Special legislation calls for special attention. Policy experts have closely studied Governor Gavin Newsom's proposal to impose a minimum supply mandate on refineries. The consequences are clear. The proposal, introduced as ABX2-1, would create artificial fuel shortages in California, Arizona, and Nevada by forcing refiners to withhold fuels from the market, driving up costs for consumers. That's why BizFed leaders voted last week to formally oppose the proposal.
Industry experts, the California Energy Commission, and economists all agree that ABX2-1 would cause significant harm. It comes at a time when energy affordability concerns are already a growing burden on everyday Californians. Our 2024 BizFed Pulse Poll results showed overall affordability and energy costs among your top concerns, ranking 4th and 7th, respectively, in this year's top business issues.
Legislators will have their first formal opportunity to vote on ABX2-1 during a committee hearing this Thursday, September 26. It's critically important to make your voice heard before Thursday.
🚨 ARTIFICIAL SHORTAGES -> HIGHER PRICES: ABX2-1 would require refiners to withhold gasoline to maintain inventory levels, which the California Energy Commission (CEC) has warned could create artificial fuel shortages. This disruption of the supply chain would likely lead to even higher gas prices.
🚨 ECONOMICALLY UNSUSTAINABLE: ABX2-1 seeks to be punitive – NOT collaborative. The penalties can reach up to $1 MILLION per day, making refining in California even more economically unviable.
🚨 COMPROMISED SAFETY: ABX2-1 prioritizes fuel supply over worker and community safety by delaying necessary maintenance. The bill requires CEC approval before crucial refinery turnarounds, potentially endangering workers and nearby residents by making safety a secondary concern.
🚨 LACK OF INDUSTRY INPUT: The creation of a politically appointed advisory committee with no industry or labor representation is troubling. This exclusion from the decision-making process, coupled with access to confidential business information, raises significant questions about transparency and expertise in refining policy.
