Latest news with #Phillips66
Time of India
21 minutes ago
- Business
- Time of India
California energy regulator recommends pause on plan to penalise excess oil profits
California should pause Gov. Gavin Newsom's plan to penalize oil companies if their profits climb too high, a top energy regulator said Friday while unveiling proposals aimed at addressing high gas prices. The Democratic governor signed a law in 2023 giving the California Energy Commission the authority to penalize oil companies for excess profits, declaring the state had "finally beat big oil." More than two years later, the commission hasn't imposed a single penalty or determined what counts as an excessive profit. Now, Siva Gunda, the energy commission's vice-chair, says the state should pause the effort in favor of pursuing other policies to lower prices and maintain a steady oil supply - all while pushing to phase out reliance on fossil fuels over the next two decades. "Together, we will evolve California's strategy to successfully phase out petroleum-based fuels by 2045 while protecting communities, workers, and consumers, and foster market conditions that support the industry's ability to operate safely, reliably, and successfully to meet demand through the transition," Gunda wrote in a letter to Newsom. Gunda's recommended pause of the penalty would have to be agreed upon by the full commission. Newsom has pitched the penalty as a way to rein in profits by oil companies, but critics said it would only raise prices. California has the highest gas prices in the nation, largely due to taxes and environmental regulations. Regular unleaded gas prices were $4.61 a gallon Friday, compared to a national average of $3.20, according to AAA. The commission still plans to set rules that would require oil refineries to keep a minimum level of fuel on hand to avoid shortages when refineries go offline for maintenance, Gunda said. That proposal came out of a law Newsom signed last year after convening a special session aimed at preventing gas price spikes. Gunda's recommendations come months after Newsom in April directed energy regulators to work with refiners on plans to ensure the state maintains a reliable fuel supply as it transitions away from fossil fuels. Newsom spokesperson Daniel Villasenor said in an email that the governor would review the recommendations and "advance solutions that maintain a safe, affordable, and reliable supply of transportation fuels for California." Two major oil companies announced plans over the past year to shut down refineries in the state, further driving uncertainty about how the state should maintain a stable fuel supply as California transitions toward renewable energy. Phillips 66 announced plans to shut down its Los Angeles-area refinery, and Valero said it would cease operations at its Benicia refinery. The two refineries combined account for more than 17% of the state's refining capacity, according to the energy commission. A group of about 50 environmental and consumer groups penned a letter to Newsom and legislative leaders Friday criticizing the proposal to pause implementing a penalty on oil company profits. "California oil refiners do not need a bailout," they wrote, adding that the state should "finish the job" it started to prevent prices at the pump from spiking.
5 hours ago
- Business
California energy regulator recommends pause on plan to penalize excess oil profits
SACRAMENTO, Calif. -- California should pause Gov. Gavin Newsom's plan to penalize oil companies if their profits climb too high, a top energy regulator said Friday while unveiling proposals aimed at addressing high gas prices. The Democratic governor signed a law in 2023 giving the California Energy Commission the authority to penalize oil companies for excess profits, declaring the state had 'finally beat big oil.' More than two years later, the commission hasn't imposed a single penalty or determined what counts as an excessive profit. Now, Siva Gunda, the energy commission's vice-chair, says the state should pause the effort in favor of pursuing other policies to lower prices and maintain a steady oil supply — all while pushing to phase out reliance on fossil fuels over the next two decades. 'Together, we will evolve California's strategy to successfully phase out petroleum-based fuels by 2045 while protecting communities, workers, and consumers, and foster market conditions that support the industry's ability to operate safely, reliably, and successfully to meet demand through the transition,' Gunda wrote in a letter to Newsom. Gunda's recommended pause of the penalty would have to be agreed upon by the full commission. Newsom has pitched the penalty as a way to rein in profits by oil companies, but critics said it would only raise prices. California has the highest gas prices in the nation, largely due to taxes and environmental regulations. Regular unleaded gas prices were $4.61 a gallon Friday, compared to a national average of $3.20, according to AAA. The commission still plans to set rules that would require oil refineries to keep a minimum level of fuel on hand to avoid shortages when refineries go offline for maintenance, Gunda said. That proposal came out of a law Newsom signed last year after convening a special session aimed at preventing gas price spikes. Gunda's recommendations come months after Newsom in April directed energy regulators to work with refiners on plans to ensure the state maintains a reliable fuel supply as it transitions away from fossil fuels. Newsom spokesperson Daniel Villaseñor said in an email that the governor would review the recommendations and 'advance solutions that maintain a safe, affordable, and reliable supply of transportation fuels for California.' Two major oil companies announced plans over the past year to shut down refineries in the state, further driving uncertainty about how the state should maintain a stable fuel supply as California transitions toward renewable energy. Phillips 66 announced plans to shut down its Los Angeles-area refinery, and Valero said it would cease operations at its Benicia refinery. The two refineries combined account for more than 17% of the state's refining capacity, according to the energy commission. A group of about 50 environmental and consumer groups penned a letter to Newsom and legislative leaders Friday criticizing the proposal to pause implementing a penalty on oil company profits. 'California oil refiners do not need a bailout,' they wrote, adding that the state should 'finish the job' it started to prevent prices at the pump from spiking. ___
Yahoo
7 hours ago
- Business
- Yahoo
California should raise fuel imports, pause margin cap, regulator says
By Shariq Khan NEW YORK (Reuters) -California's energy regulator on Friday recommended new rules to encourage more private investment in fuel imports and a pause on refiner profit limits, hoping to stop gasoline prices from skyrocketing in the state as it braces for the closure of two of its major refineries. The recommendations by the California Energy Commission came in response to a letter by Governor Gavin Newsom to suggest changes to the state's energy transition efforts by July 1. California faces higher fuel costs from planned refinery closures by Phillips 66 and Valero Energy. CEC Vice Chair Siva Gunda acknowledged that refinery closures could boost the fuel prices in California, already the highest in the U.S., but said the sticker shock would be temporary. The CEC estimates gasoline prices would rise 15 to 30 cents per gallon in the immediate aftermath of the refinery closures. Retail gasoline prices averaged $4.61 per gallon in California as of Friday, higher than the national average of $3.21, according to AAA data. The CEC is exploring ways to keep existing refineries operational, while raising capacity at third-party import terminals to bring in and distribute more gasoline and jet fuel, Gunda said. As part of those efforts, the CEC recommended a pause on a program that capped the maximum profit refiners can earn on gasoline sales in the state. It said additional analytical work is needed to ensure it works as intended to protect consumers. It said the pause should be for a "reasonable length of time" but did not specify how long that would be. The CEC also asked Newsom to take steps to stabilize crude oil production in the state. California's crude oil output has dropped steadily from a peak of over 1 million barrels per day in the mid-1980s, to less than 300,000 bpd last year, according to U.S. government data going back to 1981.
Reuters
12 hours ago
- Business
- Reuters
California should support fuel imports, find ways to retain refiners, regulator says
NEW YORK, June 27 (Reuters) - California's energy regulator on Friday issued recommendations to Governor Gavin Newsom to support timely fuel imports and explore ways to retain operations at existing refineries in the state. Newsom had earlier this year asked the California Energy Commission to recommend changes to the state's energy transition efforts, as it faces higher fuel costs from Phillips 66 and Valero's decision to shutter refineries supplying about 20% of the state's total fuel production capacity.
Los Angeles Times
14 hours ago
- 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.
