Mercedes Mullins
Texas is a big state, and its residents use a lot of fuel for transportation. In fact, Texas consumes more petroleum than any other state, and ranks third by volume in per capita petroleum use, after Louisiana and Alaska. Texans use about 13 billion gallons of gasoline and 4.5 billion gallons of diesel fuel each year, as well as smaller amounts of alternative fuels like compressed and liquefied natural gas, and biofuels. The transportation sector accounts for nearly two-fifths of the petroleum consumed in the state, and about one-fourth of the state's total energy consumption. Texas is also a major energy producer, providing about one-fourth of the country's domestically produced primary energy, and is the nation's largest net energy supplier.
| Characteristics | Values |
|---|---|
| Texas's rank in energy consumption | Second, after California |
| Texas's rank in energy production | First |
| Texas's rank in per capita petroleum use | Third, after Louisiana and Alaska |
| Texas's rank in gasoline tax rate | 26.3 cents per gallon in 2017 |
| Texas's rank in diesel tax rate | 64.0 cents in 2016 |
| Texas's consumption of gasoline | 13 billion gallons per year |
| Texas's consumption of diesel fuel | 4.5 billion gallons per year |
| Texas's consumption of alternative fuels | Smaller amounts of compressed and liquefied natural gas |
| Texas's consumption of finished motor gasoline | 134.55 billion gallons (in 2022) |
| Texas's consumption of finished aviation gasoline | 0.19 billion gallons (in 2022) |
| Texas's consumption of biodiesel | 175 million gallons per year |
| Texas's consumption of ethanol | 380 million gallons per year |
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What You'll Learn
Texas's fuel use for transportation compared to other states
Texas is the largest energy-consuming state in the US, accounting for about one-seventh of the nation's total energy use. It is also the largest consumer of motor gasoline, distillate fuel oil, and residual fuel oil. The transportation sector in Texas is the second-largest end-use energy user and accounts for about one-fourth of the state's energy consumption. In 2022, 42.6% of Texas's energy was generated by natural gas-fired power plants, while coal-fired power plants generated 16.6%.
Texas consumes more petroleum than any other state and ranks third in per capita petroleum use, after Louisiana and Alaska. The industrial sector in Texas, which includes hydrocarbon gas liquids (HGLs) used as feedstocks for the petrochemical industry, is the largest petroleum consumer in the state. The transportation sector accounts for nearly two-fifths of the petroleum consumed in Texas.
Texas has an extensive natural gas infrastructure, with nearly a quarter of US-proven dry natural gas reserves located in the state. In 2023, Texas accounted for more than one-fourth (27%) of the nation's natural gas gross withdrawals. The state has 17,000 miles of interstate natural gas pipelines, transporting natural gas across the US and into Mexico.
While Texas is a significant energy consumer, it is also the nation's largest net energy supplier, producing much more energy than it consumes. The state's energy mix includes both fossil fuels and renewable energy sources, with wind power generating about 25% of its energy in 2022. Texas also has the capacity to produce transportation biofuels, including sustainable aviation fuel and renewable diesel.
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The industrial sector's fuel use
Texas is the largest energy-consuming state in the US, accounting for about one-seventh of the nation's total energy use. The Texas industrial sector, which includes energy-intensive industries like chemical manufacturing, crude oil and natural gas extraction, and petroleum refining, is the state's largest energy consumer. It accounts for more than half of the state's total energy consumption and 24% of the nation's total industrial sector energy use.
The industrial sector in Texas consumes more petroleum than any other state, accounting for more than three-fifths of the state's petroleum use. Texas is the largest consumer of motor gasoline, distillate fuel oil (including diesel fuel for highway use), and residual fuel oil. The state's refineries are complex facilities that can process a wide range of crude oil types into high-value products, such as motor gasoline and diesel fuel. Texas's industrial sector, where hydrocarbon gas liquids (HGLs) are used as feedstocks for the petrochemical industry, is the largest consumer of HGLs in the nation, using more than all other states combined.
Natural gas is a dominant and growing source of energy in Texas, with the state consuming 15% of the US electric power sector's total natural gas consumption, the highest of any state. Natural gas is used extensively in the chemical manufacturing sector, acting as an inexpensive feedstock to lower energy costs. Employment in the natural gas industry is significant in Texas, providing thousands of jobs in drilling, fuel production, and electric power generation.
The energy industry is a major economic driver in Texas, supporting thousands of direct and indirect jobs in various fields, including mining, quarrying, and oil and gas extraction. Texas's ability to produce much more energy than it consumes makes it the nation's largest net energy supplier.
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Taxes on fuel
Texas is a large state, and its residents use a lot of fuel for transportation. Texans use about 13 billion gallons of gasoline and 4.5 billion gallons of diesel fuel each year, as well as smaller amounts of alternative fuels such as compressed and liquefied natural gas. In 2012, only eight nations used more gasoline and diesel than Texas.
Motor fuel taxes are an important source of revenue for the federal and state governments. Texas motor fuels taxes generated more than $3.4 billion in fiscal 2015, making them the fourth-largest source of state tax revenue. Nearly all states, including Texas, use the bulk of this revenue for transportation projects. Under the Texas Constitution, after refunds and collection costs are subtracted, three-quarters of the state’s motor fuel tax revenue is used to build and maintain public roadways. The remainder goes to the state’s Available School Fund, which supports public education.
Texas's tax rates on gasoline and diesel have been stable in recent years, remaining at 20 cents per gallon since 1991. This followed a period of sharp increases in the late 1980s, when gas tax rates rose from 5 cents per gallon in 1984 to 20 cents in 1991. Diesel rates more than tripled in the same period, from 6.5 cents to 20 cents per gallon.
Texas does not add additional taxes, fees, or charges to the main tax, unlike many other states. However, the purchasing power of the state’s gasoline tax has decreased over time due to inflation. In 2014, the actual purchasing power of the state’s gasoline tax was 6.8 cents, down from 20 cents per gallon in 1991.
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Texas's fuel production
Texas is the top energy-producing and energy-consuming state in the US. It produces about one-fourth of the country's domestically-produced primary energy, and accounts for about one-seventh of the nation's total energy use. Texas is also the largest net energy supplier in the country, as it produces much more energy than it consumes.
Texas has one-fourth of the nation's operable crude oil refineries and about one-third of the total US refining capacity. The state's 34 petroleum refineries can process a combined total of nearly 6.3 million barrels of crude oil per calendar day. The largest US refinery is in Galveston Bay, Texas, and it alone can process about 631,000 barrels of crude oil per calendar day. Many of the Texas refineries are complex facilities that can process a wide variety of crude oil types into high-value products, such as motor gasoline and diesel fuel, and into feedstocks for the chemical industry.
Texas also has abundant renewable energy resources and is first in the nation in wind-generated electricity. With a significant number of sunny days, Texas is among the leading states in solar energy potential and generation. Geothermal resources suitable for power generation are also found in eastern and southern Texas.
Texas has three fuel ethanol plants that can produce a combined total of about 380 million gallons of ethanol annually. However, the state's ethanol production in 2022 was 354 million gallons. Texans consume four times more fuel ethanol than the state's plants can produce, and additional supplies come from out of state. Texas also has four biodiesel plants that can produce about 175 million gallons of biodiesel each year. A new refinery in Newton County, Texas, will process one million tons of wood waste into a variety of transportation biofuels, including sustainable aviation fuel and renewable diesel.
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Alternative fuels
Texas, the largest energy-consuming state in the US, uses about 13 billion gallons of gasoline and 4.5 billion gallons of diesel fuel each year. The state also consumes smaller amounts of alternative fuels such as compressed and liquefied natural gas, biodiesel, and ethanol.
Texas's industrial sector, which includes energy-intensive industries such as chemical manufacturing, crude oil and natural gas extraction, and petroleum refining, is the state's largest energy consumer. The transportation sector is the second-largest end-use energy user in Texas, accounting for about one-fourth of the state's energy consumption.
With concerns about the longevity of fossil fuels and the impact of the transportation industry on the environment, the search for alternative fuels is intensifying. Here are some alternative fuels that could help reduce the reliance on gasoline and diesel:
Hydrogen
Hydrogen is a potentially emissions-free alternative fuel that can be produced from renewable resources. Hydrogen fuel cell vehicles use hydrogen and oxygen to produce electricity, offering a more environmentally friendly option than traditional gasoline-powered vehicles. However, the high cost of fuel cells and the limited availability of hydrogen fuelling stations are challenges to its widespread adoption.
Natural Gas
Natural gas is a fossil fuel composed mostly of methane and can be produced domestically. It offers significant cost advantages over gasoline and diesel fuels and could reduce greenhouse gas emissions. However, the limited number of vehicles capable of using natural gas and the lack of fuelling stations are obstacles to its broader implementation in the transportation industry.
Propane
Propane is a widely used gaseous fuel that has been powering vehicles around the world for decades. It is readily available and can be easily integrated into the transportation industry.
Biodiesel
Biodiesel is a biomass-derived fuel that can be used in any diesel engine. It is non-toxic, biodegradable, and emits fewer harmful chemicals into the atmosphere. However, biodiesel is less powerful than regular diesel or gasoline and can present storage challenges due to its tendency to thicken over time.
Sustainable Aviation Fuel
Sustainable aviation fuel is derived from renewable feedstocks and enables a reduction in life cycle carbon dioxide emissions compared to conventional fuels. Texas is home to a refinery that will process wood waste into sustainable aviation fuel, contributing to the development of alternative fuels.
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Frequently asked questions
Texans use about 13 billion gallons of gasoline and 4.5 billion gallons of diesel fuel each year.
Texas consumes more petroleum than any other state and ranks third by volume in per capita petroleum use, after Louisiana and Alaska.
Motor gasoline is one of the most consumed fuels in the United States, and Texas is the largest consumer of motor gasoline.
Texas's motor fuel taxes generated over $3.4 billion in fiscal 2015, making them the fourth-largest source of state tax revenue.
The tax rate on gasoline and diesel fuel in Texas was 35 cents per gallon as of January 1, 2016.
