Sacramento, California —
In a special legislative session to discuss Gov. Gavin Newsom’s plan to avoid gas price spikes, many California legislators will return to Sacramento on Wednesday to kick off a series of hearings.
According to Newsom’s administration, gas prices can surge in the event of unscheduled maintenance, power outages, or other similar situations; this proposal gives state authorities the authority to establish new regulations requiring oil refiners to keep a backup oil supply on hand.
Unscheduled maintenance at two refineries in the Bay Area has caused prices in Northern California to rise. On Friday, the Division of Petroleum Market Oversight in California cited the scenario as proof that the new regulations are necessary.
Fueling station and gas prices are on the rise in California, even if they are still falling nationwide.
However, oil companies have voiced concerns that the governor’s plan will lead to higher prices for gas consumers in states like California, Arizona, and Nevada, as well as refiners. In a recent interview with KCRA 3, Western States Petroleum Association President Catherine Reheis-Boy brought attention to the fact that California’s number of refineries has decreased from 43 to only nine in the past few decades.
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California, according to Reheis-Boyd, lacks the infrastructure necessary to transport the product swiftly and easily, including tanks and pipelines. She estimated that new tanks would be required by refiners and would cost around $35 million apiece.
“Even if you could find the land to permit them and build them, you’d have to completely ignore [the California Environmental Quality Act] and all the requirements because it would take a decade,” he added.
Three sessions will be held by an Assembly special committee to delve into the matter over the next week and a half. Cottie Petrie-Norris, a Democrat, is the chair of that committee.
“This is a chance for us to fully grasp this proposal and carefully evaluate it,” Petrie-Norris stated in a Monday interview. “We cannot expect California families to accept skyrocketing gas prices.”
According to Petrie-Norris, the agendas are still in the works as of Monday. However, she did mention that the hearing on Wednesday will mostly center around the current status of the petroleum market, while the hearing on Thursday will examine the advantages and disadvantages of the governor’s proposal.
Concerned about the potential impact on petrol costs in neighboring states, the governors of Nevada and Arizona wrote to Newsom, encouraging him to reconsider the proposal. According to Petrie-Norris, Arizona experts could be present at the proceedings. The committee’s analysis would take into account the concerns and interactions with stakeholders from out of state, she said.
“It’s so important for us to be mindful of those concerns and be mindful of any unintended consequences,” she said. “Our goal here really is to ensure we’re saving Californians money.”
In the special session, Republicans have put forth several bills aimed at lowering gas costs. These include one that would suspend the state’s gas tax and another that would prevent its increase in the future. The fact that Newsom has specifically requested a special legislative session to examine his idea makes it seem improbable that those will be approved, according to Petrie-Norris.
On Wednesday, the first hearing will begin at 1 p.m., and on Thursday, the second will begin at 10 a.m. After a hearing on Thursday, September 26, the committee will vote on the bill.
The governor’s plan will not be considered by the State Senate until they return to Sacramento. Senate Pro Tem Mike McGuire, who heads the upper house, has said the measure has Senate support but is waiting for the Assembly to act before calling a meeting.
