California’s vitality market regulator is backing off a plan to position a revenue cap on oil refiners within the state.
Siva Gunda, vice chair of the California Vitality Fee, stated throughout a Friday briefing that the cap would “function a deterrent” to refiners boosting investments within the state. Gunda stated the fee desires to extend gasoline provide in California after two refineries introduced plans to shut within the subsequent yr, accounting for about one-fifth of the state’s crude-processing capability.
The advice marks a reversal from years of regulatory scrutiny by Governor Gavin Newsom and the California Vitality Fee that contributed to plans by Phillips 66 and Valero Vitality Corp. to close their refineries. The closings prompted Newsom to regulate course in April and urge the vitality regulator to collaborate with gas makers to make sure inexpensive and dependable provide.
- Advertisement -
Gunda wrote in a Friday letter to Newsom that the fee ought to pause implementation of a revenue margin cap and concentrate on gas resupply methods as a substitute. It comes greater than two years after Newsom and state lawmakers gave the vitality fee authority to find out a revenue margin on refiners and impose monetary penalties for violations.
The state will probably be seeking to improve gas imports to make up for the lack of refining capability, Gunda stated. Within the brief time period, California fuel costs may rise 15 to 30 cents a gallon due to the lack of manufacturing, he stated. A spokesperson for the vitality fee stated the estimated worth will increase could be mitigated by the plan introduced on Friday.
Californians already pay the very best gasoline costs within the nation.
Wade Crowfoot, secretary of the California Pure Assets Company, stated residents need the state to transition away from oil and fuel but they should stop price spikes. “We get it,” he stated. “We have to preserve affordability.”
Generated by readers, the feedback included herein don’t mirror the views and opinions of Rigzone. All feedback are topic to editorial overview. Off-topic, inappropriate or insulting feedback will probably be eliminated.
