85 in 2024, just below 118.5 million gallons in 2023, and said average annual E85 use per flexible-fuel vehicle rose from 14 gallons in 2016 to 103 gallons in 2023. The California Air Resources Board’s annual E85 chart is based on reported Test Program Exemption data, the state’s underlying reporting mechanism for tracking those sales.

Price has done much of the work. Pearson said E85 was about $2.50 a gallon cheaper than gasoline when it marked the station milestone, and said drivers in some Tracy locations were seeing E85 at about $1.85 a gallon. The spread matters most when gasoline pushes above $6 a gallon, turning a flex-fuel label into real pump-side savings for California drivers.

The bigger constraint now is access. Assemblymember Rhodesia Ransom introduced AB 2046 on Feb. 17, 2026, to legalize federally approved E85 conversion kits, and by June 3 the measure had been referred to the Assembly Committees on Environmental Quality and Transportation. California remains the only state where drivers cannot install those kits, leaving a federally approved option outside the state market even as E85 volumes keep rising.

E15 is moving, but slowly. California’s AB 30 became law in 2025, and CARB said in a March 5, 2026 FAQ that blends containing 10.5% to 15% ethanol that meet all applicable federal, state and local requirements may now be legally sold for transportation fuel in California. That followed the California Legislature’s unanimous Assembly approval of an E15 bill in October 2024, a Senate failure to act and Gov. Gavin Newsom’s direction to CARB to accelerate E15 sales.

Even with those gains, CARB’s 2025 LCFS Amendment Implementation FAQ shows the next barrier may be feedstock policy, with new sustainability requirements under subsection 95488.9(g). California already has the gallons and the retail footprint; the market’s next step depends on how fast regulators, retailers and vehicle technology can move in the same direction.