A bill backed by Gov. Gavin Newsom as part of a broader plan to end gas price hikes was given final approval by the California State Assembly in a special session Monday afternoon and now heads to the governor’s desk for his signature.
The bill allows the state to require oil refiners to maintain a minimum inventory of fuel to avoid supply shortages that create higher gasoline prices for consumers, and higher profits for the industry, Newsom said. It also authorizes the California Energy Commission, the state’s main energy policy agency, to adopt rules that require oil refiners to have surplus supplies before they go down for maintenance.
The measure was approved by the Assembly earlier this month with a 44-17 vote and by the Senate last Friday with a 23-9 vote. Monday’s 42-16 approval vote by the Assembly was procedural because the bill was amended in the Senate to include more provisions for worker safety.
Newsom released a statement Sunday saying that on Monday he will “stand alongside legislative partners and community leaders to announce legislative action on the proposal to help prevent gas price spikes and save Californians money at the pump.” The press conference is scheduled for 2 p.m. Monday.
The bill received pushback from Republican lawmakers, labor groups and the oil industry, which argued that it could unintentionally spike gas prices and threaten worker safety because delaying necessary maintenance could lead to accidents.
“Democrats know these new regulations will do nothing to actually lower gas prices,” said Assembly Republican James Gallagher of Yuba City in a statement. “Make no mistake, they have the power to lower gas prices today. But instead of passing any meaningful proposals, Democrats are doing the governor’s bidding. They should be fighting for California drivers, not helping Newsom distract from the price hike his administration is getting ready to impose.”
Gallagher said Assembly Republicans proposed several bills that would have immediately offered drivers relief at the pump, including a bill that would have suspended the gas tax and exempted gas from Cap-and-Trade. Democrats refused to vote on the bills and instead pushed forward with the governor’s “half-baked mandate,’’ he said.
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California drivers are currently paying the highest gas prices in the nation. In California, drivers were paying an average of $4.67 a gallon for regular gas Monday, according to AAA. The average price for a gallon of gas in the nation was $3.20, according to AAA.
Oil industry groups, such as the Western States Petroleum Association, have voiced stern opposition to the bill since it was unveiled in late August The association claims the refinery supply mandate will create artificial shortages of fuel in California, Arizona and Nevada by forcing refiners to withhold fuels from the market
“This theory of cost savings is just that — a theory,” association President Catherine Reheis-Boyd said in a statement. “Without a deep understanding of the complexities of refinery operations, policymakers are gambling with consumers’ wallets. We, as an industry, are ready to roll up our sleeves and address the root causes of California’s volatile energy market, which has been shaped by decades of policies.”
