Latest news with #SB237
Forbes
02-07-2025
- Business
- Forbes
Lessening California's Energy Regulations Will Help Consumers
Expensive gasoline and fuel. Gas costs too much in the Golden State. Addressing this unaffordable energy problem should be a top priority for state legislators and the governor. California has taken a step backward toward this goal, however; but may be primed to take a step forward too. Stepping backward, the California Air Resources Board (CARB) increased the stringency of the state's low carbon fuel standards (LCFS). As of July 1, 2025, the new target reductions in the carbon intensity of transportation fuels are 30 percent below 2010 levels by 2030 and 90 percent below by 2045. The previous benchmarks were a 20 percent cut relative to 2010 by 2030, and an 85 percent cut by 2045. According to Cal-Matters, 'the previous fuel standard, which was set in 2011, added 9 cents to the cost of a gallon; a UC Davis researcher estimates that the new one could add 5 to 8 cents per gallon.' According to Politico, prices at the pump could increase by as much as 15 cents per gallon due to the more stringent standards. Piling more environmental program costs on Californians will surely worsen the state's affordability crisis. A bill currently under consideration in the legislature – SB 237 – presents an opportunity for the state to take one step forward. While the details are complex, this bill would cap the credit prices for the LCFS at around $75 to $76 per ton, which will help mitigate future price increases. The bill also encourages the state to replace its unique blending standard in favor of a unified western state standard and attempts to reduce the regulatory burden refiners must navigate when seeking environmental permits. If passed and faithfully implemented – a far from certain prospect – these reforms will help lessen the periodic supply constraints, and resulting price spikes, that too often afflict California. Unfortunately for cash-strapped Californians, SB 237 will not reduce gasoline prices from their currently inflated levels. As measured by the EIA, the average price for a gallon of regular gasoline in March 2025 was $4.49. For the U.S. overall, the average cost was a significantly lower $3.10 – Californians are spending around $1.39 more per gallon than the average American. The question perplexing Sacramento is, why? The answer is not difficult, simply inconvenient – it's the state's significantly more burdensome tax and regulatory policies. In an evaluation titled 'Why California usually pays more at the pump for gasoline' the EIA claims the higher costs are due to the state's taxes, fees, environmental programs, and its isolated petroleum market. In total, the study estimates that California's environmental programs add $0.54 to the price of a gallon of gas. Adding in the $0.90 in gasoline taxes and fees, state policies are adding $1.44 to the price of every gallon of gasoline. If all these costs were eliminated and replaced with the average state tax on gasoline – around $0.28 per gallon – then the price of a gallon of gasoline in California would have cost about $3.43 per gallon in March 2025. In other words, the costs in California would be around the U.S. average. As the figure below demonstrates, these excessive costs are not a short-term phenomenon. California's gasoline prices have been significantly more expensive than the national average for the entire 21st century. However, while they were around 12% more expensive between 2000 and 2015 on average, the price premium exploded beginning in 2015 as the state's cap and trade policy and LCFS became more stringent. For the first five months of 2025, California's costs have become 44% more expensive than the national average. California price premium These excessive costs harm families and businesses across the state. Looking just at the direct impact on families, the costs are not insignificant. Based on the average annual miles driven in California (11,409) and the average automobile MPG (24.9), the average Californian purchases around 458 gallons of gas annually. Due to California's $1.39 price premium, the average California driver must spend an additional $637 on gasoline. Across all 27 million drivers, the excess burden costs Californian families nearly $17.2 billion. Restoring a more affordable energy landscape in California requires a more realistic approach to the problem of global climate change. SB 237 is far from a panacea as it still maintains the complicated array of regulatory policies that have been driving up California's relative price of gasoline. Further, how the bill is implemented (if it is ultimately implemented) is also crucially important. However, SB 237 is a signal that more politicians in Sacramento may be beginning to recognize the causal link between high gas prices and policies such as the state's low carbon fuel mandates, cap and trade regulations, and high excise taxes. If this is the case, then SB 237 may mark the first step toward restoring the Golden State's broader energy affordability. For the sake of the many families struggling with California's unaffordable policies, let's hope so.
Politico
27-06-2025
- Business
- Politico
Breaking up with Big Oil is hard to do
IT'S COMPLICATED: California still wants to break up with Big Oil — but it needs a ride first. California Energy Commission Vice Chair Siva Gunda outlined his much-anticipated plan on Friday to keep gas prices from spiking as the state weans itself off of oil. TLDR: Support in-state crude oil production, boost imports of refined oil — and pause a profit cap on refineries passed by the Legislature and signed by Gov. Gavin Newsom in 2023. Newsom had already previewed the pivot when he asked Gunda to redouble efforts to keep in-state refineries operating profitably in April after two of them announced plans to close amid a long-term decline in demand. The recommendations on Friday not only mark a softening of the state's fight against the oil and gas industry, but also a recognition that attacks from Republicans on gas prices are sticking. 'The gist is, 'We get it,'' Natural Resources Secretary Wade Crowfoot told reporters Friday. California's climate officials are now on the tightest of political tightropes. For example, Gunda recommended the Legislature waive some environmental review rules to streamline further oil extraction from oilfields in Kern County — while also expanding limitations on new offshore oil and gas development and codifying a ban on well stimulation treatments. Meanwhile, the California Air Resources Board stuck by its hot-button emissions trading program for transportation fuels, announcing Friday that their changes to the low-carbon fuel standard will take effect early next week despite fears that tightening the restrictions on the carbon intensity of fuels could cause a spike in gas prices. Senate Democrats are already girding for a fight with the agency. They introduced a bill backed by Senate Pro Tem Mike McGuire on Tuesday to freeze credit prices that encourage the switch to electricity, hydrogen and other non-fossil fuels, cutting the legs out from under the program. For a deeper dive into the LCFS fight, read our exclusive Q&A with CARB Chair Liane Randolph below. — CvK, AN Did someone forward you this newsletter? Sign up here! CARB'S COUNTER: Randolph isn't taking Senate Democrats' attempt to weaken the LCFS quietly. The state's top air quality official pushed back against the bill, SB 237, in an interview Friday, saying the proposal 'is just irresponsible' after the Trump administration already revoked the state's power to enforce its electric car and heavy-duty truck mandates. POLITICO spoke with Randolph about the heated LCFS debate. Read the full interview on POLITICO Pro for her thoughts on California's climate disclosure law and what's next for discussions with automakers. This interview has been edited for length and clarity. What are you concerned about as the news of the LCFS changes taking effect becomes public, and what are you trying to get ahead of? It's super important to be proactive, to remind people about the importance of this program. It is designed to provide a cost-effective path to support the transition to lower-carbon fuels and to zero-ignition infrastructure that reduces greenhouse gas emissions, right? And so in all of this conversation about cost, I don't want people to forget about the incredible benefits of the program and the fact that it's generated $4 billion in annual private sector investment in the clean transportation sector. It attracts dollars. It attracts investment in the state. It delivers, under our estimate, $12 billion in health-related savings, and California businesses will see increased revenue of $6 to $8 billion from LCFS credit generation sales through the life of the program. It's really important to emphasize that this program has clear economic benefits. This news is coming against the backdrop of SB 237, a new bill that would weaken the LCFS program. Do you regret at all how the rulemaking was done and the initial estimate that LCFS would raise gas prices up to 47 cents? Has that put you in the crosshairs of lawmakers? The LCFS rulemaking was an incredibly robust process. There were multiple workshops, tons of stakeholder engagement, two public hearings in front of the board. So the idea that there was not a robust public discussion about all the pros and cons of all of the complexities of the program is just inaccurate. And we had multiple briefings with legislative staff, outreach from members that we responded to. So it was an absolutely robust public process. The second thing I'll say is that in this era, when the federal administration is literally taking away every tool that they can think of, the idea that we as a state would attempt to cripple programs that have been effective, that have resulted in economic development and better air quality, cleaner fuels, reduced greenhouse gas emissions, is just irresponsible. SB 237 is endorsed by Senate President Pro Tem Mike McGuire. How seriously do you take it, have you talked to the governor about this, and what could result from a proposal like this even if it doesn't move forward? It is a proposal that has the potential to set California back. And I think that it's really important for our elected leaders to be thinking about all the different aspects of how we achieve our air quality and climate goals, and to recognize that we as Californians really should control our own destiny as much as we possibly can. — AN SEE YA, CEQA: Newsom is asking lawmakers to approve an overhaul of one of California's landmark environmental laws before he signs off on this year's budget. A trailer bill introduced Friday carves out sweeping exemptions from the California Environmental Quality Act, which mandates environmental reviews of construction and has drawn the ire of pro-building and Republican voices accusing it of slowing down key projects. Under the bill, environmental review of housing projects would be limited, and many wildfire mitigation projects, including fuel breaks near homes and vegetation thinning near evacuation routes, would no longer need to be reviewed. Improvements to certain community water systems as well as some construction on the state's high-speed rail project would also be exempted. The exemptions got immediate praise from the California State Association of Counties on Friday. 'No longer will CEQA be leveraged to stall critical county wildfire, water and housing projects,' said CSAC President and Inyo County Supervisor Jeff Griffiths. They were panned, however, by environmental groups. 'The trailer bill 131 is the worst rollback of environmental and public health protections that we've seen in decades,' said Matthew Baker, the policy director at the Planning and Conservation League, in a press conference Friday. The bill is expected to be approved Monday in the statehouse and then signed into law by the governor. — CvK BYE BYE, LOCOMOTIVES: CARB officially repealed its rule to phase out diesel locomotives Thursday night. Board members voted unanimously to revoke the in-use locomotive rule, six months after the agency announced that it had withdrawn the emissions standard from consideration for an EPA waiver, once it became clear approval wouldn't happen before former President Joe Biden left office. The rule, approved in April 2023, was projected to reduce 386,300 tons of smog-forming nitrogen oxides by 2050, making it CARB's most impactful vehicle emissions standard. The loss compounds the blow from car and truck rules being axed, and means regions like Southern California and the Central Valley are all but guaranteed to be out of compliance and face the threat of federal sanctions. — AN BILLABLE HOURS: A Sacramento County Superior Court judge gave Attorney General Rob Bonta the green light late Thursday to keep his big climate lawsuit against oil and gas companies in the hands of an outside firm, Lesley Clark of POLITICO's E&E News reports. The decision to outsource the headline-grabbing lawsuit to the San Francisco law firm Lieff Cabraser Heimann & Bernstein got Bonta in a tussle with his own employees. Their union, the California Attorneys, Administrative Law Judges and Hearing Officers in State Employment sued over the decision, arguing in-house lawyers were capable of handling the complex work themselves. But Judge Shelleyanne Chang wrote in her preliminary ruling that there was not enough evidence of that and that hiring an outside firm was well within state law. As Lesley has previously reported, the state's contract with Lieff Cabraser Heimann & Bernstein lawyers shows its lawyers billing up to $1,241 an hour; lawyers with another outside firm, Sher Edling, hired to help with the work are making up to $625 an hour. — CvK — A California appeals court struck down one of the state's largest planned communities for not analyzing its greenhouse gas emissions impacts enough. — The San Diego region's water wholesaler approved a rate hike of 8 percent amid declining demand and high fixed costs. — Western states have had relatively cool temperatures this summer, but a national heat surge is coming.
Los Angeles Times
27-06-2025
- Automotive
- Los Angeles Times
California Democrats Push Reforms to Prevent Refinery Shutdowns
A group of California Democrats is looking to ease the state's gasoline standards and streamline permitting for refineries in a bid to prevent more fuelmakers from shutting down and raising costs for the state's drivers. A bill introduced by seven of the state's Democratic senators would require the energy commission to transition by 2027 to a less-stringent gasoline specification that's in line with other western states, replacing California's unique Carbob fuel. Nearer term, the measure would suspend rules requiring more environmentally friendly, but more expensive, fuel to be sold in the warmer months. The bill marks a reversal from years of regulatory scrutiny by Governor Gavin Newsom and the California Energy Commission that contributed to plans by Phillips 66 and Valero Energy Corp. to shut refineries that account for about one-fifth of the state's crude-processing capacity. The shutdowns prompted Newsom to adjust course in April and urge the state's energy regulator to collaborate with fuel makers to ensure affordable and reliable supply. 'Details of the policy are up for negotiation, but I will be fighting to ensure that we get needed change for Californians who are fed up with our fuel economy,' Senator Tim Grayson, one of the seven democrats who introduced the bill, said in an emailed statement. The limited number of refineries that can make California's artisan gasoline grade is one reason why the state's drivers pay more at the pump than the rest of the country. Among those were Phillips 66's Los Angeles refinery, which the company said in October that it would shut later this year, and Valero's San Francisco Bay Area plant, which the company said in April it is looking to close within a year. Bill SB 237 was introduced in January, passed the California Senate in May and is working its way through the state's assembly with a mid-September deadline of the current legislative session. If approved, it would pass to Newsom's desk to be signed into law. The bill would also establish a 'one-stop shop' for air, water and hazardous waste permitting for the state's refiners, who have long argued that a glacial permitting process and heavy regulation have raised costs and dissuaded companies from operating in the state. The bill's streamlined permitting process would be available to refiners only if they commit in a 'binding and enforceable agreement to continue to operate and to provide transportation fuels at an affordable price to consumers for the duration of the permits' issued through the process. To be sure, California's fuel makers are still making solid profits. The latest data from the California Energy Commission shows refiners made $1 a gallon gross margin in April, down from 2024 but well above the US average. Risser writes for Bloomberg.
Mint
27-06-2025
- Automotive
- Mint
California Democrats Push Reforms to Prevent Refinery Shutdowns
(Bloomberg) -- A group of California Democrats is looking to ease the state's gasoline standards and streamline permitting for refineries in a bid to prevent more fuelmakers from shutting down and raising costs for the state's drivers. A bill introduced by seven of the state's Democratic senators would require the energy commission to transition by 2027 to a less-stringent gasoline specification that's in line with other western states, replacing California's unique Carbob fuel. Nearer term, the measure would suspend rules requiring more environmentally friendly, but more expensive, fuel to be sold in the warmer months. The bill marks a reversal from years of regulatory scrutiny by Governor Gavin Newsom and the California Energy Commission that contributed to plans by Phillips 66 and Valero Energy Corp. to shut refineries that account for about one-fifth of the state's crude-processing capacity. The shutdowns prompted Newsom to adjust course in April and urge the state's energy regulator to collaborate with fuel makers to ensure affordable and reliable supply. 'Details of the policy are up for negotiation, but I will be fighting to ensure that we get needed change for Californians who are fed up with our fuel economy,' Senator Tim Grayson, one of the seven democrats who introduced the bill, said in an emailed statement. The limited number of refineries that can make California's artisan gasoline grade is one reason why the state's drivers pay more at the pump than the rest of the country. Among those were Phillips 66's Los Angeles refinery, which the company said in October that it would shut later this year, and Valero's San Francisco Bay Area plant, which the company said in April it is looking to close within a year. Bill SB 237 was introduced in January, passed the California Senate in May and is working its way through the state's assembly with a mid-September deadline of the current legislative session. If approved, it would pass to Newsom's desk to be signed into law. The bill would also establish a 'one-stop shop' for air, water and hazardous waste permitting for the state's refiners, who have long argued that a glacial permitting process and heavy regulation have raised costs and dissuaded companies from operating in the state. The bill's streamlined permitting process would be available to refiners only if they commit in a 'binding and enforceable agreement to continue to operate and to provide transportation fuels at an affordable price to consumers for the duration of the permits' issued through the process. To be sure, California's fuel makers are still making solid profits. The latest data from the California Energy Commission shows refiners made $1 a gallon gross margin in April, down from 2024 but well above the US average. More stories like this are available on
Politico
25-06-2025
- Business
- Politico
California's signature climate policies face a new foe: Democrats
SACRAMENTO, California — President Donald Trump is threatening California's marquee carbon-trading program. But it's in-state Democrats who are taking aim at the state's other emissions market for transportation fuels. Credit prices in California's low-carbon fuels market dropped $4 per ton Tuesday morning on the recognition of a credible threat in SB 237, a bill introduced overnight that would cap prices instead of letting them rise as planned in service of encouraging refiners to sell more biofuels, electricity and other non-fossil fuels. This isn't some potshot from marginalized Republicans — it's a bill from seven Democratic senators during the thick of the state's legislative session, blessed by Senate President Pro Tem Mike McGuire. 'This critical legislation will reduce costs for drivers across the Golden State while continuing to move our climate and energy goals full steam ahead,' McGuire said in a statement. And it's not all moderate Democrats, either — besides Sens. Tim Grayson, Anna Caballero and Melissa Hurtado, Sen. Jesse Arreguín, a former Berkeley mayor, is signed on, as is Sen. Jerry McNerney, a freshman and eight-term U.S. House member who was known for being Congress' 'science guy.' The bill is a grab bag of measures to address gas prices, along the lines of another sprawling affordability bill this session, Sen. Josh Becker's SB 254. In addition to capping credit prices at roughly $75 per ton, with increases pegged to inflation, it would also push state officials to ditch California's unique, lower-emission gasoline blend in favor of a broader, West-wide standard. It would also offer refiners a 'one-stop shop' for environmental permitting and impose more state oversight of any future rules that affect retail fuel prices. It's already triggering some odd-bedfellows alliances. The petroleum industry's main trade group, the Western States Petroleum Association, supports it — but so do environmental justice advocates who have long opposed the fuel market's incentives for dairy farms that capture their methane emissions and sell it for electricity. So does at least one sitting member of the state agency that put the policy in place. 'This isn't a surrender,' said Dean Florez, a member of the California Air Resources Board and a former state lawmaker from Bakersfield. 'It's a reality check. When credit prices spike so high they quietly tack 85 cents onto a gallon of gas, people stop believing that the green future includes them.' But other environmentalists are concerned about losing another climate policy in the state's toolbox, right after Trump revoked the state's permission to enforce its nation-leading electric vehicle targets. 'Why would we handcuff ourselves by not using a key policy to address transportation, the single largest emitting sector in California?' asked Katelyn Roedner Sutter, California director for the Environmental Defense Fund. For Gov. Gavin Newsom — who's beat up on oil companies but then instructed his California Energy Commission to try to keep refiners from leaving after two of them subsequently announced departure plans — the bill could cut both ways. (Newsom's office didn't immediately respond to a request for comment.) It puts a spotlight on the state's perpetually high gas prices and reopens a wound from last year, when lawmakers hit CARB over its admission and subsequent walkback of its estimate that the program could raise gas prices by 47 cents per gallon. But it could also help close another wound from last year, when neighboring governors whose states depend on California gas publicly complained about Newsom's bill to have refiners keep more supplies on hand in the event of outages. There's surprisingly wide agreement that California's custom blend of gasoline, formulated to reduce smog in the summer, might not need to be so uniquely tailored. Dan Sperling, a former CARB board member and director of the University of California, Davis' Institute for Transportation Studies, said broadening the market to align with the fuel used in other Western states would bring down prices and reduce the impact of refinery closures, while having minimal impacts on emissions. 'If you can make some minor modifications and open up the market to more refiners outside California, then the concern about refiners leaving goes away,' he said. Grayson acknowledged things could change. 'Details of the policy are up for negotiation, but I will be fighting to ensure that we get needed change for Californians who are fed up with our fuel economy,' he said in a statement. But the mere fact of the bill is already juicing conversations about how it could interact with the ongoing negotiations to reauthorize the state's other carbon price, its cap-and-trade program. Environmental justice advocates are hoping it will count as a win for industry and moderate Democrats so they'll soften their opposition to proposed cap-and-trade changes like eliminating offsets. 'It's not really benefiting us and it is costing us, and we'd rather see that [price] go down than cap and trade go down,' said Katie Valenzuela, a consultant for environmental justice groups. Like this content? Consider signing up for POLITICO's California Climate newsletter.
