SO COMMITTEE ON ENERGY UTILITIES
AND COMMUNICATIONS WILL COME TO
ORDER. GOOD AFTERNOON AS WE
CONTINUE TO TAKE SOME OF THE
PRECAUTIONS TO MANAGE ONGOING
COVERT NINETEEN REST THE SENATE
CONTINUES TO WALK IN THE PUBLIC
AND HAS PROVIDED ACCESS TO BOTH
IN PERSON AND TELECONFERENCES TO
PATIENT FOR THIS PUBLIC UP FOR
PUBLIC COMMENT FOR INDIVIDUALS
WISHING TO PROVIDE PUBLIC
COMMENT VIA THE TELECONFERENCE
OR IS THE PARTICIPANT TOLL FREE
NUMBER AND ACCESS CODE IS POSTED
ON OUR COMMITTEE WEBSITE AND
WILL BE DISPLAYED ON THE SCREEN
AND I WILL ANNOUNCE IT NOW
TODAY'S PARTICIPATION NUMBER IS
ONE EIGHT SEVEN SEVEN.
468-163-8772 TWO SIX. EIGHT ONE
SIX THREE AND THE ACCESS CODE IS
. FOUR FOUR ZERO ZERO. FIVE NINE
FIVE THAT'S. FOUR FOUR ZERO ZERO
FIVE NINE FIVE I WILL MAINTAIN
DECORUM DURING THE HEARING HOUSE
CUSTOMARY. ANY INDIVIDUAL WHO IS
DISRUPTIVE MAY BE REMOVED FROM
THE REMOTE MEETING SERVICE ARE
HAVE THERE'S SERVICES
DISCONNECTED OR MUSIC. SOME OF
OUR SPEAKERS TODAY WILL BE
PARTICIPATING REMOTELY FOR
REMOTE PARTICIPANTS. PLEASE MUTE
YOUR PHONES OR COMPUTERS THIS
WILL GREATLY AID IN ELIMINATING
ANY ACOUSTIC FEEDBACK. AND I
ASKED EVERY TIME THAT YOU WISH
TO BE RECOGNIZED. THAT YOU USED
TO RAISE YOUR HAND FEATURE IN
THE PROGRAM. EACH TIME YOU ARE
RECOGNIZED TO SPEAK A POP UP
WINDOW WILL APPEAR AND ASK IF
YOU WOULD LIKE TO BE ON MUTE.
PLEASE SELECT ON MUTE BEFORE YOU
BEGIN SPEAKING HOW ARE I. T.
PERSONNEL WILL PUT YOU BACK ON
MUTE WHEN YOU DONE ONCE
RECOGNIZED TO SPEAK PLEASE MAKE
SURE YOU CAN BE SEEN. ON YOUR
SCREEN STATE YOUR NAME AND THEN
YOU ARE READY TO ADDRESS THE
COMMITTEE. FOR TODAY'S HEARING.
WE WILL BE HEARING ALL OF THE
PANELS OF WITNESSES ON THE
GENDER PRIOR TO TAKING ANY
PUBLIC COMMENT. ONCE WE HAVE
HEARD ALL OF OUR WITNESSES WE
WILL HAVE A PUBLIC COMMENT
PERIOD FOR THOSE WHO WISH TO
COMMENT ON THE TOPICS ON TODAY'S
AGENDA. TODAY'S HEARING IS THE
FIRST HEARING OF THE TWENTY
THREE TWENTY FOUR SENATE
COMMITTEE ON ENERGY UTILITIES
AND COMMUNICATIONS. AND WITH ME
AS SHE HERE. THIS IS ALSO THE
FIRST HEARING OF THE
EXTRAORDINARY SESSION CALLED BY
GOVERNOR NEWSOM. I WOULD ALSO
LIKE TO TAKE THIS OPPORTUNITY TO
INFORM THE PUBLIC ABOUT OUR
COMMITTEE HAS ANOTHER TO
INFORMATION HEARING SCHEDULED IN
THE COMING WEEKS. NEXT TO YOU
WILL HEAR THE ANNUAL UPDATE. TO
THE LEGISLATURE FROM THE
CALIFORNIA PUBLIC UTILITIES
COMMISSION WHICH WILL FOCUS ON
UTILITY BILL AFFORDABILITY
ANOTHER PRICING ISSUE THAT IS
AFFECTING HOUSEHOLDS BUDGETS
THROUGHOUT THE STATE. AND THE
FOLLOWING WEEK MARCH SEVENTH
WILL HAVE AN OVERSIGHT HEARING
ON THE STATE'S BROADBAND
INVESTMENTS AND WHETHER WE ARE
MAKING PROGRESS ON CONNECTING
THE UNSERVED. NOW LET'S RETURN
TO THE DAYS HEARING. GASOLINE IS
NOW NECESSARY FOR MUCH OF WHAT
WE DO IN OUR EVERYDAY LIVES. MY
GASOLINE PRICES CAN BE
SCRIBBLING FOR RESIDENTS
PARTICULARLY FOR CALIFORNIANS
LIMITED FOREIGN FIXED INCOME.
AND FOR THOSE WHO MUST COMMUTE
LONG DISTANCE DISTANCE TO GET TO
WORK **** WHOSE JOB
NECESSITATES. SUFFICIENT DRIVING
. SUSTAIN SKYROCKETING GASOLINE
PRICES CAN SEEP INTO EVERYDAY
ASPECTS OF THE ECONOMY DRIVING
UP PRICES FOR CONSUMER GOODS AND
SERVICES. CALIFORNIANS ARE NO
STRANGERS TO THE PRICE
VOLATILITY OF GASOLINE FUEL
MARKETS. IN NINETEEN IN NINETEEN
SEVENTY I SHOULD SAY. CRISIS
RESULTED IN LONG LINES AT
GASOLINE STATIONS SHORTAGES OF
GASOLINE AND HIGH PRICES IN
NINETEEN NINETY NINE HI GASOLINE
PRICES RESULTED IN THE END
ATTORNEY GENERAL BILL LOCKYER
INVESTIGATING INDUSTRY PRACTICES
RELEVANT. TO THE PRODUCTION
DISTRIBUTION AND PRICING OF
GASOLINE AND DIESEL FUELS. IN
TWENTY TWELVE A FIRE TO CHEVRON
RICHMOND REFINERY LEAD TO AN
OUTAGE THAT CONTRIBUTED TO A
HIGH GAS PRICES AS WELL. AND IN
FEBRUARY TWO THOUSAND AND
FIFTEEN. I AND MY DISTRICT AN
EXPLOSION OF AXAR IMPACTS ON
MOBILE- TORRANCE REFINERIES
AUDIT AND SHUT DOWN THE FACILITY
AND SUBSEQUENT SUDDEN INCREASES
IN CALIFORNIA FUEL PRICES.
UNFORTUNATELY PRICE VOLATILITY
VOLATILITY IN CALIFORNIA FUEL
MARKET IS NOT NEW. IN OCTOBER OF
LAST YEAR CALIFORNIANS
EXPERIENCE RECORD RETAIL
GASOLINE PRICES AT SIX DOLLARS
AND FORTY CENTS A GALLON. WHICH
BRINGS US HERE TODAY. THE CRUDE
OIL THAT IS USED TO MAKE
GASOLINE IS SOLD IN A GLOBAL
MARKET THAT DICTATES THE PRICE
PER BARREL AND CAN BE AFFECTED
BY GLOBAL EVENTS. SUCH AS
RUSSIA'S INVASION OF UKRAINE
CALIFORNIA HAS CHOSEN. TO PLACE
A GREATER PRIORITY ON AIR
QUALITY VINGT OTHER PARTS OF THE
WORLD AND WE REQUIRED THE USE OF
A SPECIAL REFORMULATED GASOLINE
PLANT THAT IS MORE EXPENSIVE TO
PRODUCE. IN ORDER TO REDUCE SMOG
FORMING EMISSIONS ESPECIALLY IN
THE SUMMER. AS WE WILL LEARN
TODAY. WE ARE BOTH SELF
SUFFICIENT. REFINING ENOUGH
GASOLINE TO SUPPLY OUR OWN NEEDS
AN ISOLATED MARKET WONDERFUL TO
OUTAGES ON OUR SYSTEM OR OTHER
DISRUPTIONS THAT CAN AFFECT
SUPPLY AND PRICING. STATE AND
LOCAL POLICIES WOMEN IN STATE
EXTRACTION REFINING AND STORAGE
CAPACITIES WHICH RESULTS IN MORE
PETROLEUM BEING IMPORTED TO MEET
OUR STATE DEMANDS FOR OVER FORTY
YEARS THE STATE HAS ATTEMPTED.
INVARIANT VARYING FORMS TO GET A
BETTER HANDLE. ON THE
COMPLICATIONS OF THE GASOLINE
MARKET. THERE'S BEEN A LOT OF
FINGER POINTING. AMONG
STAKEHOLDERS SOME SINISTER
REFINERIES RAISING PRICES OTHER
STATES TO RETAIL RETAILERS.
OTHERS ARE BLAMING THE STAGE
TAXES AND ENVIRONMENTAL POLICIES
I BELIEVE THAT ALL OF THE ABOVE
. GOVERNOR NEWSOM HAS CALLED A
SPECIAL SESSION OF THE
LEGISLATURE TO CONSIDER POLICIES
TO DETER EXIT ACCESS. EXCESSIVE
I SHOULD SAY PRICES BY ALL
COMPANIES BY PROPOSING TO IMPOSE
A FINANCIAL PENALTY ON ACCESS
MARGINS WITH ANY PENALTIES
COLLECTED TO BE RETURNED TO
CALIFORNIANS. TODAY IT IS AN
IMPORTANT OPPORTUNITY FOR
SENATORS AND THE PUBLIC TO HEAR
FROM THE NEW SIMIN MINISTRATION
ABOUT THE DETAILS OF THE
GOVERNOR'S PETROLEUM WINDFALL
PROFITS BUT ONLY PROPOSAL. IT IS
ALSO AN OPPORTUNITY FOR THE
LEGISLATORS TO ASK QUESTIONS TO
BETTER UNDERSTAND THIS
COMPLICATED AND GLOBAL REGIONAL
MARKET I WANT TO BE SURE THAT WE
HAVE THE NECESSARY DATA TO
UNDERSTAND THE FACTORS AFFECTING
GASOLINE PRICES SO THAT WE CAN
HAVE THE CONFIDENCE. THAT
SOLUTION WE ADOPT WILL BRING
ACTUAL RELIEF TO CALIFORNIANS AT
THE GAS PUMP. IN OUR PURSUIT
ADDRESS GASOLINE WE MUST ENSURE
THAT OUR ACTIONS WE TAKE FIRST
DOES NO HARM TO CONSUMERS. NOW
LET'S HEAR FROM OUR PRESENTERS
ON BEHALF OF THE NEW SIM AND
MINISTRATION. I WELCOME
CALIFORNIA ENERGY COMMISSIONER
VICE CHAIR COMMISSIONER SIX SIVA
BOONDOCK. AND DIRECTOR OF THE
CALIFORNIA DEPARTMENT OF TAX AND
FINANCE FINANCE AGENCY NICOLAS
MADURO'S. THE REST. THANK YOU.
BE SURE WHEN YOU READY YOU MAY
BEGIN. TO CHECK IN THAT YOU CAN
CREATE. GOOD AFTERNOON CHAIR AND
MEMBERS OF THE COMMITTEE I'M
SICKENED BY SHARE PUBLIC ENERGY
COMMISSION AND I'M HERE WITH MY
COLLEAGUE NICK MADURO'S FROM
CALIFORNIA DEPARTMENT OF TAX AND
FEE ADMINISTRATION. THANK YOU
FOR HOLDING THIS IMPORTANT
INFORMATIONAL HEARING AND FOR
THE OPPORTUNITY FOR US TO BE
HERE AND PROVIDE YOU WITH THE
DETAILS OF THE GOVERNOR'S PRICE
GOUGING PENALTY PROPOSAL. PART
TWO DEPARTMENTS HAVE CRITICAL
ROLES IN THE GOVERNOR'S PROPOSAL
AND TO TODAY WE HOPE TO PROVIDE
YOU WITH DETAILS ON WATER
AGENCIES TO. I'M THE RATIONALE
BEHIND THE GOVERNOR'S PROPOSAL
AND ITS DETAILS. NEXT SLIDE. TO
I'M NOT SURE THE SITES ARE BEING
ACQUIRED. OUR SLIDES QUEUED UP.
YEAH. SO WOULD YOU LIKE US TO
KEEP GOING. CONTINUE MEMBERS OF
THE ANSWER SIX THANK YOU. START
TO AGENCIES CURRENTLY HAVE A
NUMBER OF RULES RELATING TO THE
PETROLEUM INDUSTRY. AS THE
STATE'S LEAD AGENCY FOR ENERGY
INFORMATION THE CDC GATHERS DATA
AND PROVIDES ANALYSIS RELATED TO
HISTORICAL GASOLINE MARKET. DATA
COMES FROM VARIOUS SOURCES AND
AT DIFFERENT REPORTING CADENCES
AND OFTEN NOT IN DEAL TIME AND
ARE NOT EVEN CLOSE TO REAL TIME.
CC DATA SUPPORTS THAT MERCHANTS
HE TO SPONSORS RELATED TO FUELS
IN COORDINATION WITH THE OFFICE
OF EMERGENCY SERVICES TO HELP
ENSURE AN ADEQUATE SUPPLY OF
TRANSPORTATION FUELS FOR FIRST
RESPONDERS AND OTHER CRITICAL
NEEDS. PERIODICALLY THE CDC
CONDUCTS IN DEPTH EXAMINATION OF
SIGNIFICANT GASOLINE PRICE
SPIKES AND PUBLISHES
OBSERVATIONS AND RECOMMENDATIONS
. ASSEMBLY TO SEE SEES
INITIATING A TRANSPORTATION FUEL
TRANSITION STUDY TO FURTHER
ASSIST THE MARKET AND PLAN FOR
TRANSITION AWAY FROM THE
PETROLEUM WHILE ENSURING
ADEQUATE SUPPLY AND MITIGATING
PRICE SPIKES. I PASS IT ON TO MY
COLLEAGUE NICK MOTORIST
INTRODUCED HIMSELF AND HIS
AGENCIES WORK RELATING TO
PETROLEUM INDUSTRY THANK YOU
SEVEN THANK YOU MR CHAIRMAN
MEMBERS THE COMMITTEE MY NAME IS
NICK MAJERUS. I'M THE DIRECTOR
OF THE CALIFORNIA DEPARTMENT OF
TAX AND FEE ADMINISTRATION OR CD
TFA- WITH CD TFA ADMINISTERED
THIRTY NINE DIFFERENT TAX AND
FEE PROGRAMS FOR THE STATE OF
CALIFORNIA. IT CITIES AND
COUNTIES. AMONG THE PROGRAMS WE
ADMINISTER OR THE MOTOR VEHICLE
FUEL TAX COMMONLY KNOWN AS THE
GAS TAX. THE SALES AND USE TAX
WHICH APPLIES TO GASOLINE SALES
IN CALIFORNIA THE UNDERGROUND
STORAGE TANK MAINTENANCE FEE AND
THE OIL SPILL PREVENTION AND
ADMINISTRATION FEE. VIRTUALLY
ALL OF THE IT INDUSTRY
PARTICIPANTS ARE WITHIN THE
PURVIEW OF CD TFA ON THE TAX AND
FEE FRONT. IMPORTERS REFINERS
TERMINAL RACK OPERATOR'S
POSITION HOLDERS SUPPLIERS GAS
STATION OPERATORS ALL REGISTER
AND FILED WITH THE DEPARTMENT.
AND ADDRESS MORE OF HOW THAT
COMES INTO PLAY BUT LATER IN THE
PRESENTATION. THANK YOU TAKE- X.
LIGHT SELECTIVITY. BY THE HERE
SURE THE AVERAGE RETAIL GASOLINE
PRICES IN CALIFORNIA IN CLEAN
AND THE U. S. IN BLUE. A FEW
ELEMENTS TO HIGHLIGHT HERE THAT
SENATOR BRADFORD QUALITY
CONVENTION. PRICES BOTH
NATIONALLY AND IN CALIFORNIA
TRACK VERY CLOSELY WITH THE PEAK
WITH THE PRICES OF CRUDE OIL
WHICH ARE GLOBALLY INDEXED. AS
THE GLOBAL CRUDE OIL PRICES RISE
AND FALL THE RETAIL PRICES
FOLLOW. GASOLINE PRICES IN
CALIFORNIA HAVE BEEN HIGHER ON
AVERAGE THAN THE REST OF THE
UNITED STATES FOR A FEW REASONS
INCLUDING ENVIRONMENTAL PROGRAMS
SUCH AS THE UNIQUE FUEL BLEND
VIEWS IN CALIFORNIA TODAY. BUT
THE TWO PRICES TRACKED CLOSELY
IN HOW THEY MOVE UP AND DOWN.
WELL HISTORICALLY THE DIFFERENCE
BETWEEN CALIFORNIA AND U. S.
GASOLINE PRICES WERE STABLE
SINCE TORRANCE REFINERY INCIDENT
IN TWENTY FIFTEEN. THE DATA
SUGGEST TWO PHENOMENA ONE THE
DIFFERENCE BETWEEN THE
CALIFORNIA AND U. S. PRICES
BEGIN TO GROW. AND TO THERE ARE
TIMES OF PRICE SPIKES IN
CALIFORNIA THE DIVERGE FROM
NATIONAL TREND SIGNIFICANTLY. WE
HIGHLIGHT THREE SPIKES ON THIS
CHART IN TWENTY FIFTEEN WE HAD
PRICE SPIKE FOLLOWING THE
TORRANCE REFINERY INCIDENT. THE
SECOND HIGHLIGHTED IN TWENTY
NINETEEN RESULTED IN GOVERNU
SOME ASKING THE ENERGY
COMMISSION TO DOUBLE UP THE
REPORT AND RESPOND TO THE
EXPERTS FREEZING THE CONCERNS OF
MYSTERY SURCHARGE. THIS LED TO
THE CC DOUBLE DIPPING A
METHODOLOGY AT LOOKING AT THE
PRICES BUT TO PUT FOCUSED IN THE
BALLOT OFFICE RETAIL MARGINS AND
LONGER ON GASOLINE PRICES SHOES.
THE ENERGY COMMISSION FOUND THAT
THE RETAIL MARGINS FOR NAME
BRAND RETAIL OUTLETS WERE MUCH
HIGHER THAN THE NON BRAND.
RETAIL OUTLETS AT THE TIME C. C.
DID NOT LOOK INTO THE SHARK ON.
I SAW THE PRICE SPIKES FINALLY
THE THIRD EXPLODED YOU SPIKE
HAPPENED LAST YEAR WHICH WE WILL
DELVE INTO MORE IN THE NEXT FEW
SLIDES SLIDE NUMBER FOUR. NO
TAKING A CLOSER LOOK AT JUST THE
DIFFERENCE BETWEEN CALIFORNIA
AND THE U. S. RETAIL PRICES THE
LINE AND RED IS THE DAILY
DIFFERENCE AND THE BLUE STEP
CURVE. IN THE ANNUAL AFTER IS
THE ANNUAL AVERAGE FOR A
SPECIFIC YEAR. AS NOTED BEFORE
THE ANNUAL DIFFERENCE CONTINUES
TO GROW. IN TWO THOUSAND
FOURTEEN THE DIFFERENCE WAS
FORTY CENTS AND IN TWENTY TWENTY
ONE IT GREW TO A DOLLAR FOURTEEN
CENTS. ON OCTOBER FOURTH TWENTY
TWENTY TWO WITH EACH AN ALL TIME
HIGH DIFFERENCE OF TWO DOLLARS
SIXTY ONE CENTS MUCH OF WHICH
WAS DRIVEN BY DEFINING THE
MARGINS AS WELL AS WE WILL SHOW
YOU SHORTLY. GIVEN THE
RECURRENCE OF THE SPIKES AND
EXTRAORDINARY HIGH LEVELS IS A
CONCERN AND WE PRESENT TO YOU IN
THE NEXT SLIDE A BREAKDOWN OF
THE CONTRIBUTING FACTORS. SIX
LIGHT PLEASE. HERE'S A BREAKDOWN
OF CALIFORNIA GASOLINE PRICES IN
TERMS OF COMPONENTS THAT WE CAN
DISCERN FROM THE DATA WE HAVE
ACCESS TO. JUST TO SET YOU ON
THE CHART THERE WE ARE LOOKING
AT THE CRUDE OIL PRICES AT THE
BOTTOM. NEXT COMES AT THE TAXES
AND FEES IN CALIFORNIA. AND THEN
THE ORANGE BAR WHICH IS THE
REFINERY COSTS AND PROFITS BUT
WHICH IS WHAT WE CALL. THE
REFINERY MARGIN AND ON THE TOP
IS THAT RETAIL MARGIN WHICH IS
THE DISTRIBUTION COSTS MARKETING
COSTS AND PROFITS. THIS
INFORMATION IS ALSO AVAILABLE ON
THE SEC WEBSITE CONSISTENT WITH
THE CCC APPROACH SINCE TWENTY
NINETEEN WILL BREAK THE RETAIL
PRICES IN TO FOUR KEY COMPONENTS
THAT ALIGN WITH THE STAGES OF
GASOLINE PRODUCTION. AS YOU CAN
SEE CRUDE OIL PRICES AND TAXES
AND FEES EXTRA. REMAIN FAIRLY
CONSTANT OVER THE TEN WEEK
PERIOD OF CONCERN. AND WE DON'T
BELIEVE CONTRIBUTED TO THE PRICE
SPIKES. IN FACT THE RETAIL
PRICES CONTINUE TO GROW AS THE
CRUDE OIL PRICES DECLINED
BETWEEN AUGUST AND OCTOBER. IN
ADDITION YOU SEE THAT IT FINALLY
MARGINS QUADRUPLE. AGAIN DOES AN
ORANGE GLOW FROM SIXTY FOUR
CENTS TO TWO DOLLARS FORTY EIGHT
CENTS. BETWEEN AUGUST TWENTY
NINTH OCTOBER THIRD. YOU CAN
ALSO SEE ABNORMALITIES IN THE IN
THE YELLOW SHADE OF LIGHT LIGHT
AND SHADE. OF THE DETAIL MARGINS
WHICH IS ALSO ADDRESSED BY THE
GOVERNOR'S PROPOSAL ON
TRANSPARENCY. AND MR MADURO'S
WILL FURTHER EXPAND ON IT
SHORTLY. NEXT SLIDE. THESE
INCREASES. IN FINALLY MARGINS AN
EXTRAORDINARY GASOLINE PRICES
AND ITS IMPACT ON CALIFORNIA
FAMILIES. VENN JUXTAPOSED WITH
THE RECORD GLOBAL PROFITS. ARE
ARE ESPECIALLY CONCERNING. WHILE
THESE PROFITS ARE GLOBAL OFTEN
DIRECTIONALLY CORRELATED TO THE
PROFITS IN THE WESTERN UNITED
STATES AND TO DATE WE HAVE NOT
RECEIVED ANY INFORMATION
DISAGREEING. THAT THE LAST FALL
WAS VERY PROFITABLE FOR THE
DEFINING INDUSTRY IN CALIFORNIA
. HEROES HAS BEEN IN THE NEWS
ARTICLE GLOBAL PROFITS ENJOYED
BY THESE REFINERIES CHEVRON
DOUBLED ITS PROFITS. MATT ON HAS
A 310031% INCREASE IN Q. FOUR.
THE LITTLE HAS ALMOST 9100%
INCREASE IN PROFITS PHILLIPS HAS
46% INCREASE. AND THE PPF HAS
SEEN 11100406% INCREASE OVER
TWENTY TWENTY ONE. NONE OF THEM
EXPERIENCED A FINANCIAL HARDSHIP
CORRELATED TO THE PERIOD
PRINCIPALLY WAS IMPACTED IN
CALIFORNIA. THE DATA SHOWS QUITE
THE OPPOSITE. THIS IS NOT TO SAY
THAT THE FINALLY SHOULD NOT BE
PROFITABLE OR EVEN ENJOY HEALTHY
PROFITS AS AN INDUSTRY. BUT TO
PROTECT CALIFORNIA CALIFORNIA
FAMILIES ALSO ESPECIALLY THOSE
THAT ARE VULNERABLE. NEXT SLIDE
. BEFORE WE INTRODUCE THE
COMPONENTS OF THE GOVERNOR
PROPOSAL A FEW CONTEXTUAL
SLIGHTS AS YOU CONTINUE TO
DELIBERATE ON THIS IMPORTANT
ISSUE AND TAKE INFORMATION.
CALIFORNIA REFINERY PRODUCTION
LEVEL- AND OWNERSHIP CONTINUES
TO EVOLVE. THIS IS AN OVERVIEW
OF CALIFORNIA'S PRODUCTION
CAPACITY FOR CONSUMER GASOLINE.
COMPARED TO THE START OF THE
CENTURY WHEN WE HAD ABOUT
FIFTEEN REFINERIES TODAY WE HAVE
ELEVEN. IN TOTAL N. 98% OF THE
GASOLINE DEFINING IS CONTROLLED
BY FIVE REFINERS. IT'S CHANGING
ECOSYSTEM COULD RESULT IN
OPPORTUNITIES FOR MARKET ACTORS
TO EXERT MARKET POWER. THIS HAS
NOT MATERIALLY CHANGED TWENTY
YEARS WHICH IS TO SAY THAT
DESPITE DEMAND STAYING HIGH AND
THE PRICE IS GOING UP NO NEW
ACTORS CAME INTO THE MARKET TO
DEFINE TO EXPAND DEFINING
CAPACITY OUR COMPETITION. NEXT
SLIDE PLEASE. TODAY'S
CALIFORNIA'S INSTEAD PRODUCTION
IS ENOUGH TO MEETING THE NEEDS
OF CALIFORNIA AND ALSO
SUPPORTING THE NEEDS OF THE
NEIGHBORING STATES. 88% OF THE
INSTANT PRODUCTION IS USED FOR
SERVING CALIFORNIANS. AND ABOUT
12% IS EXPORTED TO THE
NEIGHBORING STATES AND OTHER
DESTINATIONS WE A PIPE PLANTS
AND MARINE VESSELS. THANKS LIKE
. ANOTHER FACT THAT INFORMS
POLICY IN THIS AREA IS
DEMONSTRATED BY DECLINING DEMAND
. THE CDC IS STILL COLLECTING
TWENTY TWENTY TWO DATA. ANALYSIS
SHOWS THE DEMAND FOR GASOLINE
CONTINUES TO DECLINE FROM ITS
PEAK IN TWENTY SEVENTEEN. CECE'S
FORECASTING SUGGEST THAT
CALIFORNIA HAS LIKELY PASSED ITS
PEAK GASOLINE CONSUMPTION
LEVELS. CALIFORNIA GASOLINE
CONSUMPTION WAS DOWN 10% AND
TWENTY TWENTY ONE COMPARED TO
TWENTY NINETEEN. PRIMARILY
DRIVEN BY THE ELECTRIC VEHICLE
ADOPTION. INTELLECTS EXTEND THE
MORE TO WORK EXPANSION. NEARLY
24% OF ALL LIGHT DUTY VEHICLE
SALES IN Q. FOUR OF TWENTY
TWENTY TWO OR ZERO EMISSION
VEHICLES AND WE BELIEVE THAT
THIS WILL CONTINUE TO GROW. EVEN
WITH THESE DECLINING LEVELS
CALIFORNIA'S SKILLED TOWARD
LARGEST CONSUMER OF OIL BEHIND
US AND CHINA. AND CONTINUES TO
BE A LARGE MARKET OPPORTUNITY
FOR INDUSTRY. SIX LIGHT. GIVEN
THE TRANSITION AND
TRANSPORTATION SECTOR IT IS
IMPORTANT THAT THE STATE TAKES
ACTION TO ENSURE THAT CALIFORNIA
CONSUMERS ARE PROTECTED. AS THE
MARKET IS NOT NECESSARILY
INCENTIVIZED TO DO SO. AS THE
STATE ENERGY DATA AGENCY WE GET
A LOT OF QUESTIONS FROM YOU FROM
THE ADMINISTRATION AND THE
PUBLIC TO ANSWER KEY QUESTIONS
OF INTEREST AN EXTRAORDINARY
EVENTS HAPPEN IN THE MARKET. AND
WE CURRENTLY DO NOT PROCESS THE
INFORMATION TO ANSWER ALL
QUESTIONS TO THE LEVELS THAT ARE
PASSED MIGHT MAKE PEOPLE OF
INTEREST. THERE IS LACK OF
COMPLETE TRANSPARENCY INTO HOW
DEFINING INDUSTRY OPERATES TODAY
ASSISI COLLECTS DATA FROM
REFINERS AND THROUGH THIRD PARTY
SOURCES BUT IT DOESN'T ANSWER
ALL THE QUESTIONS ON WHY PRICE
SPIKES OCCUR AND HOST SUPPLY
WILL BE AFFECTED BY VARIOUS
EVENTS. THE PRICE BREAK EVENS
THEMSELF NEED TO BE UNDERSTOOD
MORE INTIMIDATED BECAUSE THE
TRANSITION AWAY FROM GASOLINE
BASED TRANSPORTATION IS GOING TO
FURTHER DISRUPT THE MARKET. THAT
WE HAVE BEEN DEPENDENT ON FOUR
HUNDRED AND FIFTY YEARS. AS
NOTED THAT DECREASING
COMPETITION THE DEFINING SECTOR
IS NOT GOING TO GO AWAY THIS
LONG TERM STATIC CONDITION IT'S
SOMETHING A TRANSITION PLAN AND
LONG TERM SOLUTION HAS TO
CONSIDER. AND MARKET INCENTIVE
TO MITIGATE PRICE SPIKES DOES
NOT EXIST. CONVERSATIONS BUT THE
INDUSTRY I'M GOOD WITH BUT
STAKEHOLDERS DURING THE
WORKSHOPS AND OTHERS. SHOULD IT
BE AGREED THAT THE FUTURE PRICE
SPIKES WILL OCCUR AND DID NOT
DISAGREE THAT THE PROFITS THAT
BUT THE PRICE BREAK STATE RESULT
IN PROFITS LAST YEAR. AND THEY
HAVE NOT DEVELOPED A STRATEGY
THAT PROTECTS CONSUMERS AND IT
IT IS INCOME THE INCUMBENT UPON
THE STATE TO FIGURE OUT
INCENTIVES TO SUPPORT THIS
MARKET. NEXT SLIDE. THIS IS WHAT
WE KNOW. WE CALL THIS THE HARD
BE CHARGED. THE SLIDE SHOWS THE
LAST DECADE OF HISTORY OF
REFINERY MARGIN DATA. THE MARGIN
IS THE AMOUNT OF THE FINE EIGHTY
SEATS FOR ITS PRODUCTS MINUS THE
PRICE OF THE CRUDE OIL. IT'S NOT
THE PRICE CONSUMERS PAY IT'S A
PORTION OF THE WHOLESALE PRICE
REFINERIES RECEIVED AFTER
DEDUCTING THE PRICE OF CRUDE. ON
THE GRASS THE MARGIN IS SHOWN TO
CORRESPOND WITH YOU WELL. TO
PRICE SPIKES WE HAVE CORRELATED
TO DEFINE ANY OUTAGES. THE
TWENTY FIFTEEN TORRANCE LITITZ
PIKE IS HERE SHOWING REFINER
MARGIN WAS UP AS WELL AS THE
DEFINING SPIKES IN TWENTY
NINETEEN. TO TWENTY TWENTY TWO.
THE LATE TWENTY TWENTY TO SPIKE
IS QUITE CLEAR. THE SLIDE SHOWS
THAT WHILE THESE MARGINS SPIKES
EVENTS ARE NOT FREQUENT ROUGHLY
THREE IN THE LAST DECADE.
THEY'RE QUITE LARGE AND GENERATE
SIGNIFICANT REVENUE. IN THESE
PRICE AND MARGINS BIKE EVENTS
THE DATA DOES NOT IDENTIFY ANY
MARKET BASED INCENTIVE FOR
REFINERS TO. ASSIST INCREASING
THAT MARGINS EVEN IT IS FOR A
SHORT WHILE. NEXT LIKE. THE
GOVERNOR'S PROPOSAL ATTEMPTS TO
CREATE THE MISSING INCENTIVE TO
RESIST THE OPPORTUNITY TO
COLLECT SPIKED MARGINS WHENEVER
THEY CAN. THE BILL WOULD SET A
MAXIMUM MARGIN FOR REFINERS AND
IMPOSE A PRICE GOUGING PENALTY
ON MARGINS ABOUT A MAXIMUM BUT
THE PENALTY GETTING
PROGRESSIVELY LARGER. THE IDEA
IS TO SET A MAXIMUM THAT HELLO.
ALLOWS ORDINARY PRICE
FLUCTUATIONS BUT PREVENTS COOLEY
RUNAWAY MARGIN SPIKES. SO THERE
WOULD BE NO CAP. AT ALL A NORMAL
PROFITS. FOR EXAMPLE IF THE
MARGIN WERE TO SET UP AT NINETY
CENTS PER GALLON AS ILLUSTRATED
HERE. THE PENALTY WOULD START
THERE AND THEN INCREASE AT
HUNDRED HUNDRED AND TEN. CENTS
PER GALLON. ALL OF THE PENALTY
WOULD START ONLY AFTER REFINERS
HAVE BEEN ALLOWED TO BURN A
HEALTHY PROFIT ON EACH GALLON
SOLD. JUST NOT AN EXTREME MARGIN
OF THE SOCK WE SAW LAST OCTOBER
THAT HURTS CALIFORNIA FAMILIES.
THIS WOULD NEVER FORCED ANYONE
TO OPERATE AT A LOSS AND INDEED
THIS MAXIMUM MARGIN AND PENALTY
WOULD PROVIDE AN INCENTIVE TO
BOOST SUPPLY IN THE
CIRCUMSTANCES WHERE REFINERS
PROFIT MIGHT OTHERWISE BE
MAXIMIZED BY LOADING THAT
OUTPUT. TO CIRCUMSPECT TO
ARTIFICIALLY CREATE SCARCITY
INSTEAD OF CREATING SCARCITY TO
DRIVE UP PRICES AND PROFITS.
WILL BOOST SUPPLY TO EARN THEIR
NORMAL HEALTHY MARGIN ON MORE
GALLONS OF GAS. THE GOVERNOR'S
PROPOSAL ALSO GIVE CC DISCRETION
TO GRANT OF REFINERS REQUEST FOR
AN EXEMPTION. FROM MAXIMUM CUT
CLOSE GASOLINE REFINING MARGIN
UPON A SHOWING BY THE DEFINER
FOR REASONABLE COSTS AND SUBJECT
TO ALTERNATE MARGINS ARE OTHER
CONDITIONS. AS THE COMMISSION
MISSTEP. NEXT LIGHT. APART FROM
THE PENALTY THE GOVERNOR'S
PROPOSAL ALSO INCLUDES FOUR
ELEMENTS THAT WILL INCLUDE
TRANSPARENCY AND PLANNING.
INCLUDE REPORTING ASSESSMENTS
OVERSIGHT AND INVESTIGATION THAT
WILL EXPAND ON NEXT BEFORE NEXT
SLIDE PLEASE BEFORE THEY GO INTO
REPORTING. IT IS IMPORTANT TO
NOTE THAT CC UNDER EXISTING
AUTHORITY THE PILOT GRANTS
CURRENTLY COLLECT AND REPORTS IN
THE AGGREGATE INFORMATION ON
PETROLEUM SUPPLY. AN IMPORTANT
POINT IS THAT CC HAS EXPERIENCE
IN GATHERING PROCESSING AND
PROTECTING CONFIDENTIAL DATA.
AND TAKES EXTREME CARE IN
HANDLING IT. FURTHER THE
LEGISLATURE PASSED SB THIRTY
TWENTY TWENTY TWO THAT WAS
ELEMENT THAT WAS SIGNED INTO LAW
LAST FALL PROVIDE CC WITH
FURTHER INFORMATION THAT'LL
CONTINUE TO HELP DECONSTRUCT.
GASOLINE PRICING AND ANSWER KEY
QUESTIONS. NEXT SLIDE PLEASE.
THE GUY PROPOSAL IN. TO PROVIDE
MORE TRANSPARENCY INTO REFINERY
OPERATIONS. THE CDC WOULD
BENEFIT FROM GETTING ADDITIONAL
INFORMATION FROM REFINERS AND
HAVE BETTER INSIGHT ON. THE
FINER PROFANITY MAINTENANCE
INFORMATION INCLUDING
INFORMATION ON ON PLANNED
REFINERY OUTAGES. SPOT MARKET
TRANSACTIONS TO GIVE INSIGHT
INTO SUPPLY STRESSORS MARKETER
SPONSORS AND HELP PARTICIPANTS
ARE BEHAVING IN THE MARKET.
INVENTOR HOLDINGS BY TYPE OF
MARKET PARTICIPANT SO THAT WE
CAN SEE THAT THE FINEST
CONTRACTUAL SUPPLY OBLIGATIONS
ARE AND AS WELL AS TRADERS WHO
DO NOT HAVE SUPPLY OBLIGATIONS
BUT CAN SELL TO THOSE WHO DO.
ESPECIALLY AFTER UNPLANNED
OUTAGES OVER ALL THIS DATA WILL
GIVE CC INSIGHT INTO OBSERVING
BEHAVIOR SHOWING WHO IS ACTING.
TO DECREASE. UPWARD PRESSURE ON
PRICES AND WHO'S NOT. NEXT SLIDE
ASSESSMENT. LAST QUARTER AS I
MENTIONED NEARLY ONE IN FOUR
VEHICLES SOLD IN CALIFORNIA WAS
ITSELF JUST A DECADE OR SO AGO
IT WAS ABOUT ONE IN ONE THOUSAND
. SEE SEE FORECASTS CONTINUED
GROWTH IN THAT MARKET GASOLINE
DEMAND WILL CONTINUE TO GO DOWN
BUT IT WOULD REMAIN AN ESSENTIAL
COMMODITY FOR A TIME AND WE NEED
TO BE PREPARED. THE PROPOSAL
DIRECTS THE CDC TO CONDUCT
REGULAR ASSESSMENTS TO ENSURE
ADEQUATE AND RELIABLE AND
AFFORDABLE FUELS WIDE STATE
TRANSITIONS COMING FROM FOSSIL
FUELS. THE SECOND CHALLENGE IS
THE NEED FOR AN ASSESSMENT TO
FIND WAYS TO ENSURE SUPPLY AND
MITIGATE PRICE SPIKES WHILE THE
STATE TRANSITIONS TO A CLEAN
TRANSPORTATION FUTURE. SLIGHT
AND SLIDE PLEASE SORRY OVERSIGHT
. THE GOVERNOR'S PROPOSAL ALSO
CALLS FOR ESTABLISHING AN
INDEPENDENT ADVISORY COMMITTEE
FUEL MARKET EXPERTS. CONSUMERS
AND LABOR TO PROVIDE THE
GOVERNOR ADMINISTRATION THE
LEGISLATURE. INDEPENDENT
EVALUATION AND RECOMMENDATIONS.
A DEDICATED INDEPENDENT ADVISORY
COMMITTEE IS NEEDED TO
OBJECTIVELY AND WITH CLARITY AND
FORESIGHT PREDICT AND DEVELOP A
POLICY TO IMMEDIATE HARSH EVENTS
ALONG THE ROAD TO
DECARBONISATION THE
TRANSPORTATION SECTOR. BUT THAT
I'LL PASS IT ON TO MY COLLEAGUE
NICK. THANKS OF A- THANK YOU SIR
. SO THE GOVERNOR'S PROPOSAL
ALSO TASKS CD TFA TO WORK WITH
THE CALIFORNIA ENERGY COMMISSION
TO STUDY THE DISTRIBUTION AND
RETAIL SALE OF GASOLINE IN
CALIFORNIA. CURRENTLY THERE IS
VERY LITTLE VISIBILITY INTO
WHAT'S HAPPENING WITH PRICING
AND CONTRACTS BETWEEN THE RACK
WHICH IS WHERE- THE BIG-
GASOLINE TRUCKS THAT WE SEE ON
THE ROAD FILL UP. AND THE RETAIL
GAS STATIONS IN CALIFORNIA WE
HAVE INFORMATION REGARDING
GALLONS DISTRIBUTED BUT PRICING
AND CONTRACTUAL RELATIONSHIPS
REMAIN INCLUDE INCREDIBLY
OPAQUE. CDFA WITH ITS AUDIT
EXPERIENCE CAN ASSIST WITH
GETTING ACCESS TO DOCUMENTS AND
WITH MANPOWER. WE HAVE EXISTING
AUTHORITY TO EXAMINE BOOKS AND
RECORDS OF VIRTUALLY ALL OF THE
PARTICIPANTS AND INVOLVED IN
TODAY'S DISCUSSION. AND THE
GOVERNOR'S PROPOSAL MAKES CLEAR
THAT THAT IS. THE AUTHORITY
WOULD EXTEND FOR PURPOSES OF THE
STUDY AS GASOLINE PRICING HAS A
CLEAR CONNECTION ULTIMATELY TO
STATE TAX REVENUE. EDT ESSAYS
AUDITORS DATA ANALYSTS AND
COMPUTER AUDIT SPECIALIST CAN
ASSIST WITH MAKING SENSE OF
LARGE VOLUMES OF DATA TO HELP
GIVE A BETTER SENSE OF WHAT'S
HAPPENING BETWEEN THE TIME WHEN
THE GASOLINE IS LOADED ONTO THE
TRUCKS. AND WHEN IT'S PUMPED
INTO CONSUMERS GAS TANKS. AS WAS
SHOWN ON THE EARLIER SIDE IF IT
SHOWS UP AGAIN IF YOU. PUT THE
PAGE THERE IN YOUR DECK- THE
EXTREME FLUCTUATIONS IN MARGIN
EXISTS NOT ONLY AT THE REFINER
LEVEL RETAIL GASOLINE PRICING
ALSO EXHIBITED SOME UNUSUAL
BEHAVIOR LAST FALL. WHILE
COMMISSIONER GOING TO FOCUS ON
MARGINS FOR REFINERS RETAIL
MARGINS BALLOONS AS YOU CAN SEE
THERE IN THAT. THIRD- GRAPH. THE
BALLOONED EVEN AS- REFINER
MARGINS EVENTUALLY CAME BACK TO
EARTH SO EVEN WHEN THE PRICE OF
OIL DROPPED AND THE PRICE THE
RACK DROPPED PRICES AT THE PUMP
FOR CALIFORNIA CONSUMERS.
REMAINED EXTREMELY HIGH. IN THE
OIL AND GAS WORLD IN THE
PROBABLY HEAR THIS. THROUGHOUT
TODAY'S HEARING THERE'S A SAYING
FOR THIS BEHAVIOR THE GAS PRICES
GO UP LIKE A ROCKET. AND COME
DOWN LIKE A FEATHER. PEOPLE SAY
IT ALL THE TIME BUT NOBODY QUITE
KNOWS EXACTLY WHY THIS IS.
PRICES GO UP VERY QUICKLY
SOMETIMES DUE TO PRICE SPIKES IN
CRUDE OIL PRICES SOMETIMES DUE
TO REFINERY OUTAGES SOMETIMES
FOR MAINTENANCE AND SOMETIMES
FOR REASONS THAT NOBODY YET CAN
QUITE EXPLAIN. WE SEE THE PRICE
ON GAS STATION SIGN SKYROCKET
OVERNIGHT BUT ONCE THOSE SUPPLY
ISSUES ARE RESOLVED WE DON'T SEE
THE PRICES AT THE PUMP FALL
NEARLY AS QUICKLY AND INDEED IN
SOME CASES. AS WITH THE TWENTY
FIFTEEN TORRANCE REFINERY FIRE
SOMETHING TO PRICES HAVE NEVER
REALLY GONE BACK TO PRE OUTAGE
LEVELS. THE GOVERNOR'S PROPOSAL
AND THIS STUDY WOULD ATTEMPT TO
GET US BEYOND ANECDOTES IN
THEORY SO THAT WE CAN LOOK AT
HARD DATA AND PROVIDE REAL
ANSWERS. WE LOOK AT THE SUPPLY
CONTRACTS AND AT THE DAILY
PRICING BOTH AT THE SUPPLIER AND
THE RETAILER LEVELS TO GIVE YOU
ANOTHER CALIFORNIA POLICY MAKERS
A CLEAR WINDOW. INTO WHAT'S
HAPPENING. REFINERY OPERATORS
AND OTHERS ARE ALSO SUPPLIERS TO
GAS STATIONS OFTEN UNDER LONG
TERM CONTRACTS. WITH PRICES
ADJUSTED EVERY DAY IF YOU TURN
TO THE NEXT SLIDE. SOME PEOPLE
THINK THAT THE UNIQUE NATURE OF
THE CALIFORNIA DISTRIBUTION
SYSTEM MAY PLAY A ROLE YOU CAN
SEE FROM THIS SLIDE THAT THE SO
CALLED DEALER TANK WAGON SUPPLY
CONTRACTS. WHICH ARE TYPICALLY
LONG TERM WITH DELIVERY INCLUDED
IN THE PRICE. ARE MUCH MORE
PREVALENT IN CALIFORNIA THAN IN
THE REST OF THE NATION. DOES
THAT IMPACT PRICING AT THE PUMP.
OR DOES IT SIMPLY REFLECT A
DESIRE FOR GUARANTEED SUPPLYING
. WE HAVE SOME VISIBILITY INTO
RACK PRICING THROUGH DATA
SOURCES BUT WE HAVE NO CLEAR
VIEW INTO THE DEALER TANK WAGON
PRICING. AND CONTRACTUAL
RELATIONSHIPS WHICH AS YOU CAN
SEE HERE THIS IS THE RED SECTION
IN THE CALIFORNIA MARKET IT. IT
DIVERGE IS WILDLY FROM THE
NATIONAL MARKET. THE STUDY IS
INTENDED TO PROVIDE NEEDED
INFORMATION TO UNDERSTAND THE
MARKET TO PROTECT CONSUMERS AND
TO NAVIGATE THIS TRANSITION-
AWAY FROM GASOLINE. CLEARLY MANY
QUESTIONS REMAIN. BUT ALL OF
THESE QUESTIONS AND CONTENT
WE'RE ATTEMPTING TO FIND OUT OR
KNOW WHAT BOTH. THE GOVERNOR'S
PROPOSAL SEEKS TO GET THE DATA
IN A WAY THAT DOES PROVIDE
PROTECTION FOR TRADE SECRETS AND
CONFIDENTIALITY. AND WE'VE BEEN
ANALYZE THAT DATA SO THAT WE CAN
MOVE FORWARD FROM A COMMON SET
OF FACTS. TO HELP PROTECT
CALIFORNIA CONSUMERS. AND WITH
THAT WE'RE HAPPY ANSWER ANY
QUESTIONS MEMBERS OF THE
COMMITTEE MAY HAVE THANK YOU FOR
YOUR PRESENTATION AND IN THE
INTEREST OF TIME WE'RE GOING TO
AFFORD MEMBERS ONE QUESTION AND
A FOLLOW UP AND THEN I WILL MOVE
TO THE NEXT ROUND SO THERE'S ANY
MEMBER. AT THIS TIME HAVE A
QUESTION. LAST YEAR DALLAS.
THANK YOU. CHAIRMAN SO I'VE
I'VE- BEEN LOOKING YEAR GRAFTON-
THERE'S ACTUALLY IS DUPLICATED
THERE'S A TWO DOLLAR AND FORTY
EIGHT CENTS- I GUESS PROFIT IF
THAT'S- THIS IS LEASE RAVI
OBVIOUSLY YOU'RE- HERE. IT'S NOT
ALL PROFIT INCLUDES COST AND PER
CASE OKAY SO IT'S A BIG GAP IN
THERE YOU CAN SEE THAT IN
OCTOBER THIRD TWENTY TWENTY TWO
BUT YOU LOOK DOWN OF THAT IF YOU
GO TO THE NEXT PAGE WHEN YOU
WERE. TALKING ABOUT THE- THE
RED- I GUESS IT'S THE D. W. E.
D. T. W. ACCOUNT THAT'S A DEALER
TANK WAGON PRICE SO- SO I'M A
FARMER AND- AND- COMMODITIES ARE
TRADED ON. FUTURES REITZEL ARE
THESE FOLKS PROCURING THEY'RE-
THEY'RE BUYING THAT ON FUTURE SO
IF THERE'S SOME SORT OF A PLAY
IN THE MARKET. ON THAT CAN DROP
THE PRICE EVEN THOUGH THERE MAY
NOT BE A SHORTAGE THAT CAN STILL
CHANGE THE PRICE BECAUSE
THEY'RE- MAKING SURE THEY'RE
GETTING THEIR SUPPLIERS. THEIR
FUEL SO THEY PLAYED ON A I'M
ASSUMING. I WONDER WHAT WHY IS
IT DIFFERENT CALIFORNIA THAN IT
IS- THERE'S THAT TO CONSIDER
WHETHER IT BY BUYING FUTURES ON
THIS AND WILL THIS ISN'T THIS IS
THIS IS. THIS IS THE- HOW
RETAILERS GET THEIR FUEL RIGHT
SO ARE THEY GETTING IT FROM
INDEPENDENT DISTRIBUTORS. WHO
ARE BUYING IT AT THE RACK OR ARE
THEY GETTING IT FROM THE
REFINERS. AND OVER LONG TERM
CONTRACTS THAT- BASICALLY
OBLIGATE SOMEBODY TO BUY ONLY
FROM THAT- SUPPLIER FOR A PERIOD
OF TEN YEARS OR SO. SO THAT'S
THAT'S THE ISSUE THAT RICHARD
YOU'RE ABSOLUTELY RIGHT THAT
MANY OF THE PLAYERS IN THE
INDUSTRY. ARE HEDGING- INCLUDING
THE REFINERS WHO ARE- YOU KNOW
WE USING MANY OF THE SAME DATA
POINTS THAT- THE STATE'S
REQUIREMENTS S. B. THIRTEEN
TWENTY TWO- FROM LAST YEAR-
USING THOSE. THE SAME VOTE. TO
BE SAFE TO SAY THAT. IF YOU LOOK
AT THE NATIONAL WHERE THAT
STUDENT- THE RED IS VERY.
UNIFORMS ARE DIFFERENT THERE'S A
BIG GAP ON THE CALIFORNIA SIDE
WE HAVE SPECIAL PLANS AND THINGS
THAT IF THERE IF SO FOR EXAMPLE.
I USE THE ANALOGY OF AGRICULTURE
IF THERE'S A BIG STORM COMING
AND WE'RE GONNA SEE A FROST. AND
YOU'RE DELIVERING PEACHES AND
YOU MIGHT GET FROZE YOU'RE
BUYING UP THOSE FUTURES MAKE
SURE YOU DO YOUR CUSTOMER OF THE
RETAIL. PERSON HOUSE SPEECHES.
WHAT WOULD BE THE SAME IN
CALIFORNIA WHERE WE HAVE A
LIMITED AMOUNT OF THAT PRODUCT
AVAILABLE BECAUSE IT'S A
CALIFORNIA BLEND. THAT THOSE.
HOLD THOSE WHOLESALERS WHO ARE
SUPPLYING TO THE RETAIL. WOULD
BE. MAKING SURE THAT THEY HAVE
THEIR CUSTOMER ORDERS FILLED
WHICH WOULD DRIVE THE PRICE UP.
CORRECT ME SO THIS IS GOING TO
SEE THIS ISN'T A PRICING THIS IS
JUST BIRDS PERCENTAGE OF THE
MARKET THAT IS SUPPLIED BY THESE
VARIOUS- AVENUES. SO THE DEALER
TANK WAGON HERE IS ABOUT 40%
CALIFORNIA ABOUT 6% NATIONALLY I
THINK THAT'S THE- IT'S THIS
DOESN'T INVOLVE PRICING HERE-
BUT YOU ARE RIGHT THAT ONE OF
THE THEORIES AS- FOR THE
DIFFERENCE IS THAT BECAUSE WE
HAVE A LOT. OF BASICALLY CLOSED
MARKET WITH LIMITED SUPPLY THAT-
SOME OF THE END USERS WOULD
CHOOSE WOULD OPT MORE FOR THOSE
CONTRACTS BECAUSE THEY WOULD
HAVE A MORE OF A GUARANTEE OF
SUPPLY. FROM THEIR SUPPLIERS NOT
NECESSARILY ON THE FUTURES
MARKET I DON'T THINK IN THAT
SENSE BUT JUST HAPPENED. THE
SAME THOUGH BECAUSE YOU HAVE A
CLOSE MARKET AND YOU HAVE. TO
SUPPLY YOUR RETAILERS WITH THE
PRODUCT AND YOU WANT TO
GUARANTEE THAT PRODUCT IF YOU
THINK THERE'S GOING TO BE A
SHORTAGE YOU'RE- AUTOMATICALLY
GOING TO PROCURE. THAT PRODUCT
ON ON SOME SORT OF THE- THE-
TANKER OR OR- ALLOTMENT TO MAKE
SURE YOU GET THAT THAT'S WHY YOU
COULD SEE THOSE. I SPY IT'S IT
CERTAINLY IS THERE A LOT OF
THEORIES AROUND THIS AND I THINK
ONE OF THE THINGS THAT THE
GOVERNOR HAS MADE CLEAR AND I
THINK. COMMISSION GOING TO-
DISCUSSED. IS THAT. THERE ARE A
LOT OF ANECDOTES AND A LOT OF
THEORIES AND IT SEEMS LIKE THESE
ARE NOBLE QUESTIONS AND WITH
FORTY MILLION CALIFORNIANS AND
SO MANY. CONSUMERS TO PROTECT
THAT IT MAKES SENSE TO TRY TO
GET. REAL HARD FACTS- AS WE
WOULD FROM. OTHER ECONOMIC
SECTORS AND- SENATOR- JUST TO IF
I MAY CLARIFY ON THE TO BETWEEN
THE TWO SIDES THAT YOU JUST
MENTIONED. THE REFINERY MARGINS.
ON THE COLUMN CHART THAT YOU
SEE- COULD DO NOT INCLUDE. A
DEALER TANK WAGON SO YOU
RECOMMEND EXTRA ONE POINT OF IT
IS. THESE ARE ACTUALLY CRACK
PRICES AND THAT'S WHAT YOU'RE
CALCULATING. THE SECOND PATHWAY
THAT NICK TALKED ABOUT IS A
FURTHER CONCERN ON THE TOP OF
THAT WHICH WE WILL LOOK INTO
INVESTIGATING BASED ON THE
GOVERNOR'S PROPOSAL I WILL COME
BACK TO YOU WITH RECOMMENDATIONS
. I CAN REMEMBER. I THANK YOU
FOR BRADFORD AND I JUST WANT TO
SAY THANK YOU FOR TESTIFYING
HERE TODAY. THIS IS A TOUGH
SCENARIO BECAUSE IT WE SAW THE
OIL COMPANIES MAKE RECORD
PROFITS DURING THIS PERIOD WHILE
GAS PRICES WERE AT ALL TIME
HIGHS- THERE IS CLEARLY A BELIEF
OUT THERE ARE MANY PEOPLE THAT.
THE OIL COMPANIES WERE PROFITING
OFF THE BACKS OF CALIFORNIANS.
AT THE SAME TIME WE DON'T HAVE
REALLY HAVE A SMOKING GUN AS FAR
AS I CAN SEE THAT SHOWS
INTENTIONAL COLLUSION- THAT THIS
PROPOSAL MIGHT BE
COUNTERPRODUCTIVE THERE'S ONLY
FIFTEEN REFINERIES LEFT HERE IN
CALIFORNIA. BECAUSE THE CLEAN
BURNT BURNING UNIQUE CLEAN
BURNING FUEL STANDARDS THAT WE
HAVE- THEIR ARGUMENT ONE OF THE
ARGUMENTS THEY'VE MADE TO US
AND- I'M SURE THEY MADE TO MY
COLLEAGUES IT IS SAID- THIS
PARTICULAR PROPOSAL WOULD CAUSE
MORE REFINERIES TO LEAVE THE
STATE. THUS FURTHER DRIVING UP
THE PROBLEM OF- INCOMPLETE
DECREASE SUPPLY AND POTENTIAL
INCREASED COSTS SO WHEN YOU GET
A CHANCE TO RESPOND TO THAT
ARGUMENT- AND THEN ALSO ASK YOU
YOU WON THE PROPOSALS THAT WAS
REYES BECAUSE WE DO HAVE KIND OF
A UNIQUE MARKETS VERY THIN HERE
IN CALIFORNIA- IS. A STRATEGIC
RESERVE SOMETHING LIKE THE
FEDERAL GOVERNMENT HAS WHERE WE
ARE THE REQUIRE THE OIL
COMPANIES TO KEEP PRESERVE
THEMSELVES- SO WE DON'T HAVE THE
SPIKES AND SUPPLYING DEMAND.
THAT THEY ARE CLAIMING WAS
BEHIND THE PRICE SPIKES. WHY NOT
SOME EMPHASIS ON THE STRATEGIC
RESERVE WHICH WOULD BE A GOOD
PROPOSAL INDEPENDENT OF THE
WINDFALL PROFITS- PENALTY SO
JUST ONE OF THOSE TWO QUESTIONS
I JUST WANT TO GIVE ME A CHANCE
TO RESPOND TO. THANK YOU. SO. IF
I CAN TAKE THE FIRST QUESTION.
SO I KNOW THE- THE BEEN CONCERNS
RAISED. SOME INDUSTRY ALWAYS
WOULD WHENEVER- YOU KNOW. ANY
SORT OF PENALTY IS CONSIDERED
THAT IT'S GOING TO. YOU KNOW
CAUSE CALAMITY THE DESIGN OF THE
PENALTY IS- HE DELICATELY
DESIGNED TO MEET THE CALIFORNIA
CHALLENGE- WITH. AND ALLOW
COMPANIES- INDEED ENCOURAGE THEM
TO CONTINUE TO MAKE VERY HEALTHY
PROFITS IN THE STATE OF
CALIFORNIA IF YOU LOOK AT THE-
HEART BE CHARTED. I'M
COMMISSIONER GOING TO SHOW THE
SENIOR PACKET HERE IT WOULD HAVE
ONLY BEEN TRIGGERED THREE TIMES
OVER THE LAST DECADE- AND- ANY.
THERE IS ANY- IMPACT ON- PROFIT
IN THOSE OTHER TIMES IT WOULD
HAVE ZERO IMPACT ON SUPPLY AND
DEMAND ON THE PROFIT TO THE
MAXIMUM PROFIT- CURVE- THAT.
THEY WOULD FACE ALSO A COUPLE
OTHER BRIEF POINTS C. C. WOULD
HAVE THE ABILITY IF THERE WERE.
SOME ADVERSE REACTION TO ADJUST
THE MARGINS FOR- TO PROVIDE SOME
SORT OF ESCAPE VALVE IF- IF
THERE WERE OTHER- UNINTENDED
CONSEQUENCES THE TOOK PLACE AND
ALSO IF YOU IF ONE LOOKS AT THAT
ECONOMIC SO- AND IT'S SORT OF
HARD TO DO THIS WITHOUT A CHART
BUT- THERE THERE IS THIS PROFIT
MAXIMIZATION CURVE AND
TYPICALLY. IN A IN A TRULY
COMPETITIVE MARKET YOU WOULD
SEE- THE OUTPUT AT SORT OF
WHERE- PRICE HITS- MARGINAL
COST- FOR PROFIT ITS MARGINAL
COST. AND EITHER SO AND THEN IF
THERE WERE HUGE PROFITS TO BE
HAD THEN YOU WOULD EXPECT SUPPLY
TO INCREASE TO MEET THOSE- TO
MEET THAT NEW DEMAND TO MAKE
MORE MONEY THAT'S NOT REALLY
WHAT YOU SEE IF I'VE I'VE GOT
HERE DECADES WORTH OF- PRICING
DATA AND OUTPUT DATA FROM
CALIFORNIA REFINERS THAT'S NOT
REALLY WHAT YOU SEE. I'M SO
EITHER AND I KNOW INDUSTRY SAYS
THAT THEY'RE OPERATING AT
MAXIMUM OUTPUT ALREADY AND THAT
THAT MAY BE TRUE WITH THAT IT'S
REGISTERED THE MAXIMUM OUTPUT.
BUT THEY ALSO THEN OPERATED
MAXIMUM OUTPUT AT MUCH LOWER-
PRICING LEVELS ARE MUCH MORE
LOWER PROFIT LEVELS- WHICH
INDICATES THAT THAT YOU'RE NOT
NECESSARILY GETTING A BENEFIT.
FROM THE TWO DOLLARS AND SIXTY
CENTS FOR- MARGIN ANYMORE
BENEFIT IN TERMS OF SUPPLY THEN
YOU'D GET AT A DOLLAR- AND
THAT'S SORT OF WHAT THE DATA
SHOWS FOR. THERE IS SOME MARKET
POWER OUT THERE THEY'RE ONLY
FIVE PARTICIPANTS CONTROLLING
90% OF THE MARKET AND THERE IS
THE BILL THERE MAY BE THE
ABILITY TO RESTRICT OUTPUT. AND
IN IF THAT'S THE CASE THEN THE
PENALTY IS DESIGNED TO ACTUALLY.
INCENTIVIZE PROVIDE A FINANCIAL
INCENTIVE FOR THOSE REFINERS TO
INCREASE OUTPUT- WHERE THEY
OTHERWISE MIGHT NOT. ANYWAY AND
ON YOUR SECOND QUESTION I'LL
TURN IT OVER TO A CIVIL
REGARDING THE RESERVED- THANK
YOU NICK AND I JUST WANNA.
REITERATE THE POINT THAT- NICK
MENTIONED ABOUT THE TOOLS THAT
ARE GIVEN TO THE CALIFORNIA
COMMISSION IN THE IN THE
PROPOSED- AND THE GOVERNOR'S
PROPOSAL TO CONTINUE TO DIG INTO
THE DATA AND IF THERE ARE
REASONABLE REASONS FOR. THE
PRICES TO BE HIGH THAT THAT IS
AN EXEMPTION A PATHWAY SO I
THINK. THE WITH WITH THE POINT
OF SETTING THEM AT A LEVEL THAT
TO NOT TOUCH THE PROFITS MORE
THAN THRICE IN KANNAPOLIS TEN
YEARS AND THEN YOU'RE LOOKING
AT- PROVIDING AT LEAST PATTERN
IF THERE IS A REASONABLE AND
JUST BECAUSE- IT'S NOT THAT
PROVIDES BOTH BOTH SIDES OF IT.
AND AS AN ADMIN TO YOUR QUESTION
. ON THE STRATEGIC RESERVE. WE
HAD THE ENERGY COME. BOTH FROM.
THE P. MAC THE PETROLEUM MARKET
ADVISORY COMMITTEE IN TWENTY
FIFTEEN AFTER THE TORRANCE
EXPLOSION HAVE BEEN THINKING
THROUGH A BETTER IDEA OF
OPPORTUNITIES AND STORAGE HAS
COME UP. AGAIN IN THE AS A
POTENTIAL FOR PRICE MITIGATION
BUT THERE ARE ALSO SOME COUNTER
DATA. FOR EXAMPLE WHEN YOU LOOK
AT THE PRICES GOING UP THIS
YEAR. THE STORAGE ACTUALLY WAS
LOW MEETING THE INVENTORY LEVELS
WERE LOW MEANING THERE IS ROOM
FOR STORAGE SO I THINK IT'S A-
IT'S AN IMPORTANT. QUESTION AND
I THINK IT'S A IT'S IDEA. WE
LOOK FORWARD FOR THE LEGISLATURE
AND GOVERNOR'S OFFICE TO
COMPLETE AND PART OF THE
TRANSPARENCY WOULD SKY AND HAVE
REPORTING ON STORAGE WHICH IS
CURRENTLY. WE CURRENTLY DON'T
HAVE. THANK YOU FOR ANSWERS AND
I WOULD CERTAINLY AGREE THIS IS
NOT AN IDEAL OF IN A COMPETITIVE
MARKET. THANK YOU SO COPIER.
THANK YOU MISTER CHAIR- THANK
YOU VERY MUCH YOUR TESTIMONY
HERE TODAY I. AM A BIG BELIEVER
IN TRANSPARENCY I THINK IT'S-
IT'S GOOD TO HAVE MORE
INFORMATION AND TO BE COMPARING
APPLES TO APPLES AND ORANGES
ORANGES. HOW DOES THE CURRENT
LEVEL OF TRANSPARENCY IN THE OIL
INDUSTRY COMPARED TO. OUR
TRANSPARENCY AND SAY THAN
NATURAL GAS AND ELECTRICITY
SECTOR. THANK YOU SENATOR FOR
THE QUESTION. THE IF WE LOOK AT
THE THREE BROAD INDUSTRIES- THE
ELECTRICITY MARKET. THE NATURAL
GAS AND PETROLEUM MARKET AS YOU
KNOW. THE CQC'S REGULATES ALMOST
80% OF THE MARKET AND BECAUSE OF
THAT WE HAVE INFORMATION. THAT
IS VERY DETAILED- IN TERMS OF
CONTRACTS OPERATIONS MARKETS
COLLECTIVELY BETWEEN CC CPUC AND
CAISO. SO IF WE LOOK AT LIKE ONE
BOOK AND THE ELECTRICITY MARKET
IS ONE OF THE- SECTORS THAT WE
HAVE INCREDIBLE INFORMATION ON.
I'M ALSO WITH THE ELECTRICITY
SECTOR YOU YOU HAVE THE CPUC
DURING THE INTO INTEGRATED-
RESOURCE PLANNING WHICH ALLOWS
FOR FURTHER INFORMATION. ON THE
NATURAL GAS IT'S A SLIGHTLY
LOWER LEVEL- THIS DEREGULATED-
BUT THEY DO NOT DO THE
INTEGRATED RESOURCE PLANNING SO
WE DO NOT HAVE INFORMATION. ON
FORWARD THINKING IN TERMS OF
DATA GAS INDUSTRY. COMPARED TO
THEM WE HAVE LITTLE VISIBILITY
INTO THE PETROLEUM INDUSTRY
ESPECIALLY- IN PUT IN PLACE AS
WE WOULD WE WOULD NEED THE
INFORMATION TO ANSWER THE
DIFFICULT QUESTIONS THAT YOU ARE
FACING TODAY. AND HAVE BEEN
RAISING OVER THE LAST YEAR. CHIU
SOONER EGGMAN. THANK YOU AND
THANK YOU FOR YOUR
PRESENTATIONS- TO FOLLOW UP ON
MY COLLEAGUE CENTER GALLEY ATD
DOLLARS QUESTIONS. UPON THIS
CHART THAT YOU MUST WANT TO
UNDERSTAND THE GASOLINE SUPPLIER
AND RETAIL PRICE PRICING YOU
INCLUDED SO I ASSUME YOU WANT ME
TO UNDERSTAND IT BETTER- CAN YOU
WALK ME THROUGH A LITTLE BIT
MORE HE SAID IT WASN'T ABOUT
COST IT WAS ABOUT SALES SO THIS
IS THIS SALES ACTIVITY. ACROSS
ALL THESE SECTIONS AND IF SO CAN
YOU TALK MORE ABOUT.
TRANSPARENCY ONE OF THE YOU KNOW
WE TALKED ABOUT THE WINDFALL TAX
AND THEN AND THEN TRANSPARENCY.
BUT IF YOU WANT ME TO UNDERSTAND
THIS CAN YOU WALK ME THROUGH
SURE LET ME LET ME TRY AGAIN AND
THEN HE SAID IT'S AN HONOR TO
TRY TO HELP YOU I'M- I'M A
NATIVE OF ROSE STREET IN
STOCKTON SO I'M- FIFTY PLUS
YEARS THERE IN THE NEIGHBORHOOD
I KNOW SO- SO ANYWAY THERE ARE.
VARIOUS PATHS- BY WHICH GAS
STATION OPERATORS. WHO ARE
TRADITIONALLY YOU KNOW IN IN THE
OLD DAYS IT WAS A MUCH MORE
VERTICALLY INTEGRATED. INDUSTRY
AT THE RETAIL LEVEL THAN IT IS
NOW SO NOW- WELL YOU MIGHT SEE
YOU KNOW- THAT. GAS STATION
IT'S- BRANDED AS CHEVRON OR
SOMETHING IT'S- IT MAY BE A
FRANCHISEE OR SOME OTHER
INDEPENDENT RELATIONSHIP- AND
SO. THE GAS STATIONS HAVE
DIFFERENT WAYS OF GETTING. THE
FUEL. AND THE RACK SO HERE THE
GREEN AND THE REST THE COUNTRY
WHICH IS EIGHTY THREE POINT
SEVEN PERCENT. WOULD HAVE SOME
SEPARATION IT'S BAY IT BE SORT
OF AN INDEPENDENT SUPPLIER. YOU
COULD THINK OF IT- IN BETWEEN
THE REFINER LIKE WHO- THERE ARE
FUEL DISTRIBUTION COMPANIES-
THAT. THAT PROVIDE THE SERVICE.
AND YOU CAN EITHER HAVE YOU NO
LONG TERM CONTRACTS OR IF YOU'RE
A IF YOU'RE A BIG OPERATOR- ONE
OF THE HEALTH. BIG GROCERY CHAIN
OR SOMETHING SELLING UNBRANDED
GASOLINE YOU MAY BUY FROM
VARIOUS PEOPLE EVEN IF YOU'RE A
SMALL PERSON YOU MAY- THE- OTHER
PATH. HERE THE DEALER TANK WAGON
AND I HAVE BEEN ABLE TO FIND ANY
OF THE ACTUAL CONTRACTS BUT YOU
CAN SEE THERE'S SOME LITIGATION
THAT. GIVES A PEEK INTO SOME OF
THE CONTRACTS ARE LONG TERM
CONTRACTS THAT GAS STATION
OPERATORS ENTER INTO- THAT
BASICALLY BINDS THEM TO-
TYPICALLY THE REFINER WHO- WILL.
DELIVER THE GAS AT A PRICE- THEY
WILL HAVE DIFFERENT INCENTIVES
TO SELL IT CORRECT THIS IS THE
READ THEY WILL HAVE DIFFERENT
INCENTIVES- PROVIDED IN THE
CONTRACT THEY MAY ALSO PROVIDE-
FINANCING FOR THE BUILDING OF
LIKE A CAR WASH- IT IS THE A
THAT MAY BECOME DO. HIM
IMMEDIATELY IF YOU TRY TO
TRANSFER SUPPLIERS- AND YOU'RE
BASICALLY BINDING YOURSELF TO
ONCE FIRE AT WHATEVER PRICE
THEY'RE GOING TO CHARGE YOU- FOR
QUITE AWHILE AND THE PRICES
CHANGE EVERY NIGHT AND IT'S NOT
AND- AND- EXPECT AND WE DON'T
HAVE VISIBILITY INTO IT BUT IT.
IT SEEMS THAT ALSO THE PRICING-
MAY VERY. EVEN THOUGH IT'S
BASICALLY THE PRICE DELIVERED
EVEN IF IT. HERE THE SAME
DISTANCE AWAY AND THEY'RE
DELIVERING IT THE SAME DISTANCE-
YOU MAY BE PAYING DIFFERENT
PRICES TO THE REFINERS. THEN
SOMEBODY AN EQUAL DISTANCE AWAY.
TIME AS THE- ATTENTION LEE ARE
INVOLVED IN EITHER I THINK SOME
WOULD SAY EITHER IN TRYING TO
MAKE SURE THE MARKET IS VERY
COMPETITIVE OUT THERE. OTHERS
MAY SAY- THAT IT LEADS TO LESS
COMPETITION OUT THERE. SO IT'S A
DIFFERENT MODEL OF DISTRIBUTION
AT A HIGHER COST- THAT WE SEE
HERE AND IT COULD BE THERE COULD
BE A VERY INNOCENT EXPLANATION
WHICH IS THAT. YOU KNOW THE IF
SUPPLIES ARE TIGHT IN THE STATE
THAT YOU WANT TO SIGN UP WITH
SOMEBODY TO MAKE SURE THAT YOU
HAVE A GUARANTEED SUPPLY SO THAT
WHEN PRICES DO YOU KNOW WHEN YOU
CAN MAKE A PROFIT YOU DON'T HAVE
TO PUT. IN A PAPER ON YOUR
THINGS TO SAY OUT OF GAS- SO HE
YOU KNOW THERE ARE LOTS OF
THEORIES ABOUT WHAT'S HAPPENING
AND THE GOVERNOR'S PROPOSAL
WOULD TASK US WITH TRYING TO
FIGURE OUT. WHAT IS ACTUALLY
HAPPENING BY FINALLY LOOKING
INTO CONTRACTS AND LOOKING INTO
THE PRICING WHICH CURRENTLY WE
HAVE NO VISIBILITY. DOES THAT
MAKE SENSE. SORT OF. IT'S CONTRA
. YES WE'RE TRYING TO WORK OUR
WAY THROUGH IT. SENATORS SERRATO
. THANK YOU. THANK YOU VERY
MUCH- SO MY QUESTION IS A LITTLE
BIT MORE BROAD IN THIS APPROACH
THIS THE WINDFALL WINDFALL
PROFITS. TAX IT CAN YOU POINT TO
SOME EXAMPLES EITHER IN THE
UNITED STATES. OR ANYWHERE IN
THE WORLD THAT WE HAVE HAD A
WINDFALL PROFITS TAX THAT IT'S
ACTUALLY WORKED. AND HAVE THE
DESIRED EFFECT THAT WE'RE TRYING
TO WHICH IS TO TRY TO. GO
AGAINST WHAT YOUR ENERGY POLICY
IS CREATED AND LOWER PRICES FOR
GAS. ALSO THERE ARE CURRENTLY
ALL AROUND THE WORLD- SOME
WINDFALL. PROFITS AND TAXES SET
UP DIFFERENTLY THAN THIS-
PROPOSALS AS THE WORLD IS SORT
OF GRAPPLING WITH SKYROCKETING-
ENERGY CHARGES SO YOU'RE SEEING
A- LOT OF PLACES IN EUROPE AT
THE MOMENT THE U. K. HAS IT-
INDIA HAS. BEEN LOOKING INTO THE
E. U. AND OVERALL- AND SO THOSE
ARE IN EFFECT THIS IS A SLIGHTLY
DIFFERENT. IN A NUMBER OF
RESPECTS BECAUSE THEY A IT IS A
PENALTY RATHER THAN TAX. BEATS
ON REFINING- WHICH IS SORT OF AN
ISSUE OF FIRST IMPRESSION-
THAT'S YOU KNOW WHAT THE
CHALLENGE THAT WE'RE- FACING
HERE IN CALIFORNIA IS NOT ONE
OF- EXTRACTORS A YOU KNOW
TYPICALLY IN MANY PLACES IT'S ON
EITHER THE EXTRACTION OF OIL OR
ON ELECTRICITY GENERATION IN
GENERAL BECAUSE THOSE PRICES
HAVE SKYROCKETED IN- THROUGHOUT
EUROPE PARTICULARLY WITH THE-
WAR IN UKRAINE. SO THOSE ARE.
ARE HAPPENING- THEY ARE-
PRODUCING REVENUE THAT IS GOING
BACK TO SORT OF ALLEVIATE THE
CONCERNS I MEAN IT'S THE SAME
IDEA HERE IF THERE IS REVENUE
FROM THE PENALTY WOULD GO TO
ALLEVIATE THE IMPACT THE BURDEN
THAT CALIFORNIA CONSUMERS ARE.
ARE FEELING- IS THEIR RELATIVELY
NEW SO IT'S HARD TO FIGURE YOU
KNOW I DON'T THINK WE HAVE A
LONG TERM VIEW- THE I KNOW THERE
HAVE BEEN. CONCERNS I'LL- REYES
AT FIRST THAT YOU KNOW PEOPLE
SAY WELL WITH THE U. S. TRY THIS
IN THE NINETEEN EIGHTIES. IT WAS
A VERY DIFFERENT MODEL TO
BASICALLY APPLIED NONSTOP IT WAS
BASICALLY AN EXCISE TAX ON ALL-
OIL DRILLED IN THE UNITED STATES
THAT CAME INTO EFFECT- AFTER THE
D. CONTROL OF- WELL GAS PRICES
IN THE US. AND THIS IS A MUCH
DIFFERENT MODEL THAN THAT IT
WOULD ONLY IMPACT AGAIN THOSE
EXTRAORDINARY PROFIT LEVELS THAT
WOULD NOT BE ON DOLLAR ONE- IT
WOULD- IT WOULD ONLY KICK IN AND
KICKING GRADUALLY. IF PROFITS
ARE VERY HIGH ABOVE AVERAGE. SO
THAT'S THE THAT BUT BUT WE DON'T
YOU KNOW THIS IS A- WE ARE
FACING A UNIQUE SITUATION
CALIFORNIAN IT'S A RELATIVELY
UNIQUE PROPOSAL. RIGHT NOW. PART
OF PART OF THE UNIQUE SITUATION
IS THE UNIQUE SITUATION WE'VE
CREATED AND BEING AN ISLAND OF-
THAT TYPE OF CONSUMPTION. AND
OUR SUPPLIES LIMITED ARE BEING
MORE LIMITED- YET OUR DEMAND
REMAINS THE SAME ARE. ABOUT THE
SAME. AND WHEN YOU DO THAT- YOU
KNOW ECONOMICS ONE A ONE. SAYS
YOUR PRICE IS GOING TO GO UP AND
IF YOU'RE DEPENDENT ON FOREIGN
OIL FOR YOUR A MAJORITY OF YOUR
OIL- WERE LEFT AT THE WHIMS OF
FOREIGN OIL WELL EVEN IF YOU
LOOK THOUGH AT THE CHART ON THE
OIL. YOU KNOW THERE'S SOMETHING
HAPPENING HERE IN ADDITION TO
JUST CRUDE OIL PRICES I
UNDERSTAND THAT I THINK IS. YOU
KNOW OKAY I'VE ASKED MY ONE
QUESTION SORRY. TO THE SOONER
MAGOR. SO I SAID IT. IF I MAY
JUST HAVE I THINK AND JUST AS
NICK WAS MY ST WE HAVE. A WE
BEEN THINKING ABOUT THIS THOSE
THREE STAGES OF REFINERY THE
SIDE BUT HE FINALLY SAID IN THE
DETAILS. AND AS NICK MENTIONED
THE CRUDE OIL PRICES IS WHERE
MOST OF THE RAINFALL AT TAXES
HAVE BEEN PUT IN IT. LEAVE IT
LEVIED ACROSS THE ACROSS THE
WORLD AND WOULD BEGINNING TO
SEE. THE RESULTS OF THAT THIS
WOULD BE A VERY UNIQUE PROPOSAL-
ONE AS AS NICK MENTIONED IT'S A
PENALTY BUT ALSO IT'S ON THE
DEFINED OF THE ELEMENT. AND THAT
FOR US INTO ONE OF THE THINGS WE
WANT TO OBSERVE IN THE DATA IS
THAT NOTHING CHANGED OVER THE
LAST FEW YEARS. BUT THAT THAT
PARTICULAR MARGIN HAS BEEN
GROWING SO SIGNIFICANTLY DURING
THESE INCIDENTS. AND ALSO THE
OTHER QUOTE THE THING AROUND.
THIS IS NOT NECESSARILY TRYING
TO CREATE A NEW REVENUE BUT BUT
CLEARLY AS A DETERRENT TO HELP.
REDUCE THE MARGINS. THANK YOU.
THERMADOR THANK YOU MUCH AND
MISTER JUST WANTED TAKE A MOMENT
CITY YOU FOR HOUSE. THIS REALLY
CRITICAL HEARING- IN FOR
BRINGING A TOGETHER TO THANK YOU
SO BRADFORD- WOULD LIKE TO GET
INTO THE OF TRANSFER- AND THE
TRANSFEREE MAY. SEEK BUT I TAKE
TO A SPECIFIC. COMMISSIONER INTO
WHAT YOU ARE ONE LEGISLATURE TO
BE ABLE TO CONSIDER. SO I THINK
THAT FOR ALL OF US TALK ABOUT
TRANSPARENCY. AND WE CAN'T GET
ANY MORE TRANSPARENTLY KNOWING
WHAT YOU'RE GONNA PAY PER GALLON
IN TAXES IT'S ABOUT FIFTY FOUR
CENTS. WHEN IT COMES TO THE
STATE OF CALIFORNIA WHEN IT'S
OUR GAS TAX WERE COMPLETELY
TRANSPARENT ABOUT IT. WE'RE ALSO
TRANSPARENT ABOUT WHERE GO TO
GOES INTO FUNDING ROADS AND
PUBLIC TRANSPORTATION ACROSS THE
STATE. BUT WHERE I AM
CHALLENGED. IS WHERE WE ARE BACK
LAST FALL. IF YOU WERE A
COMMUTER IN LA. YOUR PAIN SEVEN
BUCKS A GALLON. IF YOU'RE A
COMMUTER UP IN EUREKA. YOU'RE
PAYING EIGHT DOLLARS A GALLON. I
WANT TO REPEAT WHAT YOU'RE GAS
TAXES. FIFTY FOUR CENTS FROM THE
STATE. FIFTY FOUR CENTS. SO
THERE'S INCREDIBLE FRUSTRATION.
ON BEHALF OF CALIFORNIANS. AND
AMERICANS. ON WHY THEIR PAIN SO
MUCH. WHEN WE KNOW THE SIX GAS
EXCISE TAXES FIFTY FOUR CENTS.
TO CAN YOU WALK US THROUGH.
COMMISSIONER EXACTLY WHAT YOU'D
LIKE TO LEGISLATURE TO CONSIDER
WHEN IT COMES TO TRANSPARENCY-
SO THAT WE CAN GET A BETTER IDEA
ABOUT WHERE YOU THINK THE C. E.
C. CAN GO AND ONE THAT'S PIECE-
MISTER CHAIR IS. HOW DO YOU SEE
THE CC IMPLEMENTING THIS. IN THE
COMING MONTHS TO WALK US THROUGH
THE MECHANISM AND HOW THAT WOULD
WORK INTERNALLY. THANK YOU I
THINK YOU SAID. FOR THE
QUESTION. I DO WANT TO TAKE A
NICE YOU KNOW WHAT YOU JUST
MENTIONED. ONE OF THE
FUNDAMENTAL RULES OF THE ENERGY
COMMISSION HE STOOD MAINTAIN
SITUATIONAL AWARENESS OF THE
ENERGY TRENDS AND BE ABLE TO
ANSWER QUESTIONS THAT COME FROM
YOU THE LEGISLATURE THE GOVERNOR
OF THE PUBLIC. AND PRECISELY AS
YOU STATED WHEN WE WERE GOING TO
LAST YEAR AND WE WERE TRYING TO
ANSWER THESE QUESTIONS ON
EXACTLY WHY THE PRICE SPIKES
WERE HAPPENING. WE WERE NOT ABLE
TO ANSWER BEYOND A CERTAIN LEVEL
OF DISAGGREGATION. AND SO THE
FUNDAMENTALLY WHAT WE WOULD NEED
IS TO ELEMENTS REAL TIME DATA
NEAR REAL TIME DATA. AND MORE
DISAGGREGATED INFORMATION SO WE
CAN CLEARLY UNDERSTAND AND WILL
PUT UP WHAT EXACTLY IS GOING
THROUGH THOSE FOUR STAGES. SO TO
BEGIN WITH- YOU KNOW THE FIRST
ONE ON THE REFINERY MAINTENANCE
FOR EXAMPLE LAST YEAR. ONE OF
THE QUESTION THAT CAME UP WAS A
LIVE WHERE THE INVENTOR THE
LEVEL SOLO- YOU KNOW WHAT ARE
THE WHAT IS THE WHAT IS THE
CURRENT YOU THE DECENT RATE. OF
THE REFINERIES AND SO ON AND
THOSE QUESTIONS WE CAN'T ANSWER
AND WE CAN'T COMPEL THE INDUSTRY
TO PROVIDE THEM UNLESS OUT OF
THEIR GOODNESS OF HEART AND
SOMETIMES THEY DO. SOME SOME-
SOME PEOPLE BASED ON
RELATIONSHIPS WITH THE STAFF MY
CHILDREN WITH INFORMATION FOR
EXAMPLE THAT HAVING ANOTHER
PRICE SPIKE RIGHT NOW- FOR THOSE
OF YOU WHO ARE KEENLY OBSERVING-
THAT THE MARGINS ARE GOING UP
AGAIN IF ANY MARGINS. AND I
WOULD NOT BE ABLE TO ANSWER TO
YOU THAT INFORMATION I'M GLAD
PROCESS THAT DATA TWO OR THREE
WEEKS FROM NOW. SO I THINK IT'S
REALLY ABOUT COMPELLING THE
INFORMATION IN NEAR. REAL TIME-
FITTED DELAYED. AND THEN TO FIND
THE INFORMATION WOULD BE
EXTREMELY HELPFUL I KNOW YOU
SHUTTING IT DOWN. IN A WHAT ARE
YOUR- PLANNED MAINTENANCE
SCHEDULES SO WE CAN GET A SENSE
OF WHAT THE POTENTIAL SHORTFALLS
IN SUPPLICANT LOOK LIKE. AND
POTENTIALLY TAKE ACTION AS A
STATE SO THAT'S A BIG ONE.
SECOND WE DON'T HAVE CURRENT.
DATA ON SPOT MARKET INTERACTIONS
WE DON'T KNOW WHO'S SELLING TO
GO. QUESTION WAS ASKED EARLIER.
ON THEM THE- DELTIC INDUSTRY ON
THE IN THIS. IF WE GO TO CHI SO
CRISIS HE'S FIFTY TWO. ON A DAY
HAD MARKET BASED. THOSE
INFORMATION X. BECAUSE TO. SO
HAVING A LITTLE BIT MORE AND- ON
THOSE PLANS. WOULD X. WHAT WOULD
HELP US. AND FINALLY THAT THE
INFANTRY HOLDING LEVELS WHAT WE
WOULD LIKE TO DO IS. WORK WITH
YOU CLOSELY TO DEFINE THAT DATA.
AND MAKE IT MAKE SURE THAT IT'S
NOT BURDEN SOME FORTY INDUSTRY
TO PRODUCE AND SO WE CAN USE IT
TO ANSWER THE QUESTIONS YOU
WOULD LIKE. AND IN TERMS OF HOW
CC CAN ACHIEVE THIS. SEASON HAS
BEEN DOING THIS CAN OTHER OTHER
SECTORS. WE DO VERY
DISAGGREGATED ANALYSIS IN BOTH
THE ELECTRICITY INDUSTRY AS WELL
AS GAS INDUSTRY AUGUSTA NATIONAL
GAS INDUSTRY WE DO NOT DO THAT
CAN GASOLINE BECAUSE WE DON'T
HAVE THE DATA. SO WE ARE
EQUIPPED TO PROCESS THE DATA WE
HAVE METHODOLOGIES AND MODELS
SET UP. IT'S ABOUT BEING ABLE TO
RECEIVE THE INFORMATION SO WE
CAN QUICKLY ANSWER THE
QUESTIONS. THE COMMISSION. THANK
YOU SENATOR START. THANK YOU
MISTER CHAIR AND- WELCOME TO-
THIS CHAIRMANSHIP WE KNOW YOU'VE
HAD. THE ASSEMBLY TERROR. BEFORE
BUT- IT'S A- CRUCIAL TIME AND WE
APPRECIATE HAVING SOMEBODY
EXPERIENCE AT THE HELM HERE SO-
THANK YOU FOR HOLDING THIS
HEARING. AND YOU KNOW I ALSO
APPRECIATE THE NEWSMEN
MINISTRATION IN PARTICULAR
GOVERNOR. FOR PUSHING US TO BE
HERE TODAY AND TO BE WRESTLING
WITH THESE ISSUES- YOU KNOW
PEOPLE GOT HURT. AND I DON'T
THINK WE'LL EVER FULLY
UNDERSTAND THE HUMAN TOLL OF
WHAT HAPPENS. LAST YEAR- AND
WHAT IT MEANS TO PAY. SEVEN
DOLLARS A GALLON- WHEN YOU'RE
DRIVING THREE OR FOUR HOURS A
DAY TO- MINIMUM WAGE JOB. FROM
THE SPRAWLING BEYONCE OF LA AND
WHAT THAT DOES TO A FAMILY'S
BUDGET WHERE YOU ARE MAKING LIFE
OR DEATH DECISIONS IT IT DOESN'T
LOOK LIKE IT WHEN YOU. DRIVE BY
THE GAS STATION BUT WHEN YOU.
YOU KNOW YOU'RE TRYING TO MAKE A
DECISION BETWEEN FEEDING YOUR
FAMILY OR BUYING PRESCRIPTION
DRUGS- OR PAYING FOR CARE AND
YOU HAVE TO MAKE A CHOICE-
GETTING TO WORK IS. IS ONE OF
THOSE PLACES WHERE THEY CALL THE
ECONOMISTS CALL ELASTIC DEMAND-
BUT- MORE SIMPLY PUT WHAT
DRIVERS ARE HELD OVER A BARREL
IN CALIFORNIA HERE AND- I THINK
THE GOVERNOR HADN'T STEPPED UP
WE MIGHT NOT BE HAVING THIS
CONVERSATION AT ALL. SO I
APPRECIATE THAT- NO TO I GUESS I
WANT TO BILL ON- BOTH CENTER
COPIER AND SENATE MCGUIRE.
POINTS V. THE ANALOG- TO THE
UTILITY EXPERIENCE THAT THAT YOU
YOU SORT OF MENTIONED WE'VE
TOUCHED ON. AND ACKNOWLEDGE IT
THAT THE CHAIR- BY HAVING
ANOTHER HEARING ON THIS NATURAL
GAS UTILITY BILL SPIKE THING IS
CRUCIALLY NEEDED I APPRECIATE
THAT ANNOUNCEMENT. AND AS-
FURIOUS AS I AM ABOUT WHAT WE
SAW IN THE IN THOSE GAS BILL
UTILITY SPIKES- MY UNDERSTANDING
IS THAT UNDER CURRENT LAW BOTH
STATE AND FEDERAL. THAT WE WILL
HAVE SOME RECOURSE POTENTIALLY
FOR REPAIRS IF THERE WERE- IF
THERE WAS MARKET MANIPULATION
OCCURRING- IF THERE WERE- YOU
KNOW EFFORTS ON SPOT MARKETS ARE
IN CONTRACTING EITHER THROUGH
FOR OVERSIGHT. OR THROUGH THE
STATE SEE IF YOU SEE THAT WE CAN
GET PEOPLE HOPEFULLY THEIR MONEY
BACK LIKE WE DID WITH ENRON.
TOOK TOO LONG BUT WE WENT AND
GOT THEIR MONEY BACK. IT IS WHAT
I'M HEARING YOU SAY THAT WE
DON'T HAVE THAT RECOURSE RIGHT
NOW TO GET PEOPLE'S MONEY BACK
FOR WHAT THEY LOST LIKE THAT
THERE'S NO WAY. WHEREAS WE CAN
DO THAT IN THE NATURAL GAS
SECTOR TO SOME EXTENT AND
ELECTRICITY DEFINITELY YOU
YOU'RE SAYING THAT THERE. THAT
EVERY THE LOSSES THAT THAT
WORKING PEOPLE IN CALIFORNIA
TOOK OVER THE LAST YEAR SO AND
BEFORE THERE'S NO. THERE'S NO
SORT OF EQUIVALENT RECOURSE. AND
THERE IS AND I THINK YOU'LL AYE
IS THERE IS ONLY IF YOU COULD
SHOW AN ANTITRUST VIOLATION-
WHEN- YOU KNOW YOU'LL HEAR I
THINK FROM THE DEPARTMENT OF
JUSTICE AND A LATER PANEL- BUT I
THINK THAT IS THE ONLY RECOURSE
WHICH IS WHY I THINK IT'S ALSO
REALLY IMPORTANT TO. EVEN IF
EVEN IF THE MARKETS ARE WORKING
AT A WHICH IS VERY QUESTIONABLE
EVEN IF THEY'RE WORKING- I DO
THINK THE PENALTY PROVIDE SOME.
RECOURSE IN THE FUTURE DOESN'T
GET US THE BACK THE THREE
BILLION DOLLARS OR SO THAT WAS
TRANSFERRED LAST YEAR FROM ALL
CALIFORNIANS TO FIVE COMPANIES.
BUT IT DOES- PROVIDE SOME-
AVENUE TO TRY TO RECOUP SOME OF
THAT. PROVIDED TO CALIFORNIA
CONSUMERS IF THIS WERE TO HAPPEN
AGAIN BUT I DON'T KNOW OTHER
THAN THE AND I TRUST. AVENUE IF
BUT I DON'T KNOW THAT- YOU KNOW
I THINK. THAT'S A TALL ORDER TO
. I APPRECIATE THAT COLD COMFORT
I USE IN MY FOLLOW UP QUESTION
WOULD BE ARE THERE LESSONS WE
CAN LEARN OR DRAW ON FROM. THE
UTILITY SIDE IN TERMS OF THE
DATA WE'RE LOOKING FOR I KNOW
YOU TALKED ABOUT REAL TIME
PRICING DATA MY UNDERSTANDING IS
EVEN IN THE MODEST
IMPLEMENTATION OF THIRTEEN
TWENTY TWO. SB THIRTEEN TWENTY
WE PASSED LAST YEAR THE BILL IN
HISTORY IS NOT PETITION THE CC
AND IS ESSENTIALLY RESISTING THE
FIRST TRANCHE OF. OF THAT KIND
OF DISCLOSURE CAN YOU CAN YOU
JUST TALK ABOUT HOW THE CECE'S
RESPONDING THAT PETITION. NO
FURTHER QUESTIONS ON THAT THANK
YOU MR THANK YOU CENTER STERN.
YES SO ON THIRTEEN TWENTY TWO-
WE SEE IT AS A LEGISLATION THAT
WE NEED TO ENACT. SUCH AS THE
ENERGY COMMISSION WE IT'S VERY
CLEAR TO US WHAT THE LEGISLATURE
WANTS US TO DO. AND WE INTEND TO
GET THAT THAT THAT INFORMATION
STARTING MARCH YES YOU ARE
CORRECT- THE- DAY THE INDUSTRY
REQUESTED TO STARTED RULEMAKING.
TO CLARIFY SOME OF THE TERMS BUT
WE THINK YOU KNOW THAT THE END
OF THE DAY DISTILLATION DOES NOT
REQUIRE US TO DO IT RULE MAKING.
TO DEFINE THOSE ELEMENTS. THE
TWO ELEMENTS THERE ONE WE WOULD
EXPECT THE DATA TO BE SUBMITTED-
AND SECOND TO THE EXTENT. THAT
THIS IS AN ACTIVE SESSION THE
INDUSTRY HAS AN OPPORTUNITY TO
WORK WITH ALL OF YOU AND ANY
FURTHER LEGISLATION OF CLARITY.
THANK THANK YOU SENATOR. THANK
YOU MISTER CHAIR. AND I
APPRECIATE ALL THE INFORMATION
YOU'RE PROVIDING HERE TODAY-
CLEAR WE NEED TO DO BETTER BY
OUR CONSUMERS AND- SO MANY OF
OUR FAMILIES ARE STRUGGLING. BUT
I WANT TO BRING YOU BACK TO- ON
COMEY JUST MADE EARLIER TODAY-
ONLY BECAUSE WE KNOW WITH
EVERYTHING EVERYTHING SO NEIL
AND THERE'S ALWAYS UNINTENDED
CONSEQUENCES AND- TRY TO
UNDERSTAND IT I BELIEVE YOU SAID
THAT YOU QUE HAD. ALREADY
SOMETHING SIMILAR THAT THEY'VE
BEEN IMPLEMENTING BUT IT'S VERY
NEW SO YOU DON'T HAVE A LOT OF
INFORMATION TO. ASCERTAIN TO
WHETHER OR NOT IT'S WORKING. DO
YOU HAVE ANY INFORMATION. ONE
WAY OR THE OTHER OF CONCERNS
ALREADY UNINTENDED CONSEQUENCES
OR ON THE OTHER SIDE. THAT IT'S
WORKING CAN YOU SPEAK TO THAT A
LITTLE BIT FURTHER THANK YOU.
ONE AND- LET ME CONFESS
SOMETIMES. I HAVEN'T STUDIED IT
IN GREAT DETAIL BUT- THERE ARE
CONCERNS AYE I KNOW THERE'S SOME
CONCERNS THERE BEING EXPRESSED
BECAUSE IT APPLIES TO ALL-
ELECTRICITY GENERATION AS WELL
AS THE OIL EXTRACTION IN THE
NORTH SEA- ONE OF THE THINGS
THEY'VE TRIED TO DO AND I THINK
IT'S POSSIBLE HERE INTO THE
CONSTRUCT OF THE GOVERNOR'S
PROPOSAL. IS TO PROVIDE A CREDIT
FOR ACTUAL INVESTMENT. IN-
DIFFERENT TYPES OF FAVORED
ENERGY PRODUCTION SO THAT THEY
CAN GET BEYOND THE SYSTEM AND I
THINK THAT'S SOMETHING THAT.
THAT THE GOVERNOR'S PROPOSAL
CONTEMPLATES THAT YOU CAN TAKE
INTO ACCOUNT. AND CELESTE AND I
THINK TO TAKE AWAY AND IT WAS A
RIGHT. CLEVER WAY TO CONSTRUCT
IT TO. TO PROVIDE SOME INCENTIVE
FOR PEOPLE ACTUALLY INVEST IN
THE REFINERIES. TO DO THE
MAINTENANCE TO KEEP THEM
FUNCTIONING AND MAYBE EVEN
IMPROVE THE FUNCTIONING- AND NOT
HAVE THAT APPLY AGAINST THESE
PENALTY CAPS- BECAUSE INSTEAD I
THINK WHAT. RIGHT I DON'T. I
THINK THE BILLIONS OF DOLLARS
THAT WERE TRANSITION TRANSFERRED
LAST YEAR- PROBABLY SHOWED UP
MORE IN THE PROFIT STATEMENTS
THAN THEY DID IN TERMS OF THE-
YOU KNOW. MAINTENANCE BUDGETS IS
BUSINESS. A SUPPOSITION I THINK
WE NEED TO KNOW MORE BUT- BUT IF
THERE'S A WAY TO BOTH IMPOSED
THE PENALTY AND PROVIDE AN
INCENTIVE TO MAKE SURE THAT THE-
THE ENERGY PRODUCING THE
GASOLINE PRODUCING ASSETS IN
CALIFORNIA. REMAIN ROBUST. I
THINK THAT'S ONE MASSIVE HIT-
CENTER JUST A CENTRIFUGES TO ADD
TO THAT IN JUST A DELAYED
MEETING AND- THE OPPORTUNITY FOR
THE CC TO PROVIDING EXCEPTIONAL
PATHWAYS SO ONCE AN OPEN UP
DEPENDING ON HOW THE SESSION
BECAUSE- IF THERE IS A PENALTY
IN PLACE AS A LAW. CC WILL HAVE
TO CONSIDER A CLAUSE A
LEGISLATIVE PROCESS AND DOUBLE
OF GUIDELINES AND TAKE PUBLIC
INPUT ON HOW BEST TO STRUCTURE
THOSE LEVELS AND MOVE THEM
AROUND TO ENSURE. THAT THERE IS
NO ADVERSE EFFECTS. THANK YOU
YOUR ANSWERS. THANK MISTER THANK
YOU SENATOR ALSO. THANK YOU- I'M
JUST AS IF NOT MORE- UPSET AND
ANGRY AS- MY- COLLEAGUE- ABOUT
THE IMPACT THAT IT'S HAD ON POOR
AND WORKING PEOPLE. ALWAYS SEEM
TO BE THE ONES WHO GET THE-
WORST IMPACT. THEIR LOW INCOME
THEIR ESSENTIAL WORKERS. THEY'RE
HIGHLY IMPACTED BY EMISSIONS ARE
HIGHLY IMPACTED IN MY DISTRICT
THERE'S FIVE FREEWAYS THEY GO
THROUGH- INTO THESE COMMUNITIES
SO. THAT'S MY STARTING POINT AND
I URGE ALL OF US TO CONTINUE TO
MAKE THAT A PRIORITY FOR US NO
MATTER WHAT THE PROPOSAL IS IN
FRONT OF US AND NOT FOR PROFIT
GET THAT. I WANT TO JUST ASK YOU
I DON'T THINK IT WOULD BE A LONG
ANSWER BUT- I'M PARTICULARLY-
LOOKING AT THE TRANSPARENCY
ISSUE OF THE PROPOSAL- SO IS
THAT I UNDERSTAND THAT. SOMEONE
PREPARED THIS CHART HERE SO IN
IN NINETEEN SEVENTY NINE. MAYBE
AS A RESULT OF THE ENERGY CRISIS
THE PETROLEUM INDUSTRY
INFORMATION REPORTED ACT. RIGHT
ABOUT WAS. ESTABLISHED. TWO
THOUSAND NINETEEN EIGHTY- AND
THEN YOU GO ON NINETEEN YEARS
LATER THERE'S ANOTHER ATTEMPT.
TO ADDRESS GAS INDUSTRY
PRACTICES AND- MERGERS- WITH THE
GOAL OF PREVENTING OIL SHOCK
PRICES AND THEN FIVE TO NINE
YEARS LATER THERE'S A GASOLINE
PRICE TASK FORCE. AND THEN IN
TWENTY FOURTEEN THERE'S A
PETROLEUM MARKET ADVISORY
COMMITTEE- AND THEN A REPORT
THREE YEARS LATER IS GIVEN TO
US- AND NOW WORK WERE TALKING
ABOUT THE SAME THING. SO OVER OF
FORTY THREE FORTY FOUR YEARS.
THERE WERE BEEN. MINIMALLY SIX
OR SEVEN. OF PROPOSAL'S
ATTEMPTS. TO ADDRESS GAS PRICES
GASOLINE PRICES WITH THE IDEA OF
WE NEED MORE INFORMATION WHEN WE
GET MORE INFORMATION. WILL WILL
ADDRESS THIS WILL SOLVE THIS.
WHAT HAPPENED. WHAT HAPPENED AND
WHAT IS DIFFERENT ABOUT WHAT IS
BEING PROPOSED BECAUSE I DON'T
WANT THIS TO BE ANOTHER- ITEM ON
THE CHART. AND IN TWENTY TWENTY
THREE WE DID SUCH AND SUCH ON
THIS PROPOSAL AND TEN YEARS
LATER WHEN THE SAME PLACE. SO
WHAT WILL BE DIFFERENT ABOUT
THIS WHAT IS DIFFERENT ABOUT THE
KIND OF INFORMATION. WHAT IS
DIFFERENT FROM EVERY OTHER
ATTEMPT AND BELIEVE ME I'M
LOOKING FOR. A SOLUTION HERE
THAT WILL STOP THESE GAS PRICES
FROM- SPIKE IN THE WAY THAT THEY
HAVE BUT- HOW WE HOW IS THIS
DIFFERENT. THANK YOU SENATOR-
JUST WANTED A GOOD NICE- YOUR
STATEMENT ON IN WHO GETS
IMPACTED WHEN THE PRICES ARE SO
HIGH AND I AM PRETTY GOOD NICE
YOUR SENTIMENT AND EMPATHY ON
THAT ISSUE. IN TERMS OF WHAT YOU
KNOW WE HAVE TRIED TO DO IN IN
IN SECURING MORE INFORMATION
OVER THE YEARS. I HAVE BEEN A
MEAT IMMIGRATED TO CALIFORNIA IN
TWENTY YEARS AGO CALLED MY HOME
AND I'VE BEEN FOLLOWING IT OVER
THE LAST TWENTY YEARS THE WORK
IN CALIFORNIA BUT MORE SO IN THE
LAST FIVE YEARS. ONE OF THE
THINGS THAT HAS REALLY CHANGED
IS THE MOMENT WE HAD IN. I THINK
THIS IS A UNIQUE MOMENT- OF
TRANSITION OF PUBLIC TRUST IN
PUBLIC PASSED ON ON TRANSPARENCY
WHICH WE HAVE NOT SEEN BEFORE.
AND I THINK THIS IS AN
OPPORTUNITY FOR US TO REALLY
WEIGH IN AT BUT THIS
EXTRAORDINARY MOMENT TO GET THAT
DATA AT THE END OF THE DATA AND
AT THE END OF THE DAY AS A-
STATE AGENCY. THAT IS LOOKING TO
IMPLEMENT THE LAWS OF THE STATE
TO THE BEST OF OUR ABILITY WE
WOULD NEED THAT INFORMATION AND
WE LOOK TO YOUR LEADERSHIP ON
HELPING US SECURE THAT
INFORMATION. SO ONCE AND ONCE WE
HAVE THAT INFORMATION I KNOW
DEPENDING ON HOW MUCH MORE WE
GET THAT WOULD BE THE DEAL
DIFFERENCE IN US BEING ABLE TO
ARTICULATE. AND WHAT'S GOING ON
AND ALSO THE SECOND THING ON THE
GOVERNOR'S PROPOSAL. IS THAT
THIS IS THE FIRST TIME WE HAVE
HAD A PROPOSAL. THAT'S CONCRETE
AND COMPREHENSIVE IT HAS BOTH
ELEMENTS ON FIGURING OUT WHAT WE
CAN DO IMMEDIATELY IN THE SHORT
RUN. AND HOW DO WE ATTEMPT TO
MITIGATE THE PRICE SPIKES IN THE
SHORT RUN. BUT ALSO PROVIDES FOR
SEPARATE ELEMENTS OF
TRANSPARENCY ALL THE WAY FROM
INVESTIGATION REPORTING
COUNTING. TO REALLY GIVE US
DIFFERENT VENUES TO ANALYZE THE
DATA. WE NEED- STATE EMPLOYEES.
WHO CAN LOOK AT THIS INFORMATION
WE NEED ACADEMICS WHO CAN LOOK
AT THIS INFORMATION WHICH IS THE
ADVISORY COMMITTEE THAT WILL BE
LOOKING INTO. WE NEED. DIRECTION
. AND AUTHORITY FOR- THE
LEGISLATURE. TO AGENCIES LIKE US
TO WORK TOGETHER TO MAKE SURE WE
ARE- PUTTING OUR- TO. AND
POPULAR OF. CASTING TOGETHER SO
I THINK THE- THAT'S DIFFERENCE I
CANNOT SPEAK TO YOU KNOW WHAT
HAS HAPPENED IN THE PAST BUT- IT
DEPENDING ON HOW THE SESSION
GOES BEAT HERE TO SUPPORT YOU.
WITH THE INFORMATION YOU NEED
AND WE LOOK FORWARD TO DOING
THEIR BEST IN IMPLEMENTING
SOLUTIONS AND IF I COULD JUST
ADD SENATOR I THINK YOU WILL
HAVE SOME MEMBERS ON. SUBSEQUENT
PANELS WHO WERE INVOLVED IN P.
MAC AND I THINK EVEN THERE THERE
WAS. NOT ACCESS TO A LOT OF THE
INFORMATION THAT. THE GOVERNOR
IS NOW SAYING YOU NEED TO HAVE
ACCESS TO SO AT CDFA. YOU KNOW.
I THINK WE WOULD HAVE A VERY
DIFFERENT AUDIT PROGRAM IF WE
JUST RECALL- RELIED ON PEOPLE
VOLUNTARY VOLUNTARILY PROVIDING
US INFORMATION- YOU KNOW IT'S IS
WE'RE AT A POINT WHERE I THINK-
WE NEED TO MOVE BEYOND SORT OF.
HAVING VOLUNTARY SHARING OF
INFORMATION AND START USING THE
STATE'S AUTHORITY TO GET THE
INFORMATION THAT YOU ALL NEED TO
MAKE INFORMED POLICY DECISIONS I
THINK THAT'S ONE DIFFERENCE IS.
IS REALLY- REQUIRING STRONG
MANDATE. THANK YOU AND LAST
QUESTION. POST CENTER DOT. YES
JUST FOR BREVITY I'D LIKE TO
ASSOCIATE MY COMMENTS WITH THE
CENTER GARAGE SO. BUT THERE'S
JUST ONE COM YOU WANT ONE OF THE
THINGS I'M HEARING IS THIS IS
SCOTT YOU SAID TWO WORDS
CONCRETE AND SOMETHING ELSE. IN
TERMS OF THIS PROPOSAL. YOU KNOW
. THIS IS OUTRAGEOUS WE ALL ARE
ABOUT WHAT'S HAPPENED TO THE
LOWEST- AMONG US IN OUR IN OUR
RESPECTIVE DISTRICTS. AT THE
SAME TIME WHEN I TRY TO LOOK FOR
HERE IS WHAT THE HELL ARE THE
UNINTENDED CONSEQUENCES THE
POSSIBLE UNINTENDED
CONSEQUENCES. THAT COULD HURT
THOSE VERY PEOPLE. THE OUT THE
TO A GREATER TO GREATER EXTENT.
IT SO MY QUESTION IS- WOULD'VE
REFINERS. GET OUT DECIDES TO-
SHIP THE PRODUCT ELSEWHERE. TO
AVOID ANY THESE PROFITS IS THAT
SOMETHING THAT YOU GUYS HAVE
LOOKED AT WHAT WOULD WE DO IF WE
HAD THOSE KIND OF SUPPLY ISSUES
. YES WE HAVE LOOKED AT IT AND
THEN IT'S A VERY VALID CONCERNS-
YOU KNOW ONE THING THAT'S
INTERESTING IF YOU LOOK BACK
OVER DECADES- THE SO. BY
PIPELINE WE REALLY ONLY A
PIPELINE SHIPPING ACCESS TO
NEVADA AND ARIZONA ARIZONA CAN
ALSO DRAW FROM- TEXAS- FROM
THEIR REFINERY STAKE THEY CAN
DRAW FROM BOTH ENDS OF THE
STATE- WITH ALL OF THE PRICE
FLUCTUATIONS AND PROFITABILITY
FLUCTUATIONS IN CALIFORNIA
THOSE. EXPORTS HAVE REMAINED- A
REMARKABLY STEADY PERCENTAGE OF
THE CALIFORNIA REFINING OUTPUT
SO THAT'S ONE THING- OBVIOUSLY
IF. THERE AND THERE'S- THERE'S
ALSO A LOT OF DATA AND- THAT
CALIFORNIA IS- THE MOST- AMONG
THE MOST PROFITABLE MARKETS FOR
THESE ENTITIES. SO IF WE REACHED
A POINT WHERE IT ACTUALLY BECAME
MORE PROFITABLE FOR THEM TO
EXPORT EITHER TO THOSE TWO
STATES OR TO. LOAD THE REFINED
GASOLINE ON TO SHIPS AND SEND IT
TO LATIN AMERICA OR OTHER
PLACES. THAN HEY WE WOULD HAVE
THE TRANSPARENCY INTO WHAT'S
HAPPENING IN B. THE C. C. WOULD
HAVE THE ABILITY TO ADJUST- IF
THAT WERE TO HAPPEN BUT IF YOU
LOOK AT THE PRICING AND OUTPUT
DATA OVER YEARS- I THINK THE
CHANCES OF THAT HAPPENING WHEN
WE'RE STILL SETTING THE- MARGIN.
AT AN AMOUNT THAT ALLOWS VERY
HEALTHY PROFITS THAT IN MOST
YEARS ARE WELL ABOVE WHAT
THEY'RE EARNING I THINK. IT
SEEMS. OR MAYBE IT'S SEEMS
UNLIKELY. THANK YOU APPRECIATE
THAT. SENATOR GONZALEZ. THANK
YOU CHAIR MISTER CHAIR- I WANT
TO THANK YOU AS WELL FOR VICE
CHAIR- GLINDA FOR YOUR WORK ON
THE C. E. C. HAVING A VERY
EXTENSIVE HEARING- WITH YOUR
COLLEAGUES EVEN WHEN THE GAS AND
OIL INDUSTRY WAS NOT IN
ATTENDANCE SO I REALLY WANT TO
THANK YOU FOR THAT BECAUSE- AS
MENTIONED BY MANY OF MY
COLLEAGUES HERE. WE HAVE ANSWERS
THAT WE NEED TO PROVIDE AND
CLEARLY WE DO NOT HAVE THAT
OBSCURE CONTRACTS SUPPLY
LIMITATIONS THAT PEOPLE DON'T
KNOW ABOUT AND EXPLICABLE
MYSTERY SURCHARGES ALL OF THE
ABOVE. MY QUESTION AND YOU'VE
SORT OF TOUCH THAT ALREADY BUT I
REALLY WANT TO KNOW ON THE
INDEPENDENT ADVISORY COMMITTEE.
PROCESS THAT OVERSIGHT THAT I
THINK IN ADDITION TO THIS ENERGY
COMMITTEE WILL NEED TO CONTINUE
THROUGHOUT THIS PROCESS SHOULD
THIS PROPOSAL MOVE FORWARD. HAS
TO BE CLEAR CUT TO PEOPLE NEED
TO KNOW ON GOING WHAT IS
HAPPENING SO WE DO NOT HAVE
THIS- SPIKE. AGAIN SO HOW DO YOU
FOR SEE THAT I SEE IN HERE YOU
KNOW INVESTIGATION- YOU KNOW
BOTH FOR YOU AND- DIRECTOR
MADURO'S THE INVESTIGATION PEAS
AUTHORITY TO EXAMINE BOOKS AND
RECORDS WE'VE TALKED ABOUT. BUT
ANY ADDITIONAL ITEMS TO OF NOTE
THAT WE CAN JUST THINK ABOUT IN
TERMS OF THIS COMMITTEE. AND
WHAT IT COULD POTENTIALLY DO.
I'LL BEGIN AND- TO ME TO MAKE
MIGHT WANT TO ADD TO IT I THINK
THAT FUNDAMENTALLY I THINK THAT
SOME OF THE LESSONS WE'VE
LEARNED. IN THE PAST SENATOR.
ABOUT THE P. MAC WAS THE DATA
WAS NOT ACCESSIBLE TO THEM. SO
BECAUSE MUCH OF THE DATA WAS
CONFIDENTIAL- WE WERE NOT ABLE
TO SHARE THE DATA WITH THEM. AND
IT WAS ANOTHER DIPLOMAT MEMBERS
HAVE TO ASK THE QUESTIONS. AND
THEN THE BUT IN A STAFF MIGHT BE
ABLE TO ANSWER THEM BASED ON THE
INFORMATION. SO I THINK IT'S
IMPORTANT FOR US TO CONSIDER HOW
TO MAKE SURE THAT THE P. MAC
MEMBERS ARE ABLE TO ACTUALLY
LOOK AT THE DATA. THEMSELVES AS
WE MOVE FORWARD. AND PROVIDE
THOSE- DISCOUNTS BUT
CONFIDENTIALITY REQUIREMENTS TO
ENSURE THAT THAT DATA IS
PROTECTED. BUT THEY HAVE AN
OPPORTUNITY TO ASK INDEPENDENT
QUESTIONS AND ANSWER THEM I
THINK THAT'S AN IMPORTANT
ELEMENT. TO A NUMBER OF THE P.
MAC MEMBERS PREVIOUSLY- HAD VERY
LIMITED ROLES THEY WERE THEY
WERE DOING AT THE GOODNESS OF
THEIR HEART. I THINK THAT MIGHT
BE AN OPPORTUNITY FOR US TO.
SUPPORT THEM WITH THE RESOURCES
TO ENSURE. THAT THE TIME IS USED
IN THE MOST VALUABLE SO IT THOSE
ARE THE. TWO THINGS I WOULD ADD
THANK YOU THANK YOU. GREAT THANK
YOU AND I WANT TO THANK YOUR
THANK YOU FOR YOUR PRE. I ONE
THING MY COLLEAGUES FOR THEIR
GREAT QUESTIONS BUT I'M STILL A
CONFUSION I'M TRYING TO
UNDERSTAND. WHAT WE'VE- BEEN
TRYING TO SOLVE FOR IS IT PRICE
PRICING OR SUPPLY AND I THINK WE
ALL AGREE. THAT SUPPLY WILL
IMPACT PRICING. I THINK WE'LL
ALL AGREE THAT WE HAVE PASSED
LEGISLATION HERE IN CALIFORNIA
THAT IS ENCOURAGE LEAVING OIL IN
THE GROUND. WE'VE ENCOURAGED THE
CONVERSION OF REFINERIES AND
SHUTTING DOWN OF REFINERIES AND
WE'RE ENCOURAGING. INDIVIDUALS
TO MOVE FROM. A FUEL AND
COMBUSTION ENGINE CARS TO
ELECTRIC CARS. HAVE WE CREATED A
SCENARIO THAT HAS. HELPED CREATE
THIS PROBLEM THROUGH THE
LEGISLATIVE PROCESS. AND MY
SECOND PIECES UNLIKE THE ENERGY
CRISIS WE KNEW WHO THOSE
CUSTOMERS WERE WHO. GOT THAT
ELECTRIC BILL EVERY MONTH WE
HAVE NO IDEA WHO DROVE THEIR CAR
DURING THIS PERIOD OF TIME SO
HOW WOULD YOU DETERMINE WHO GETS
TO REFINE. WELL I CAN TAKE THAT
AYE I THINK YOU ARE RIGHT THAT
IT'S REALLY A SUPPLY ISSUE
RATHER THAN A PRICING ISSUE I
MEAN I DON'T THINK THAT- YOU
KNOW THE SUPPLY DRIVES THE- DR
SURPRISE PARTICULARLY WHEN THE
DEMAND IS SO ELASTIC AS WAS WAS
MENTIONED- AND- IT MAY BE. YOU
KNOW I THINK CLEARLY- YEP
CALIFORNIA'S AGGRESSIVE TAKE ON
IT- ENVIRONMENTAL PROTECTION
OTHER THINGS. DOES IMPACT THAT
ALTHOUGH THEY'RE ALSO YOU KNOW-
SO MANY LIVES SAVED IN- THE
HEALTH IMPACTS OF YOU KNOW THE-
THE HEALTH BENEFITS OF THE CAR
BLEND FUEL ARE ALSO ENORMOUS FOR
CALIFORNIA STRICTLY FOR. MANY
WHO ARE THE MOST VULNERABLE KIDS
AND ELDERLY AND THOSE I'M WITH
HEALTH ISSUES ALREADY SO. IT'S
IT IS ALL THE TRADE OFF THOSE
ARE POLICY QUESTIONS I THINK FOR
ALL OF YOU TO CONSIDER AS YOU'D
BE TRYING NAVIGATE THE SYSTEM I
THINK THAT'S WHY IT'S SO
IMPORTANT TO SPECIALLY NOW AS WE
ARE. REALLY AT THIS INFLECTION
POINT. WITH GASOLINE I MEAN THE
STATISTICS OF- MENTIONED YOU
KNOW WHAT WAS IT. A DECADE AGO
ONE IN A THOUSAND CARS WASN'T
EASY. LAST QUARTER ONE IN FOUR
SOLD IN CALIFORNIA WAS IN THE V.
I MEAN IT'S WE'RE AT AT A POINT
WHERE YOU ALL AND THESE ARE AND
WILL DO WHATEVER YOU TELL US
WHERE YOU ALL HAVE TO MAKE SOME
TOUGH DECISIONS ABOUT. WHAT
DIRECTION THE STATE GOES AND
WHAT THAT FUTURE LOOKS LIKE AND
THERE ARE TRADE OFFS I THINK
THAT'S FAIR AND THE OTHER. POINT
WAS. HOW DO WE DETERMINE WHO
GETS A REFUND WELL. YOU KNOW AS
YOU KNOW FROM LAST YEAR THERE
WERE. IT'S COMPLICATED AND WITH
AN FTP STEPPED IN AND SENT IT
OUT THERE ARE DEPENDING I MEAN
HOPEFULLY. THIS PENALTY WOULD
NEVER. GO INTO EFFECT IF MONEY
CAME IN I MEAN THERE LOTS OF
IDEAS EITHER TO SEND IT OUT OR
TO. MAYBE PROVIDE SOME REDUCTION
APPLY IT TO EVERYBODY'S- LIKE-
REGISTRATION RENEWAL FOR THEIR
CARS SO THAT YOU KNOW BUT THEN
YOU ONLY GET THE DRIVERS
ALTHOUGH THEY'RE THE ONES PAYING
TAXES BUT IT IS YOU KNOW I KNOW
THEY'RE CONCERNED ABOUT THOSE
WHO CAN'T EVEN AFFORD A CAR AND
THEN THEY'RE LEFT OUT- SO. BY I
THINK THE ADMINISTRATION'S OPEN
TO LOTS OF IDEAS TO FIGURE OUT
HOW TO HOW TO DO THAT BUT AGAIN.
I AM. HOPEFUL THAT THE ON THE IS
AN ATTACK SYSTEM TO RAISE
REVENUE MEANT TO CHECK BEHAVIOR
. YES BRADFORD I'M JUST TO. ADD
TO THE POINT. THAT YOU JUST
ELEVATED. I THINK YOU KNOW IT'S
ULTIMATELY THAT THIS ENERGY
TRANSITION AS WE MOVE TOWARDS
THE CLEAN ENERGY GOALS HE'S
GOING TO BE BUMPY- I THINK THAT
IF THERE'S GOING TO BE TRADE
OFFS. IN THE WAY OF THE APPROACH
TO POLICY AND AS NICK MENTIONED
WE LOOK TO LEADERSHIP ON BOTH.
COUNSELING THE QUESTIONS YOU
HAVE FOR US AND THE DIRECTION
YOU MIGHT WANNA TAKE AS YOU MOVE
FORWARD THANK YOU SIR. BOTH
THANK YOU CAN COMMISSIONER
GUNTER HANNAH DIRECTOR MADURO'S
FOR YOUR TESTIMONY IN YOUR TIME
HERE TODAY SO THANK YOU VERY
MUCH AND WE'RE GONNA MOVE ON TO.
OUR SECOND PANEL. AND OUR SECOND
PANEL WILL CONSIST OF- SEVEN
PRISONERS WERE GONNA ASK THEM
ALL TO LIMIT THEIR PRESENTATION
TO. FIVE MINUTES WE'RE GONNA
HAVE ROSS BROWN THE LEGISLATIVE
ANALYST'S OFFICE FOLLOWED BY.
MICHAEL JORGENSEN- SUPERVISING
DEPUTY ATTORNEY GENERAL OFFICE
OF ATTORNEY GENERAL. AND SEVERIN
BORENSTEIN WHO I KNOW IS ONLINE-
WHO WILL BE TESTIFYING AFTER
THAT JAMES SWEENEY. DAVE
HACKETT. AND I'M ROBERT MCCALL
SO ON. AN ALASKAN WHEN MICHAEL
MRS WELL PROFESSOR FROM THE USC.
ITSELF BUT THOSE ARE HERE WILL
START IN THAT ORDER. AND- SPUR
WHEN YOU REDEEM BEGIN. THANK YOU
MISTER CHAIR AND MEMBERS ROSS BY
THAT THE LET ANALYST'S. GOOD
AFTERNOON- I'M GOING TO BE
MAKING SOME HIGH LEVEL COMMENTS
I'M GONNA BE PRESENTING KIND OF
OFFER A HAND OUT THAT- WE PUT
TOGETHER HOPEFULLY YOU'LL HAVE
A- COPY OF IT LOOKS LIKE THIS
IT'S NOT I THINK THE SERGEANTS
HAVE A VERSION. IS ALSO A FEW
HARD COPIES AVAILABLE IN THE
AUDIENCE FOR THOSE WHO WANT ONE
FOR THOSE WHO ARE FOLLOWING
ALONG AT HOME. IT SHOULD BE
POSTED ON THE COMMITTEE'S
WEBSITE AS WELL AS OUR OFFICE'S
WEBSITE AT A LEO DOT CA. DOT GOV
SO I IN THE JUST IN THE INTEREST
OF TIME I'M NOT GONNA GO THROUGH
ALL OF WHAT'S IN THERE THERE'S
SOME BACKGROUND- BUT I'M GONNA
TRY TO TOUCH ON SOME HIGH POINTS
AND- REALLY I'M GONNA- NOT FOCUS
TOO MUCH ON THE SPECIFICS OF THE
GOVERNOR'S PROPOSAL BUT REALLY
TRY TO DO SOME KIND OF HIGH
LEVEL FRAMING AROUND SOME OF THE
DISCUSSION THAT YOU'VE HAD AND
PROBABLY. SOME OF THE ADDITIONAL
COMMENTS HERE THROUGHOUT THE
REST OF THE DAY FROM OTHER
PRESENTERS- SO IF YOU SKIP TO
PAGE TO ACTUALLY JUST KINDA-
DESTROYER TENSION TO THE SYSTEM
INFORMATION THAT MAYBE IT
ENERGY. COMMISSION PRESENTED.
APOLOGIES I DIDN'T SORT OF SEE
THEIR- PRESENTATION SO- BUT
REALLY JUST KIND OF YOU KNOW
HIGHLIGHTS A FEW DIFFERENT
PRICES IN THE MARKET PLACE AGAIN
CRUDE OIL PRICES. SPOT GASOLINE
PRICES WHICH IS REALLY MORE OF
KIND OF A WHOLESALE PRICE OF
AFTER. GASOLINE LEAVES THE
REFINERY BEFORE IT GETS TO THE
GAS STATION. AND THEN THE TOP
LINE THERE IS RETAIL PRICES AND
SO YOU CAN KIND OF THIS IS A-
LONGER RUN KIND OF LOOK IT OVER
THE LAST. TEN YEARS SOME OF
THOSE TRENDS OVER TIME. PAGE
THREE- IS AND A LITTLE BIT MORE
AT OVER THE LAST YEAR HOW. THOSE
PRICES HAVE CHANGED- AND YOU CAN
SORT OF SEE THE VOLATILITY IN
SOME CASES CRUDE OIL VOLATILITY
IN OTHER CASES IT'S MORE KIND OF
THE GASOLINE. AS IT LEAVES THE
REFINERY IN THE VOLATILITY
THERE. SO THEY'RE KIND OF
DIFFERENT PLACES WHERE YOU SEE
THAT VOLATILITY- NEXT. I'D LIKE
TO TRY ATTENTION A PAGE FOR
WHICH REALLY I THINK IT KIND OF
GETS THAT- KIND OF ONE OF THE
MAIN THINGS THAT WOULD LIKE TO
EMPHASIZE IN OUR COMMENTS HERE
AND FOR THE LEGISLATURE. WHICH
IS REALLY TRYING TO ENCOURAGE
THE LEGISLATURE TO BE AS CLEAR
AS POSSIBLE ABOUT ITS PROBLEM
DEFINITION HAS THAT KIND OF
UNDERTAKES THESE EFFORTS- SO NOT
NECESSARILY KIND OF HOW THE
GOVERNOR AND YOU MAY SHARE KIND
OF THE GOVERNOR'S. DEFINITION OF
THE PROBLEM BUT THERE ARE FOR
IDEAS. KIND OF ISSUES THAT HAVE
BEEN HIGHLIGHTED BOTH IN THIS
CONVERSATION AND JUST AS PART OF
THE PUBLIC DISCUSSION- AND WE
SEE SOME OF THE ISSUES IS YOU
KNOW RELATED BUT ALSO SOMEWHAT
DISTINCT AND SO- WE DO THINK
IDENTIFIED THE PROBLEM CLEARLY
IS IMPORTANT BECAUSE IT CAN
HELP. FOCUS POLICY ACTIONS
TOWARDS THE MOST. KIND OF
DIRECTLY TARGETED OUT THE
PROBLEM- AND THAT MAKES THEM
MORE LIKELY THAT THE PROPOSED
POLICIES AFFECTED OF IT AT
ADDRESSING THAT PROBLEM AND FOR
REDUCE THE RISKS OF UNINTENDED
CONSEQUENCES. SO I MEAN
HIGHLIGHTED- JUST THREE- THEY'RE
MOSTLY DISTINCT ISSUES THAT KIND
OF COULD BE SORT OF POTENTIAL
PROBLEMS THAT THE LEGISLATURE
WILL- CAN KIND OF LOOK INTO AND
LOOK AT POLICY SOLUTIONS THAT
HAVE BEEN RAISED AS PART OF THE
DISCUSSIONS ONE. A LOT OF
DISCUSSION ON GASOLINE PRICE
SPIKES SO THOSE SORT OF SPIKES
THAT YOU SEE ON THE ON THE
PREVIOUS CHARTS THAT'S ONE. TWO
IS SORT OF A CONSISTENTLY HIGHER
GASOLINE PRICES THAT WE SEE IN
CALIFORNIA RELATIVE TO THE REST
OF THE COUNTRY. AND THEN THREE
IS KIND OF THIS ISSUE OF.
EXCESSIVE PROFITS GOING TO
BUSINESSES WHICH WE KIND OF SEE
THOSE THREE. SOMEWHAT DISTINCT
ISSUES AND SO- IF YOU TURN TO
PAGE FIVE WE JUST HAVE SOME
BRIEF COMMENTS ON THE FIRST ONE
ON THE GASOLINE PRICE SPIKES-
AND REALLY WE THINK SORT OF. YOU
KNOW TO THE EXTENT THIS IS SORT
OF THE PROBLEM DOESN'T
DEFINITION PART OF THIS PROCESS
COULD INCLUDE KIND OF
IDENTIFYING. WHERE IN THE PRICE
SPIKES WERE NEXT SORT OF SUPPLY
CHAIN THESE PRICE SPIKES ARE
OCCURRING AS IT OUT. YOUR THAT
CRUDE. OIL LEVEL WHICH IS AGAIN
SORT OF A GLOBAL MARKET LEVEL.
WHOLESALE PRICES OR RETAIL
PRICES. FROM THE KEY QUESTIONS
MY WHEN I THINK. ABOUT YOU KNOW
ARE THESE PRICE SPIKES DRIVEN BY
AS FOR THE BASICS. AND OF. AND
THAT YOU WOULD KNOW TO. SEE IN A
COMPETITIVE- OR ARE THERE OTHER
ISSUES SUCH AS MARKET POWER. DUE
TO LIMITED COMPETITION THAT
CONTRIBUTE TO SOME OF THE
SPIKES. AND A CONCERTED DRIVE
WHAT POTENTIAL. LEGAL OR
REGULATORY APPROACHES THE
LEGISLATURE MIGHT WANT TO PURSUE
THAT AS MENTIONED BEFORE A LOT
OF DISCUSSION IN PREVIOUS.
EXPERT REPORTS ON KIND OF THE
SPIKES HAS LOOKED AT ISSUES
AROUND. STORAGE AND RESERVE
REQUIREMENTS AND THOSE TYPES OF
THINGS THOSE ARE OFTEN KIND OF
THE TYPES OF THINGS THAT YOU'LL-
CAN APPEAR DISCUSSED ON SOME OF
THE PRICE SPIKE. ISSUES IF YOU
TURN TO PAGE SIX THE CONFECTION
CATEGORY AGAIN CONSISTENTLY
HIGHER PRICES COMPARED TO
NATIONAL AVERAGE AS YOU. ALL ARE
THINK ARE WELL AWARE OF
CALIFORNIA HAS CONSISTENTLY
HIGHER PRICES- PART OF THAT
DIFFERENCE WE CAN EXPLAIN PRETTY
EASILY I THINK WITH STRIPS
DIFFERENCES IN TAXES AS WELL AS
CERTAIN ENVIRONMENTAL PROGRAM
COSTS- BUT I'M SURE YOU'LL HEAR
AGAIN SORT OF LATER THIS. FROM
OTHER PRESENTERS THIS ISSUE
OTHERS THERE IS ALSO SORT OF A
BIT OF THAT DIFFERENCE THAT IS
UNEXPLAINED AND AS SPENCER DOT
THIS MYSTERY GASOLINE SURCHARGE
AND SO- KEY QUESTIONS ARE WHAT
PORTION OF THAT KIND OF PRICE
DIFFERENCE. IS THE LEGISLATURE
MOST CONCERNED ABOUT CLEARLY FOR
THE TAXES AND ENVIRONMENTAL
PROGRAMS THOSE ARE INTENTIONAL
POLICY DECISIONS THAT YOU KNOW
CHANGES THERE OF COURSE WOULD
COME WITH. YOUR BIG TRADE OFFS
FOR SOME OF THOSE OTHER PUBLIC
POLICY GOALS. BUT YOU ALSO SIR
WHAT FACTORS MIGHT CONTRIBUTE TO
THAT UNEXPLAINED DIFFERENCE IN
KIND OF YOU KNOW DEPENDING ON
WHAT WE FIND THERE THAT MIGHT
KIND OF HAVE DIFFERENT
IMPLICATIONS FOR WHAT THE POLICY
SOLUTIONS MIGHT BE. THIRD GOING
TO PAGE SEVEN THE ISSUE OF
EXCESSIVE PROFITS- YEAH. IF THE
LEGISLATURE DETERMINES THAT
DAVIS REALLY IS KIND OF A
JUDGMENT CALL ON KIND OF WHAT IS
CONSIDERED EXCESSIVE PROFITS. IF
THE THRESHOLD EXISTS- RESULTING
POLICY GOAL MIGHT BE TO KIND OF
REDISTRIBUTE THOSE THOSE
PROFITS. ON SOME KEY QUESTIONS
ARE WHAT LEVEL OF PROFITS ARE
CONSIDERED EXCESSIVE. HOW CAN
EXCESSIVE PROFITS BE
DIFFERENTIATED FROM CYCLICAL
FLUCTUATIONS. AND HOW DOES EACH
POTENTIAL POLICY APPROACH
ULTIMATELY EFFECT. AGAIN THE
SUPPLY OF GASOLINE AND THE
PRICES THAT CONSUMERS PAY AND
SO- I REALLY WANT TO KIND OF
JUST EMPHASIZE- AND WRAP UP MY
COMMENTS AND KIND OF THAT FINAL
POINT AND INSISTED. THESE ARE IN
SOME WAYS SORT OF SOMEWHAT
DISTINCT ISSUES- WE SEE THERE
ARE RELATED ALSO- AND ONE POLICY
PROBABLY ISN'T GOING TO ADDRESS
ALL OF THEM- AND TARGETING
SOLUTIONS IS IMPORTANT. AND EVEN
WITH SOME TARGETED SOLUTIONS
IT'S QUITE POSSIBLE THAT A-
POLICY MEANT TO ADDRESS ONE OF
THEM MIGHT HAVE KIND OF. ADVERSE
IMPACTS ON ON ANOTHER SO FOR
EXAMPLE- YOU KNOW WHAT TAXING
PROFITS AND DISTRIBUTING SOME OF
THAT INCOME COULD SORT OF RE
DISTRIBUTED TO CONSUMERS COULD
ADDRESS SORT OF THE ISSUE OF. IF
THE LEGISLATURE THINKS THE ISSUE
OF CONVICTS OF PROFITS IS THE
BIG ISSUE BUT IT COULD ALSO HAVE
OTHER IMPLICATIONS OF COURSE
FOR- FOR- PRICES AND BOTH SORT
OF THE SHORT TERM AND THE LONG
TERM AND SO. YOU KNOW IMPORTANT
TO KIND OF THINK ABOUT HOW HOW
THE DIFFERENT GOALS AND POLICIES
INTERACT WITH ONE ANOTHER SO. I
WILL IN MY COMMENTS THERE AND
HAPPY TO ANSWER ANY QUESTIONS
WHEN THE TIME COMES THE CHRIS
BROWN. NEXT UP IS MICHAEL JORDAN
SAID. OKAY WE'RE ON. THANK YOU
TO REDFORD GOOD AFTERNOON
COMMITTEE MEMBERS MY NAME IS
MIKE JORGENSEN- SUPERVISING
DEPUTY ATTORNEY GENERAL TO
CALIFORNIA'S YOUR ATTORNEY
GENERAL'S OFFICE. I'M IN THE
ANTITRUST SECTION. THE OIL
INDUSTRY AND GASOLINE PRICES
HAVE BEEN THE FOCUS OF THE CAR
AND I TRUST SECTION AT THE
CALIFORNIA AG'S OFFICE FOR MANY
YEARS. AND THE SUBJECT OF
NUMEROUS INVESTIGATIONS AND
SEVERAL LAWSUITS. OUR PRINCIPAL
PARTNER HAS BEEN THE FEDERAL
TRADE COMMISSION. WHICH HAS A
DEDICATED TEAM INCLUDING BOTH
LAWYERS AND ECONOMISTS. THE
CALIFORNIA ENERGY COMMISSION IS
AN IMPORTANT RESOURCE FOR BOTH
OF US. IN UNDERSTANDING MARKET
CONDITIONS CONDITIONS AND TRENDS
. AND I TRUST HIM FORSMAN
CALIFORNIA IS GENERALLY DIRECTED
TO TWO THINGS OVERALL MARKET
CONSOLIDATION THAT IS MERGERS.
AND ANTI COMPETITIVE COLLUSION
AS TO PRICE OR SUPPLY. SINCE TWO
THOUSAND WE HAVE INVESTIGATED
EIGHT OIL COMPANY MERGERS OR
ACQUISITIONS RANGING FROM B. P.
AMOCO. ARCO CHEVRON TEXACO IN
THAT SAME YEAR- TWO MARATHON
SEVEN ELEVEN TWO YEARS AGO. IN
MOST CASES THE MERGING PARTIES
WERE REQUIRED TO SPIN OFF A
NUMBER OF ASSETS TO COMPETITORS
BRINGING NEWCOMERS TO
CALIFORNIA. SUCH AS I BELIEVE
VALERO AND TESORO INTO
CALIFORNIA MARKETS. ON THE
CONDUCT SIDE IN TWENTY SEVENTEEN
ATTORNEY GENERAL BECERRA WENT TO
COURT. TO BLOCK VALERO'S
ACQUISITION THAT'S A MERGER NOT
A CONDUCT CASE OF THE LAST MAJOR
REFINED PRODUCTS STORAGE AND
MIXING FACILITY IN NORTHERN
CALIFORNIA. OUR SUCCESS IN DOING
SO WAS HAILED AS WITHIN THE NHS
TRUST COMMUNITY AS A BROWN
GROUNDBREAKING EXAMPLE OF
INDIVIDUAL STATE ENFORCEMENT OF
THE FEDERAL MERGER LAW. MADE
MORE NOTABLE BECAUSE IT INVOLVED
A VERTICAL ACQUISITION RATHER
THAN A MERGER OF HEAD TO HEAD
REFINERY OPERATIONS. DURING THE
LAST TWO DECADES THE SECTION HAS
INDEED CONDUCTED SEVERAL
INVESTIGATIONS INTO PRICE FIXING
BY CALIFORNIA REFINERS MOST
NOTABLY FOLLOWING PRICE SPIKES
AFTER HURRICANE KATRINA AND
SUBSEQUENT PRICE SPIKES. ONE LED
TO AN ANTI TRUST LAWSUIT FILED
IN TWENTY TWENTY NOT AGAINST THE
REFINERS BUT AGAINST TO GLOBAL
TRADING ENTITIES. THE DUTCH
COMPANY VITALE AND CORINNE
COMPANY SK TRADING INTERNATIONAL
AND ITS DOMESTIC AFFILIATE SK
ENERGY. THAT LAWSUIT CONCERNS
COLUSA TRADING PRACTICES
OCCURRING SEVERAL YEARS AGO. AND
IS SCHEDULED TO GO TO TRIAL IN
SEPTEMBER TWENTY TWENTY THREE
THIS YEAR. IT IS FILED IN SAN
FRANCISCO SUPERIOR COURT. A
CHALLENGE TO THE COURT'S
JURISDICTION OVER S. K. TREATING
INTERNATIONAL WAS REBUFFED FIRST
BY THE TRIAL COURT AND THEN
AGAIN BY THE COURT OF APPEAL THE
CALIFORNIA SUPREME COURT. HAS
NOW DENIED THAT PETITION FOR
REVIEW MEANWHILE HOWEVER THAT
CASE IS CURRENTLY ACTIVE AND IT
ADVERSARIAL LITIGATION. SO MY
REMARKS ABOUT IT IN RESPONSE TO
ANY QUESTIONS ABOUT IT ARE
NECESSARILY LIMITED. CONCERNING
OPTIONS FOR POSSIBLE ACTION- GAS
PRICES WILL CONTINUE TO BE A
PRIORITY AREA FOR AND I TRUST
HIM FOR ME FORSMAN IN FUTURE
YEARS. IT IS A PRIORITY SHARED
BY MANY OTHER STATES. WHICH
PARTICIPATE WITH US IN A MULTI
STATE WORKING GROUP UNDER THE
AUSPICES OF THE NATIONAL
ASSOCIATION OF ATTORNEYS GENERAL
AND I TRUST HAS FORCE. AND
SHARED ALSO BY THE FEDERAL TRADE
COMMISSION. EDUCATION WHETHER IT
IS TO BLOCK A MERGER SUCH AS A
BOLERO PLANES CASE OR TO REMEDY
PRICE MANIPULATIONS AS IN THE
SKV TALL CASE REQUIRE MAJOR
INVESTMENT OF STAFF AND MONEY.
AN ACTIVE LAWSUIT CAN BE
EXPECTED REQUIRE AT LEAST ONE
THIRD OF OUR SECTION STAFF AND
MILLIONS OF DOLLARS AND EXTERNAL
COSTS. NON LITIGATION OPTIONS TO
MITIGATE PRICE SPIKES ARE LOGGED
LARGELY OUTSIDE THE JURISDICTION
OF THE AG'S OFFICE. SEVERAL WERE
DISCUSSED IN HEARINGS BEFORE THE
ENERGY COMMISSION'S- BITTERLY
MARKET DIVISOR COMMITTEE THE
TEANECK. BECAUSE SOME WERE ALSO
DISCUSSING THE MAY TWO THOUSAND
REPORT. REPAIRED PREPARED BY-
COMMITTEE FORMED BY FORMER AG
LOCKYER. FINALLY FURTHER DATA
GATHERING REGARDING INDUSTRY
TRANSACTIONS ALONG THE LINES OF
THOSE GATHERED BY THE CDC
REGARDING REPORTING OVERSIGHT
GATHERING AND PROCESSING DATA IS
BENEFICIAL FOR MARKET OVERSIGHT.
BY GOVERNMENT ENFORCERS DURING
CALIFORNIA'S TRANSITION TO CLEAN
TRANSPORTATION FUTURE. THANK YOU
FOR INVITING- THE AG'S OFFICE TO
TODAY'S HEARING ALL TURN TO THE
NEXT PANELIST FOR THEIR OPENING
REMARKS AND LOOK FORWARD TO ANY
QUESTIONS- AFTER THE OTHER
PANELISTS I BELIEVE WE'RE GOING
TO VIDEO BUT NOW. THANK YOU
RESTORED TO NEXT UP IS PROFESSOR
ORANGE DEAN. WHO IS DIRECTOR OF
THE ENERGY INSTITUTE AT HAAS
BUSINESS SCHOOL UC BERKELEY.
THANK YOU VERY MUCH- AND FIVE
MINUTES ISN'T NEARLY ENOUGH TO
COVER THE SUBJECT SO I'M GONNA
MOVE PRETTY FAST. I WAS CHAIR OF
THE PETROLEUM MARKET ADVISORY
COMMITTEE DURING- MOST OF THE
TIME EXISTED IN ON IT FOR ITS
ENTIRE TIME- I'VE STUDIED
GASOLINE MARKETS FOR OVER THIRTY
YEARS- AND- I ACTUALLY WAS A BIT
OF A SKEPTIC THERE WAS A PROBLEM
IN CALIFORNIA'S MARKET AS
RECENTLY AS TWENTY FIFTEEN- BUT
SINCE THEN. THINGS HAVE REALLY
CHANGED AND NOW I THINK WE DO
HAVE A PROBLEM THAT WE REALLY
NEED TO ADDRESS AND THIS GRAPH
REALLY SHOWS WHAT THE PROBLEM
IS. PRIOR TO TWENTY FIFTEEN IF
YOU LOOKED AT IN FEBRUARY OF
TWENTY FIFTEEN IN THE TORRANCE
FIRE IF YOU LOOK AT THE PRICING
CALIFORNIA VERSUS THE REST OF
THE COUNTRY AND YOU HAVE TO TAKE
CALIFORNIA OUT OF THE COUNT U.
S. AVERAGE TO DO THAT WHICH MANY
PEOPLE DON'T- BUT WHEN YOU DO IT
CORRECTLY WHAT YOU SEE. IS THAT.
CALIFORNIA'S PRICE WAS HIGHER
THAN THE REST OF THE COUNTRY BY
ALMOST EXACTLY ON AVERAGE THE
HIGHER TAXES AND FEES. AND WE
TOOK THOSE OUT WE WERE PRETTY
MUCH IN LINE. AFTER FEBRUARY OF
TWENTY FIFTEEN THAT HASN'T BEEN
THE CASE AND TWENTY TWENTY TO OF
COURSE WAS A HUGE OUT LIAR. I'VE
DUBBED IT THE MYSTERY GASOLINE
SURCHARGE AND THE MYSTERY
GASOLINE SURCHARGE IN TWENTY
TWENTY TWO WAS WELL OVER EIGHT
BILLION DOLLARS- THE
CALIFORNIANS PAID IN EXCESS OF
WHAT THEY WOULD HAVE PAID. IF
CALIFORNIA PRICES WERE IN LINE
WITH THE REST OF THE COUNTRY BUT
FOR THE HIGHER TAXES AND FEES
AND COST OF MAKING THE CLEANER
BURNING GAS LINE. BUT WHAT'S
IMPORTANT IN PARTICULAR FOR THE
DISCUSSION WE'VE BEEN HAVING SO
FAR IS THIS GRAPH. WHICH IS THE
SPOT MARKET PRICE. AND WHAT IT
SHOWS IS THAT BIG TECH UP IN
TWENTY FIFTEEN IS NOT COMING
FROM THE SPOT MARKET PRICE THE
SPOT MARKET PRICES THE PRICE FOR
LARGE TRANSACTIONS BETWEEN
REFINERIES. AND MAJOR TRADERS.
MILLION GALLONS OR MORE AND IT'S
JUST NOT THERE IN FACT OVERALL
IF YOU LOOK AT THE MYSTERY
GASOLINE SURCHARGE SINCE TWENTY
FIFTEEN. LESS THAN A THIRD OF IT
CAN BE ATTRIBUTED TO THESE
HIGHER WHOLESALE PRICES. THE
OTHER TWO THIRDS IS DOWNSTREAM
FROM REFINERIES AND THAT MEANS
THAT POLICIES INTENDED TO AFFECT
REFINERIES ARE NOT GOING TO GET
THAT MOST OF THE REASON
CALIFORNIANS ARE PAYING HIGHER
PRICES FOR GASOLINE. IN FACT THE
SPIKE IN TWENTY FIFTEEN IN
TWENTY TWENTY TWO ILLUSTRATES
THAT THIS IS FROM OPUS AND I HAD
TO TAKE IT FROM A SCREENSHOT
BUT- BASICALLY WHAT IT SHOWS IS
THAT THE WHOLESALE PRICE IN THE
RACK PRICE IN THE SPOT PRICE
DROP VERY SUDDENLY. AFTER THE
GOVERNOR MOVED FORWARD WINTER
BLEND GASOLINE- BUT THE RETAIL
PRICE DIDN'T THE RETAIL PRICE
THE STATE HIGH FOR ANOTHER TWO
MONTHS. AND THAT'S WHAT THE BIG
SOURCE OF THE MYSTERY GASOLINE
SURCHARGE- IN TWENTY TWENTY TWO.
SO THE PROBLEM IS NOT AT THE
RACK THE ONCE YOU GET MOVED
DOWNSTREAM. IT'S PRETTY CLEAR
THAT WE HAVE A LESSEN PATTER
MARKET FEWER STATIONS FEWER
UNBRANDED STATIONS- BIGGER
BRANDED UNBRANDED PRICE
DIFFERENTIALS- THAT IS THE
BRANDED STATIONS GET GET A MUCH
HIGHER MARGIN OF DIFFERENCE.
ABOVE THE UNBRANDED COSCO'S AND
SPEEDWAYS AND SO FORTH. THE
EXACT CAUSE OF THIS I DON'T KNOW
AND I DON'T THINK ANYONE HERE
TODAY KNOWS. IT'S SOMETHING THAT
WE REALLY NEED TO INVESTIGATE AN
INVESTIGATION THAT REALLY IS
PRIMARILY LED BY PEOPLE WHO ARE
EXPERTS IN COMPETITION POLICY.
AND I HAVE HUGE RESPECT FOR THE
CC BUT THAT IS NOT ONE OF THEIR
SKILL SETS- WE REALLY NEED
PEOPLE WHO DO. THIS SORT OF
INVESTIGATION CLOSER TO WHAT THE
ATTORNEY GENERAL'S OFFICE DOES
BUT THE ATTORNEY GENERAL'S
OFFICE AS THE PREVIOUS SPEAKER
SAID TENDS TO FOCUS ON ENFORCING
ANTITRUST LAWS. NOT MORE BROADER
CONSIDERATION OF REGULATIONS AND
I'M HAPPY TO TALK FURTHER ABOUT
THINGS WE COULD- WHO SHOULD
CARRY OUT THE INVESTIGATION HOW
IT SHOULD BE DONE BUT SINCE I
ONLY GET FIVE MINUTES- I'M GONNA
MOVE ON FROM THAT- SO PROVIDING
IS A MOST OF. PROBLEM MOST OF
THE SOUL. THAT GO PANEL A
STRATEGIC. THAT WAS RAISED
EARLIER INVENTORY REQUIREMENTS
ARE NOT GOING TO ADDRESS IT- TWO
THIRDS OF THIS PROBLEM IS
DOWNSTREAM FROM THAT PRICE THAT
WE'RE TALKING ABOUT SO I THINK
THAT WE REALLY NEED TO FOCUS
MORE ON THAT- THE- BUT PEOPLE
WANT TO KNOW WHAT'S GOING. WELL
AT WHAT THE PERFECT TO THE PRICE
GOUGING PENALTY MR MADURO'S DID
A GREAT JOB OF POINTING OUT IF
THE PROBLEMS MARKET POWER. THEN
THE PRICE GOUGING PENALTY COULD
ACTUALLY BE HELPFUL AND COULD
PUSH DOWN PRICES AND INCREASE
SUPPLY BUT THE PROBLEM IS REAL
SCARCITY. AND THERE IS A AND NOT
PRIMARILY CAUSED BY MARKET POWER
IT WILL REDUCE SUPPLY AND
ACTUALLY COULD CAUSE LESS SUPPLY
TO GO ON THE MARKET THAT DOESN'T
MEAN WE'RE GOING TO HAVE GAS
LINES NECESSARILY. BECAUSE THE
OTHER FACTOR THIS IS THIS IS AT
THE ROOT THE RACK PRICE. AND
THIS WILL BE SALES TO RETAILERS
AND THERE'S NO REASON RETAILERS
COULDN'T THEN IF THERE'S A REAL
SHORTAGE OF SUPPLY SUCK THAT UP.
BY RAISING PRICES DOWNSTREAM AND
EARNING THE PRIDE AND TAKING THE
PROFITS THAT THE REFINERS ARE
GETTING SO I THINK THAT WE HAVE
TO RECOGNIZE. THAT THIS ISN'T
ALL OF REFINERY PROBLEM.
POURTANT LES. I CAN'T TELL THE
DIFFERENCE EASILY BETWEEN WHAT'S
MARKET POWER AND WHAT'S TRUE
SCARCITY AND NO ONE ELSE HERE
TODAY CAN THIS IS A REALLY
DIFFICULT CALL IN ANY INDUSTRY.
AND PARTICULARLY IN REFINING
BECAUSE THEY HAVE MANY DIFFERENT
INPUTS MANY DIFFERENT OUTPUTS
THEY'RE DOING COMPLEX
OPTIMIZATION BETWEEN THEM IN
ORDER TO FIGURE OUT WHAT TO
SELL. SO THE PENALTY OR TAX CAN
ALLOW THE GOVERNMENT TO CLAW
BACK SOME PROFIT FROM HIGH
PRICES. BUT IT CAN ALSO DISRUPT
THE MARKET AND FOR THAT REASON I
THINK WE HAVE TO BE CAUTIOUS. IN
OUR USE OF IT. THERE A LOT OF
EXAMPLES I CAN I'M HAPPY TO TALK
ABOUT OF ATTEMPTS AT WINDFALL
PROFITS TAXES ARE PRICE
CEILINGS- AND- BUT I'M GONNA RUN
OUT OF TIME SO I WILL STOP
THERE. THANK YOU. THANK YOU.
NEXT UP WE HAVE JAMES SWEENEY
SENIOR FELLOW FROM STANFORD
INSTITUTE OF. ECONOMIC POLICY
RESEARCH. THANK YOU SO MUCH FOR.
HAVING ME HERE AND I WANT TO
PARTICULARLY THANK. THE
PRESENTATION THAT- MY FRIEND AND
COLLEAGUE SEVEN POINT STAINED
HIS GIVEN. HERE THAT I HAVE IN
THE PAST HAS SOME- I AGREEMENT
SOME DISAGREEMENTS. BUT I LIKE
TO ENDORSE EVERY SINGLE HE SAID
HERE BECAUSE I THINK HE'S
ABSOLUTELY SPOT ON AND WHAT HE
SAID. AND IT'S IMPORTANT SO.
THAT SAVE ME A LITTLE TIME. AS I
LOOK AT THE ISSUE I THINK THAT
IT'S IMPORTANT FOR THE- SENATORS
WHO REALIZED. THAT THERE WAS TO
PROBLEMS. ONE IS A MYSTERY
SURCHARGES HAVE GOOD SECOND ITS
PRICE SPIKES. I THINK THE BIG
COSTS TO THE CONSUMERS IN
CALIFORNIA IS A MYSTERY
SURCHARGE OF WITH ALL THE TIME
THAT'S WITH THE BEEN THE
CUMULATIVE BIGGEST IMPACT I
THINK IT'S IMPORTANT TO
UNDERSTAND THAT THE WINDFALL
PROFITS. PENALTY DOES NOT THINK
ADMIT THAT WHATSOEVER IT ONLY
AIMS AT THE PRICE SPIKES WHICH I
THINK IS THIS THANK THEM. LAWLER
PENALTY IN TERMS OF DAMAGES TO
THE CONSUMERS- DOES THE PURCHASE
POINT- IS SECOND SECOND POINT IS
VISIBILITY YOU'VE HEARD IT FROM
MULTIPLE. PEOPLE EVER SINCE THE
TIME IN THE PETROLEUM MARKET
ADVISORY COMMITTEE AND I WAS ON
THE COMMITTEE I HAD THE HONOR OF
BEING THE FIRST CHAIRMAN AND
DECIDED THAT AS SEVEN BOYS
CHANGE WOULD BE A BETTER
CHAIRMEN AND PROPOSE THAT HE
TOOK OVER AS CHAIRMAN WHICH IT
DID. AND EVER SINCE I THOUGHT
THAT TIME. I BECOME VERY
CONCERNED THAT NOT ONLY DID WE
NOT HAVE ANY TRANSPARENCY BUT
THE RELEVANT THE- GOVERNMENT
AGENCIES IN CALIFORNIA
PARTICULARLY CALIFORNIA ENERGY
COMMISSION DID NOT HAVE ANY TRIP
WILL LEAD THE TRANSPARENCY NAY
NEEDED AND THEREFORE. COMPONENT
OF THIS PROPOSAL THAT WOULD GIVE
THEM MORE TRANSPARENCY INTO THE
MARKET PLACE. AND CAN BE
EXTREMELY IMPORTANT BUT I STRESS
ALONG WITH THE DATA THAT.
PRESIDENT BUSH WAS DOING THIS IN
GAVE YOU. THAT UNDERSTANDING THE
COMPLEXITY OF THE DOWNSTREAM IS
EXTREMELY IMPORTANT AND THE DATA
GATHERING- EXAMPLE THOSE
CONTRACTS- WE FIND A WAY TO A
GRANTED RETAILERS I'M NOT SIMPLE
CONTRACT AND THE ONES IN WHICH
THE PRICES. CAN BE SET FROM THE
WE PUT ON THAT BY THE WEEK
FINERY. AND IF THERE IS A LOCAL
- MIKE POWER SURCHARGE AT A
RETAILER IS GETTING. THE WI FI
NO CAN CAPTURE THAT BY HOW THEY
PRICE THEIR OF THEIR CONTENT.
BIG KATHLEEN AND IN THAT TO THE
RETAILERS SO ALL OF THOSE THINGS
USUALLY WITH PAYING ATTENTION
TO. IF YOU ANALYZE THE WINDFALL
. PROFITS PENALTY. I AM QUITE BE
WHETHER THIS WOULD BE WORK.
FIRST DISTINCTION. THE PRICE
SPIKES. HAPPENED HI THIS. OUR
MARKET FUNDAMENTALS THAT IS A
POOR- REDUCTIONS IN THE SUPPLY
OF GASOLINE- MAINTENANCE SERVICE
SIMULTANEOUSLY- THE TIME WILL
TAKE ANY X. AMONG THE VARIOUS
REFINERS. ACCIDENTS THIS WOULD
HAVE NO REAL OF FAKE BECAUSE
IT'S NOT A PROBLEM IS INCENTIVES
I DON'T KNOW IF THAT'S THE CASE
. THE CASE OF BUCKET POWER
YOU'VE GOT TO REALIZE THAT THE
WAY I BELIEVE IT'S STRUCTURED IT
IS NOT A PROFITS IT'S NOT THE
PENALTY WILL NOT BE A FUNCTION
OF CRAP AND IF IT IS IT WILL
LOOK IN THE WRONG DIRECTION. IT
SEEMS TO BE CAREFULLY AND COULD
BE CAREFULLY DESIGNED SO THAT IT
IT MEANS THE APPARENT PRICE SAID
GOES TO THE REFINERY. PLEASE IT
IT GETS LOWER THAN THE ACTUAL
PRICE IN THE MARKET PLACE SO
THE- ELASTICITY OF DEMAND PACING
NEW FIND OF GOES UP. THAT IN
TERMS OF MARKET POWER IF THE
LAST THING GOES UP THE PRICES
WILL GO DOWN INTO THE INCENTIVE
TO PRODUCE MORE. BUT TO DO THAT
IT HAS TO REDUCE THE PRICE THAT
THE REFINERY GETS AND WITH THAT
WE DO IS PRICES. TO IT IS TO PUT
IT THERE WAS- LAST. I THINK
YOU'VE GOT TO ASK WHICH ONE
BALANCES AND WHICH ONE
DOMINATES. IF THIS IS A LITTLE
PRICE SPIKE. IN THE WAY I'VE
UNDERSTAND THIS. THE PRICE BY.
THE YOUR LAST FIFTY HUNDRED BUT
WILL BOMB AND THEN BE IN TO NOT
BY JOB BY. IF IT IS IT REALLY
PRICE BY THE PRESIDENT PART
ABOUT WILL. AND THE INCENTIVE
WILL BE WHO ARE WE CAN SUPPLY OF
GASOLINE AND SO THIS WOULD MAKE
BIG PRICE REALLY BIG PRICE BANKS
WOULD BE MADE WORSE LITTLE
PLAGUE SPIKES. WOULD BE BANK
BETTER. THAT OF WILL DEPEND UPON
THE POOREST. MANAGING OF THE
FORMULA FOR THESE THIS PENALTY
AND THE PRICE A BIT COMPLETED
BILITY TO ACTUALLY MEASURE ALL
OF THE THINGS THEY HAVE TO
MAJOR. SO I AM ACTUALLY QUITE TO
BE IS THAT EVEN IF THE ISSUE IS
MARKET POWER. WHETHER THIS CAN
BE DEPENDENT BELIEVES SOLVE THE
PROBLEM- BUT IF IT'S NOT MY
COULD POWER THIS JUST GETS IN
THE WAY. SECOND IS THE LONG TERM
CONSEQUENCE I THINK THE REASON
WE'RE HAVING PROVIDES PENALTIES
IS BECAUSE RIGHT NOW WE HAVE A
DYING INDUSTRY WE HAVE A DYING
INDUSTRY THAT THEY SEE THE
HANDWRITING ON THE WALL. THEY
KNOW THAT THE DEMAND FOR
GASOLINE IS GONNA GO DOWN
THERE'S BEEN RELATIVELY LITTLE
INVESTMENT IN NEW CAPACITY WE
DON'T HAVE A LOT OF EXCESS
CAPACITY SO WHEN SOMETHING BAD
HAPPENS- MAINTENANCE TOGETHER-
ACCIDENT WE HAVE A PRICE SPIKE.
WELL IF WE- TAKE AWAY ALL THE
PROFIT OPPORTUNITY SO A LOT OF
THE- OTHER SIGNIFICANT AMOUNT OF
PROFIT OPPORTUNITIES THERE'S
LESS INCENTIVE FOR THE DYING
INDUSTRY TO KEEP BANK CAME IN
THEIR FACILITIES NOT THE HIGHEST
PASSED. THE MORE THAT WE HAVE AN
INCENTIVE TO- WE DO IS A
CAPACITY TO GENERATE THE TO
LEAVE BEHIND GASOLINE. THE
BIGELOW AND POSSIBLY MORE
FREQUENT WILL BE THE PRICE
SPIKES WILL HAVE IN THE FUTURE
SO I'M AFRAID THAT THE EXISTING
POLICY THAT PUT POLITICS IS
COMPOSED. AT THE WILL OF THE
BILLY LOW PROBABILITY OF MAKING
A DIFFERENCE ALTHOUGH WOULD
COULD I CERTAINLY DON'T KNOW.
THANK YOU BUT THAT THE LONG RUN
IT ALSO WITH THE SIGNIFICANT
PROBABILITY OF EXACERBATE THE
PROBLEMS IN THE FUTURE. SO WHAT
CAN YOU DO. THAT IS- COOPER AS
THE BOY'S TEAM SUGGESTED ON THE
PC MAC. WE LOOKED AT A LOT OF
ALTERNATIVES AND ALMOST EVERY
ONE OF THEM IN MY JUDGMENT I
THINK. IN THE COMMITTEE'S
JUDGMENT. THE CAUSTIC THE- FOR
ALL OF THE ALL. THE ONLY ONE IT
SEEMS ME THAT COULD TO MAKE. A
IT IS SOMEHOW WE CAN CREATE MORE
COMPETITION OUT OF STATE. AND TO
CREATE MORE COMPETITION FROM OUT
OF STATE WOULD PROBABLY GONNA
HAVE TO RELAX ENVIRONMENTAL
RULES AND THOSE HAVE SOME BIG
SEVERE ENVIRONMENTAL
CONSEQUENCES SO I THINK IT'S A
POLICY MEANT MAJOR. THE
LEGISLATURE SHOULD BE TAKING IS
TO IS TO LOOK AT IS THERE A WAY
THAT WE CAN SOMEWHAT RELAXED THE
RESTRICTIONS IN CALIFORNIA THAT
MAKE IT SO. DIFFICULT TO COMPETE
FOR MOTHER'S DAY THANK YOU
MISTER. TRAVELER BY MENTAL
DAMAGE. WHAT ARE HAVE HELLO
PRICE. OTHERWISE WE LIVE WITH A
HIGHER PRICE THAT I'M GOING TO
HAVE THANK YOU THANK YOU I WILL
SIR BACK IF WE HAVE MORE TIME
NEXT IN APPRECIATE YOUR
PRESENTATION ACTUALLY HAVE DAVE
HACKETT- IT THE CHAIR OF THE
BOARD OF STILL WATERS
ASSOCIATES- SO MR HACKETT WHEN
YOU'RE READY YOU MAY BEGIN YOUR-
FIVE MINUTES PUSHED. I THANK YOU
MR CHAIRMAN. AND- THANKS FOR OUR
- LET ME COMMON SPEAK TODAY. A
ASSOCIATES THE TRANSPORTATION
ENERGY CONSULTING COMPANY OUR
CLIENTS INCLUDE THE CALIFORNIA
ENERGY COMMISSION THE CALIFORNIA
DEPARTMENT OF JUSTICE. US
DEPARTMENT ENERGY THE ENERGY
INFORMATION ADMINISTRATION THE
ENVIRONMENTAL PROTECTION AGENCY
AS WELL AS TRADE ASSOCIATIONS
AND INDIVIDUAL FIRMS INTERESTED
IN THE SPACE. I WAS A MEMBER OF
THE CALIFORNIA CHOI MARKET IT
BUYS YOU COMMITTEE ALONG WITH
JIM SWEENEY AND SEVERIN
BORENSTEIN. RECENTLY BEEN ASKED
TO MAKE REMARKS ABOUT TODAY'S
TOPIC TO THE C. C. AND SEVERAL
GROUPS OF ASSEMBLY MEMBERS. WHEN
GAS PRICES HAVE GOTTEN TOO HIGH
REPORTERS CALL MANY OF THE
PANELISTS LOOKING FOR AN
INTERVIEW ON THE ISSUE. THE
ISSUES INCLUDE EVERYDAY HIGH GAS
PRICES. PRICE SPIKES TO REFINERY
ISSUES AND GEOGRAPHIC ISOLATION
AND THE HISTORIC RAPID
TRANSITION TO A DIFFERENT FORM
OF TRANSPORTATION ENERGY. THE
BIG ISSUES FAR GAS PRICES SO
HIGH WHAT SHOULD WE DO BE DOING
ABOUT THAT. THERE ARE PRICE
CONTROLS MICHAEL WINDFALL
PROFITS SPELL THE INSTRUCTOR'S.
HIGH PRICES WERE CAUSED BY
SUPPLY ISSUES. IN TWO THOUSAND
TWENTY COVERED BECAUSE OIL
PRICES TO CRASH AS DEMANDED
APPARATED. THE MAN STARTED COME
BACK IN TWENTY TWENTY TO TWENTY
TWENTY ONE. COVERT WAS ROGERS
LARGELY RESPONSIBLE FOR THE
SHUTDOWN OF A MAJOR REFINERY IN
THE BAY AREA. RUSSIA RICK
UKRAINIAN WAR BEGAN IN MARCH OF
TWENTY TWO. AT UPSET WORLDWIDE
TRADE PATTERNS CAUSING MANY
COMMODITY PRICES INCLUDING OIL
TO RISE DRAMATICALLY. CALIFORNIA
GASOLINE PRODUCTION IN TWENTY
TWO WAS REDUCED BY EIGHTY EIGHT
THOUSAND BARRELS PER DAY VERSUS
THE PRIOR YEAR THIS IS THE
EQUIVALENT OF A MID SIZED
REFINERY'S OUTPUT. WE THINK
THERE IS. GENERALLY ANOTHER WE
THINK THIS IS GENERALLY ANOTHER
COVERED HANG OVER BUT THERE ARE
OTHER FACTORS AS WELL. FOR
EXAMPLE GASOLINE IMPORTS WERE
LOWER THAN TWENTY TWENTY ONE
BECAUSE WHY A NEAR TRIPLING OF
FREIGHT RATES. THIS RESULTED IN
A STRONG INVENTORY DRAW TO
DECADE LOW RECORD DECADE RECORD
LOW LEVEL INVENTORY LEVELS.
CONSEQUENTLY SPOT PRICES ROSE
THE SUPPLY WAS TIGHTENED PUSHING
RETAIL PRICES UP IN AUGUST AND
SEPTEMBER. WE SEE THIS IS A
CAUTIONARY TALE ABOUT DEPENDING
ON LONG DISTANCE IMPORTS FOR
GASOLINE SUPPLY. RECOMMENDATIONS
INCLUDE THE ENERGY COMMISSION
NEEDS TO TAKE A SERIOUS LOOK AT
THE IMPACT OF LOCAL AND STATE
REGULATIONS ON THE VIABILITY OF
THE OIL INDUSTRY. AS WELL AS
REVIEW THE WORK THE COMMISSION
DID IN THE PAST IN THE SERIOUS
SPECIALLY. OF THIS WORK DONE
TWENTY YEARS AGO ON THE
STRATEGIC FUEL RESERVES AND
RELATED ISSUES. A COMPONENT OF
THE MYSTERY GUEST SURCHARGES
APPROACH PROFIT MARGIN THAT CAN
BE DEFINED AS THE DIFFERENCE
BETWEEN RETAIL PRICE AND
WHOLESALE ROCK PRICE. WATERS
ANALYSIS INDICATES THAT THIS IS
HIGHER THAN THE REST OF THE
COUNTRY BECAUSE OF A LACK OF
COMPETITION. ONE FACTOR IN THE
LACK OF COMPETITION AS THE
CALIFORNIA HAS TWICE AS MANY
LICENSED DRIVERS PER STATION
THAT'S THE REST OF THE COUNTRY.
REALISTIC ASSUMPTIONS AND HOW
FAST TRANSPORTATION ALTERNATIVES
CAN COME ONLINE ARE IMPERATIVE.
FOR EXAMPLE ACCORDING TO STORES
ANALYSIS OF A RP DATA. THE REAL
SUCCESS STORY OF THE L. C.
ADDRESS IS RULE DIESEL WHICH
MAKES UP ABOUT 39% OR DIESEL
ENERGY. WELL ELECTRIC VEHICLES
ONLY MAKE UP OF ABOUT 1% OF THE
GASOLINE POOL. WE ARE CONCERNED
THAT THE FUELS REFINERIES WILL
SHUTTER BEFORE THE TRANSITION IS
COMPLETE. LEAVING THE MARKET
IMPORT DEPENDENT. WE DON'T WANT
THE STATE'S ENERGY POLICY TO
EXPORT ITS STRATEGIC REFINING
CAPACITY TO ASIA PACIFIC FOR
EUROPE. BUDGET COLUMNIST TWENTY
TWENTY TO LECTURED ON THE
HISTORY OF PRICE CONTROLS. YES
SIR FINANCING HAD SIX LESSONS.
GETTING INTO CONTROLS IS A LOT
EASIER THAN GETTING OUT OF
CONTROL. NO MATTER HOW CLEVER
THE PRICE STRUCTURE FOR HOW BIG
HIS STAFF OR COMPUTER.
DISTORTIONS INEVITABLY RESULT.
CONTROLS THE GOT MORE CONTROL TO
CORRECT IMBALANCES CAUSED BY
PRICE CONTROLS MORE ELABORATE
CONTROLS ARE NEEDED TO CORRECT
THE DISTORTIONS. QUALITY
DECREASES WITH CONTROLS
SUPPLIERS SUBSTITUTE INFERIOR
PRODUCTS TO BEAT THE CONTROLS.
PRICE CONTROLS USUALLY INCREASED
. WELL CONTROLS HOLD DOWN PRICES
ARTIFICIALLY FOR A WHILE THEY
SOON START RISING OR SUMMER. AND
FINALLY VOLUNTARY CONTROLS
USUALLY GIVE WAY TO THE DOOR
CONTROLS. THANK YOU. THANK YOU.
NOW WE'RE MOVING TOWARDS A TO
OUR ROBERT CALL. AND THE. YOUR
TYPICAL RESEARCH AND HE'S UP
NEXT. I AM WAITING FOR THE
SCREEN ENSURING THAT SEEKS.
THERE WE GO. FOR YOURS. HELLO MY
NAME IS ROBERT MCCULLOUGH
FIREMEN AND CONAWAY'S STUDYING
THESE ISSUES FOR THE LAST DECADE
. WELL MY TESTIMONY THE U. S.
SENATE BRACKEN TWENTY TWO WAS
THE ONE THAT LAUNCHED THE ENRON
TRADING INVESTIGATIONS MY
TESTIMONY LATER THAT YEAR OF
MEDIA CALIFORNIA SENATE. WAS THE
FIRST DEALING WITH THE ACTUAL
MANIPULATIONS OF ENRON. I WAS
THE PRIMARY WE'RE NOT SHE HEAR
MEMBERS OF ST PROCESS CASE MOVES
BEEN WAGED AGAINST ME CALIFORNIA
REFINERS- I RESPECT I JUST HEARD
FROM BUT QUITE FRANKLY THEY'RE
MISSING THE BOTTOM LINE. THE
FACT IS THAT THE FOCUS INDEX
CRIMES. BOB POORLY UNDERSTOOD
ABSOLUTELY NOT TRANSAMERICA'S
NEST IS A CONTRACTUAL BASIS BUT
WHAT THE MIDDLE MAN AND THE GAS
STATIONS. THERE IS NO COMPLEXITY
TO THE- WELL ACTUALLY HAVE
CONTRACTS IT SPECIFIES THE-
INDEX. THAT'S ONE REASON WHEN WE
SIEMPRE SHARK COMMUNITIES FROM
SAN DIEGO TO SEATTLE WITH
ANOTHER. SO WHY IS IT WE HAVEN'T
TALKED ABOUT THIS BECAUSE DATA
AVAILABILITY IN CALIFORNIA IS
MINIMAL. THE ONLY EFFECTIVE-
OBLIGATION WE'VE HAD TO USE THE
SKV TALL CASE THAT IS A WASH
TRADE CASE. THAT IS ONE OF THE
ENRON SCHEMES THAT WAS
IDENTIFIED IN MY. TWO THOUSAND
TO HAVE SOMEONE IN THE U. S.
SENATE. WHY DO WE NOT HAVE THE
UP BUT WE DON'T HAVE RULES AND
REGULATIONS TO BRING THAT DATA
TO THE CORE ONE OF THE SENATORS
HOUSE. WELL FOR. THERE'S ONE
CURRENCY AND OTHER FUELS THE
ANSWER IS NO EVERY ELECTRICITY
CONTRACTORS REPORTED THE BURKE
IN CAN BE LOOKED UP AFTER A
SHORT DELAY. ON THEIR WEBSITE.
WE DO NOT HAVE THAT WITH THE
GASOLINE OR- SO IT WILL US
SENATOR CANTWELL ONCE REMARKED
WE KNOW MORE ABOUT SOYBEANS THAT
WE KNOW ABOUT OIL AND GASOLINE.
GOING TO THIS QUESTION OF THE
CRITICAL OPEN INDEX. IDENTIFIED
THE US CONGRESS IN MARCH IN
APRIL. YEAH THE CRITICAL INDEX
NOW WE'RE TALKING ABOUT
SOMETHING LIKE THE DOW JONES
INDUSTRIAL. IS NOT CHANGED
CRUISING A WEEK. THEY ARE NOT
CHANGE ORDERS SLIGHTLY DIFFERENT
PRICE FOR THE FOLLOWING WEEK.
REALLY OFFICE MATERIALS ARE THAT
PERIOD INDICATED THAT ALL
QUESTIONABLE RECEIVED ONE FREE.
FOR TO BELIEVE CURRENT. NUMBER I
HAVE A SPIKE IN PRICES OUT.
CALIFORNIA THAT WAS QUITE
REMARKABLE. THOSE ARE THE ISSUES
WE HAVE TO GET DOWN TO ITS
FUNCTIONS PARTICULARLY VITAL
LONG TERM SUPPLY AND DEMAND.
THIS WERE VERY MUCH ALIKE
WONDERING ABOUT HOW YOUR NEW CAR
WILL WORK BUT THE CAR WE'RE
DRIVING IS WEARING OFF A HIGHWAY
AND WE HAVE TO GET DOWN TO THAT
PLEASE STAND UP. NINE SEVEN
BANNERS I WENT THROUGH THE THREE
AND A HALF MILLION DOCUMENTS WE
HAD IN THEIR LIFE CLUSTERS I
HAVE ACCESS TO MANY MORE. BUT I
VERY MUCH FOR ISSUE ON THE
FRANKLIN YOU NEED TO SOME NOW.
NOT TO EMERGE BECAUSE YOU'RE
RUNNING. HAVEN'T GOT VERY FAR
I'M GONNA GO TO THE NEXT SLIDE
STUDENTS ARE OBVIOUSLY IGNORED
MY SLIDESHOW TO RESPOND TO MANY
OTHERS SPEAKERS. THE BOTTOM LINE
IS THIS THE PRICES ARE SET. UP A
PIPELINE IN LA. THEIR
ADJUSTMENTS TO GO TO SAN.
PORTLAND AND SEATTLE BUT THAT IS
WHERE THE PRICES ACTUALLY SAID.
IT WAS CLEAR MARKET VIEWS SELF
REPORTED COURAGE AND AS I
NOTICED. IN TWO WEEKS BOB FIRE.
THERE WERE ONE PREVERBAL. WHICH
OF COURSE KNOW IS. THERE IS NO
OF THREE WILL BE OF THIS MARKET
PRICE AS AS I KNOW NO FEDERAL.
AGENCIES SUBSCRIBERS TO HOPELESS
. I AM NOT AT ALL SIR. THAT
CALIFORNIA AGENTS SUBSCRIBES
MOROCCO'S MAY WELL BE- SWOT
REYES KNOW OVER. TO THE CAR
BRAVA. WE DON'T HAVE A REASON
HIGH. AND WE EVER HAVE. READ LOW
PRICE. WE A LITTLE BIT ABOUT
SOME OF THE BIKES IN THE AREA I
ACTUALLY REVIEWED OPENS ON THAT
. RUBIO WAS THE LONE AT LEAST AS
VERY HISTORY CRIMES. SO BOTTOM
LINE IN ALL THE YEARS U. S. ONE
NAY TO OCCUR THE COURT OF.
EQUITY IT PUT ELEMENT BRYCE
GOUGING. IT'S IS WHERE- NUMBER.
THE WAY THE REST OF THE ECONOMY
WORKS WITH THERE IS INFORMATION
ON OPERATIONS PRICES AND MARKETS
POWER. CHAU HAVING TOTALLY
BOUNCED OUT AMONGST A LARGE H.
B. WE HAD SEVERAL OTHERS HERE
THAT AWAYS FROM OUR RESEARCH.
THE MARGIN FOR WHOLESALE WAS THE
HIGHEST OF ALL THE CHANGES TO
ITS ON TWENTY TWENTY TWO HELLO
THAT SOUNDS PRETTY AMAZING THE
CHANGES MARGIN WORK SOME OF THE
OTHER CHANGE. THE ALSO MARGIN
CERT SURGERY AWKWARD BY FORTY
SIX POINT 8% WHY THEN I AM.
TRANSPARENCIES G. BUT IF WE ARE
GOING TO KNOW WHAT HAPPENED WE
CERTAINLY NEED TO BE ABLE TO
RECOVER THOSE COSTS BACK TO THE
CONSUMER- YIELD THE FLOOR. THANK
YOU MISS RECALL AND NOW LAST BUT
NOT LEAST WE HAVE MICHAEL
MEACHER PROFESSOR OF MANAGEMENT
ORGANIZATION AT USC MARSHALL
SCHOOL OF BUSINESS. THANK YOU
MISTER CHAIRMAN OF DISTINGUISHED
SENATORS THANK YOU SO MUCH FOR
THE INVITATION TO SPEAK WITH YOU
TODAY. IT IS QUITE AN HONOR TO
BE HERE. REALLY IS IT IT'S A
THRILL TO BE WITH. THE STEAM TO
. EXPERTS AND- YOU KNOW SORT OF
THINK ABOUT THE ONE MOMENT THAT-
FUMAN DON'T MIND DAY- I CAME TO
CALIFORNIA AS A AS AN INFANT.
OFF THE BOAT. BECAUSE I WAS BORN
IN JAPAN. SO I STEPPED INTO
CALIFORNIA OVER WHICH CARRIED IN
THE CALIFORNIA AT FORT MASON.
SAN FRANCISCO SO I WOULD THINK
IT'S KIND OF PRETTY NEAT RIGHT
NOW TO BE SITTING AHEAD OF IT IN
FRONT OF THE ESTEEMED SENATE OF
CALIFORNIA COMMITTEE ON. ON
ENERGY SO LET'S JUST GET RIGHT
TO IT THANK YOU. FANTASTIC
REALLY FANTASTIC TESTIMONY
FANTASTIC INSIGHTS. LET ME JUST
SORT OF GET RIGHT TO THE CHASE
WITH TODAY THAT THE COST OF
GASOLINE CALIFORNIA PRICE
GASOLINE CALIFORNIA'S FOUR
DOLLARS AND THIRTY FOUR CENTS. A
GALLON ON AVERAGE FOR REGULAR IN
THE UNITED STATES GENERALLY A
NON ADJUSTED FOR CALIFORNIA AS A
PROFESSOR BORNSTEIN WOULD DO IS
THREE DOLLARS AND FORTY FOUR
CENTS THREE ON THREE DOLLARS AND
FORTY NINE CENTS. SO YOU KNOW WE
HAVE A 36% PREMIUM AND WE'RE
CONDITION PAYING THIS PREMIUM
THIS PRINTER GOES ALL THE WAY
BACK TO THE NINETEEN EIGHTIES AT
LEAST IN MY RESEARCH WHICH GOES
BACK FORTY PLUS YEARS. SO WE'VE
ALWAYS HAD A PREMIUM CALIFORNIAN
AND EVEN PRESIDENT JOE BIDEN
NOTICED THAT IN AND COMMENTED ON
IT ON HIS TRIP TO. LOS ANGELES
OVER THE SUMMERS AS WELL IT'S
ALWAYS BEEN THAT WAY WHAT HAS
AND THERE'S A LOT OF REASONS FOR
MOST OF IT HAS TO DO WITH OUR
REGULATORY ENVIRONMENT. OUR
INITIATIVES FOR- CLEAN ENERGY
CLEAN AIR CLEAN HEALTH. ALL
THOSE GREAT THINGS THAT WE DO
PLUS WE HAVE HIGH DEMAND. I MEAN
LET'S FACE IT. WE'RE THE FIFTH
LARGEST ECONOMY IN THE WORLD
RIGHT NOW. FORGED IN GERMANY.
OKAY SO. WE HAVE A LOT OF
FACTORS- SENATOR STERN. IF YOU
DON'T MIND. ONE OF THE ONE OF
THE THOUGHTS AND INTO IN ONE OF
YOUR QUESTIONS BROUGHT ME TO THE
IDEA OF WHEN I WAS- ACTUALLY
FILLING UP GAS. OVER THE SUMMER
AT IT PLEASE CULTURE. WELL IN
PASADENA AND A LADY WAS- WOMAN
WAS FILLING UP HER SUV ABOUT A
HUNDRED TWENTY DOLLARS WORTH.
AND SHE SAYS NO I CAN'T AFFORD
TO BRING MY KIDS TO CHUCKY
CHEESE ANYMORE. THIS WHO WERE
FACING. ISRAEL SHIPS. WE NEED TO
HAVE SERIOUS DISCUSSION OF WHICH
WERE HAVING AND WE NEED GREAT
IDEAS FOR IT. SO LET'S GET TO
THE PRICE GOUGING. PENALTY
ALRIGHT SO WHAT IS IT REALLY
WON'T. CALL WE WILL TO CALL IT.
MOST ECONOMY WILL CALL WHEN FALL
PREY TAX. BECAUSE IT'S IN
ADDITION. TAX SUPPORT. LEVIED ON
PROFITS THAT ARE DEEMED BY SOME
GOVERNING PARTY TO BE EXCESSIVE
IN ABOVE AND BEYOND TO
ARBITRARILY DETERMINED AND
SPECIALLY DEFINED THRESHOLD.
OKAY THAT'S WHAT IT IS NOW IN
AND OF ITSELF. THAT'S
INTERESTING SO WE HAVE SOME
DEFINITION FOR. BUT THE QUESTION
IS. ONE IS A WIN FOLLOWING FALL
. EFFECTIVE FOR REFINERY
PRODUCER ANY BUSINESS INVESTS
SIGNIFICANTLY IN TECHNOLOGY
INVEST SIGNIFICANTLY IN THEIR
OPERATIONS AND HAS GREAT
MANAGEMENT MANAGEMENT AND
IMPROVE THEIR OPERATING MARGINS
RELATIVE TO THE PRICE. THEY'RE
GOING TO GENERATE A HIGHER
PROFIT. CALLED COMPETITION. IT'S
ALSO CALLED INVESTING IN
INNOVATION SO. SIMPLY JUST
LOOKING AT THIS. GROSS PROFIT
MARGIN IS ENTIRELY INCOMPLETE IN
. REALLY MISSPENT EFFORTS OKAY.
THE IDEA BRANDED VERSES
UNBRANDED YEAH WE HAVE
DISPROPORTIONATE BRANDED GAS IN
CALIFORNIA DEBTS WHAT THE
CONSUMER WANTS. THE BY BRANDED.
GASOLINE WHY BECAUSE THEY HAVE
CONFIDENCE IN IT IS CONSISTENCY-
PRODUCT AND A LOT OF THESE
COMPANIES HAVE AFFINITY PROGRAMS
. SO WE HAVE A LOT OF QUESTIONS
HERE THAT WE HAVE TO ASK YOU
KNOW IS THE PROFIT INCREASE DUE
TO CAPITAL INVESTMENT. OR IS IT
ASSOCIATED WITH. MARKET FACTORS
IN MOST OFTEN IT'S GOING TO BE
ASSOCIATED WITH THE DYNAMICS OF
THE MARKET. YOU KNOW BUT THE
IDEA THAT THESE COMPANIES. YOU
WON'T COMPANIES AND REFINERS.
ARE ENGAGING IN EXCESSIVE
PROFITS THAT THRESHOLD HAS NOT
BEEN MET. IT HASN'T BEEN PROVEN
. OKAY EITHER IN THE UNITED
STATES OR ELSEWHERE COUNTY
SYSTEM ATTORNEY GENERAL GIVE US
A GREAT RECAP ON THE LAST YEARS.
IN FACT. YOU CAN MUCH TIME BUT
IN WE HAVEN'T PROVEN ANY CASES
OF PRICE GOUGING NOR HAVE WE
PROVEN ANY CASES OF. COLLUSION
WHAT WE HAVE BEFORE SO IS AN
EXTRAORDINARILY INTERESTING CASE
IN SAN FRANCISCO I'M GOING TO
WATCH VERY CLOSELY BECAUSE
THAT'S WHAT THE TRADING LEVEL
THAT MAKES SENSE TO US IS
RECENTLY IS NOVEMBER WE HAD A WE
HAD A COURT CASE IN US DISTRICT
COURT IN SAN DIEGO. HUNDRED
THREE PAGE REASONED JUDGMENT
COSTING OUT THE CASE FOR ALLEGED
PRICE FIXING. AND THIS GOES ON
AND ON WE HAD THE FEDERAL
RESERVE LOOK AT IT AND- YOU KNOW
AT LEAST NINETEEN TEN WE'VE HAD
DIFFICULTY PROVING THIS ALONG
WITH THE FTC. SO QUITE
INTERESTING SO WHAT'S THE RESULT
. OF THIS WORLD. THE MOTOR FOR
THIS. IN ORDER SKINNER I FULLY.
AND I ABSOLUTE SUPPORT YOU. WE
NEED TO BRING THIS PRICE DOWN.
NO QUESTION WERE SO. BUT WHAT
HAPPENED WHEN WE TRIED IN WE
TALK ABOUT IF YOU QUESTIONS
ABOUT. EUROPE UNPREPARED INTO
THOSE. THE IDEA OF THIS. EMILY
TAXES WHEN PAUL PROFIT TAX NOT
NEW IT GOES BACK TO ABRAHAM
LINCOLN. BLINKING ACTUALLY
IMPOSE SOMETHING SO TO THIS. AND
MORE PROFITEERING. WE SAW EIGHT
EIGHT GREAT EMPHASIS ON THIS IN
NINETEEN SEVENTY WITH WORLD WAR
. MOST RECENTLY AT LEAST IN IN
MY- WAS THE BAKUL THE
NINETEENTH. IN THE ORLAND WHICH-
IN NINETEEN SEVENTY THREE. SO
HERE'S WHAT HAPPENED WHEN WE
IMPLEMENTED. WE IMPLEMENTED OUR
- THE VARIATION OF THIS KEEP IN
MIND THERE'S NO DE FACTO
STANDARD. THERE'S ALL SORTS OF
DIFFERENT MODELS AND VARIANTS TO
THIS SO IT'S NOT LIKE WE HAVE A
PARTICULAR. EIGHT NAY HAPPEN LET
IT HAPPEN ELEVEN PIECE OF PAPER
THAT WE'RE WORKING WITH. THERE'S
JUST CONCEPTS ASSOCIATED WITH
IT. BUT HERE'S WHAT HAPPENED
WHEN WE PUT THIS TOGETHER
CORRECTION RESEARCH SERVICE
FOUND IN THE NINETEEN EIGHTY
STUDY ONE. IT ONLY IT ONLY
GENERATED 20% OF ITS EXPECTED
REVENUES. TWO WE HAD TO DOMESTIC
PRODUCTION FALL BY FOUR POINT
EIGHT PERCENT. THREE WE
INCREASED OUR DEPENDENCY ON
FOREIGN OIL BY TWELVE POINT
SEVEN PERCENT. FOUR WE REDUCED
INVESTMENT IN CAPACITY FIVE IT
ABSOLUTELY DID MINIMAL LITTLE
MEANINGFUL REDUCTION IN RETAIL
GASOLINE PRICES. AT THE PUMP.
NOW THIS GOES ON IN EUROPE WE'RE
SEEING THIS BEING IMPLEMENTED.
BY COUNTRIES LIKE BELGIUM THE UK
. ITALY GERMANY FRANCE POLITICOS
ON BUT WHICH HE READ DEEPLY.
DEEPLY YOU HAVE TO GO INTO THE
SUBTEXT. THE APPLICATION OF THIS
TAXES ALL OVER. ALL OVER THE
SUPPLY CHAIN SO THERE ISN'T ANY
CONTINUITY TO IT NUMBER ONE. AND
NUMBER TWO IT'S NOT GOING BACK
TO THE PEOPLE WHO PAID OVER OVER
GALGIANI. OKAY WHAT THEY'RE
REALLY DOING WITH THIS INSTANT
CAREFULLY STUDY BY A FEW LAW
FIRMS IN EUROPE. IS THAT THE TAX
. IS BEING. REDISTRIBUTED FOR
SUSTAINABLE ENERGY PROJECTS.
IT'S REALLY A FUN VEHICLE FOR
THAT. SO BOTTOM LINE. FOR TAKE
ONE LAST SECOND SURPLUS SECOND
ONE MORE SECOND. THIS IS A GREAT
IDEA. BUT IT WON'T WORK. K. THIS
COMPELLING EVIDENCE IT WON'T
WORK. SO I THINK WE NEED TO TAKE
HER EFFORTS WHICH ARE
CONSIDERABLE. AND LET'S PLAY
SOME INTERNET THAT CAN BRING
DOWN THE TAP CAN BRING DOWN THE
PRICES. MOST OBVIOUSLY IN SUPPLY
OKAY THANK YOU THANK YOU HARMON
OPEN UP TO THE MEMBERS WHO HAVE
QUESTIONS- WE HAVE SENATOR
GONZALEZ SENATOR STERN SO
SENATOR INTO. OF THANK YOU VERY
MUCH MISTER CHAIR- I APPRECIATE
THIS PRESENTATION HOWEVER- I
JUST HAVE A FEW QUESTIONS TO ASK
OF SOME OF OUR PANELISTS HERE-
FIRST AND FOREMOST ON THE ON-
MISTER ME SHE WILL START WITH
YOU- FIRST I WANT TO GET CLEAR
HERE. ON JUST A LITTLE BIT OF
YOUR BACKGROUND. YOU LIST ONE OF
YOUR CLIENTS AS THE SAUDI
ARABIAN PATRISTIC GOVERNMENT IS
THAT CORRECT YES WE DO WORK FOR
THEM SEVERAL YEARS AGO. AND YOU
ALSO WROTE A PAPER AND- TITLED
WHEN IT COMES TO ENERGY THE
STUPIDITY OF THE BY
ADMINISTRATION KNOWS NO END WELL
YES I DID RIGHT ALL RIGHT. SO I
DIDN'T HEAR IN YOUR TESTIMONY.
ANY REAL ANSWERS TO BE QUITE
HONEST ON WHAT. I MEAN ASIDE
FROM THE ENVIRONMENTAL
REGULATIONS AS EVERYONE HAS BEEN
SAYING WE KNOW THAT CRYSTAL
CLEAR THAT IT'S CRYSTAL CLEAR
THAT IT'S NOT THE ENVIRONMENTAL
REGULATION. I DON'T. HEAR AN
ANSWER A THOUGHTFUL ANSWER ON
WHY. CALIFORNIANS ARE PAYING.
SUCH HIGH GAS PRICES. OVER THE
LAST. YOU KNOW LAST FALL WAS A
GREAT QUESTION- AND I CAN THINK
HOPEFULLY I CAN ANSWER THAT FOR
YOU. WHEN WE TAKE A LOOK AT THE
CALIFORNIA GAS PRICES- IS
PERCENT PROFESSOR BORNSTEIN SAID
. IT'S NOT AT THE REFINERY
LEVEL. THE SPREAD BETWEEN
REFINERY COSTS AND ALSO COST IS
MY NEW. EXCEPT DURING PARTICULAR
PERIODS OF STRESS AND IF YOU
TAKE A LOOK AT- ONE OF OUR
EXHIBITS. THAT WE HAVE FOR YOU
YOU CAN SEE THAT REPRESENTATION.
IN THAT WOULD BE ON PAGE. FIRST
SLIDE THIRTEEN SO WE CAN SEE THE
VERY VERY CLOSE CORRELATION FOR
THAT. IF THE COST IS A BUILD UP
. THAT'S WHAT I THINK AND I
THINK THAT'S WHAT PORN SCENES
TELLING US TO WHAT IS THE
EVIDENCE TO PROVIDE. THAT ANSWER
IT IS IT IS IT'S A CUTE TO BUILD
UP. SO IF WE TAKE A LOOK IF WE
TAKE A LOOK AT SLIDE NUMBER FIVE
I'M SORRY SLIDE NUMBER SIX. WE
SEE THE- COMPARISON BETWEEN THE
NATIONAL AVERAGE AND THE
CALIFORNIA AVERAGE BUT THEN IT
JUST A SIMPLE DESCRIBED. WHERE
WE TAKE THE NATIONAL AVERAGE WE
TAKE A CALIFORNIA RIDGE AND WE
BACK OUT FEDERAL TAXES WE BACK
OUT. IN AS SOON TERM BUT TEN TEN
CENTS A GALLON. AT THE GAS
STATION LEVEL FOR PROFIT AND
THEN WE BEGIN TO TAKE OUT ALL OF
THE CALIFORNIA CHARGES. IN SO WE
RECONCILE TO WITHIN 96% OF THE
OF THE NATIONAL AVERAGE SO WHAT
WE'RE REALLY LOOKING AT. IS A
LOT OF REGULATORY OVERHEAD. IT
GETS BUILT IN AND PUSHED. AND
LAYERED. ALL WAY TO THE END OF
THE PUMP. SO THROUGHOUT THE
PROCESS WHICH LOOKS LIKE THIS.
WHAT PROFESSOR BORNSTEIN IN
FIFTH PROFESSOR SWINTON SAID IN
WHAT MY RESEARCH INDICATES. IS
THAT. THE LEGISLATION WE'RE
CONSIDERING IS UP HERE. BUT THE
SPREAD IS REALLY SOON AND IT'S
REALLY NOT GOING TO GENERATE.
ANY SIGNIFICANT MONEY. THE COSTS
THIS MYSTERY SURCHARGE HAS
REFERRED TO OCCURS DOWNSTREAM.
IS HERE IT'S THE LAYERING OF THE
COST AS PRODUCT MOVES THROUGH AN
ULTIMATELY WHEN SOMEBODY'S
RUNNING A GAS STATION SENATOR
THEY HAVE TO PAY THEIR UTILITIES
THEY HAVE TO PAY THE RENT THEY
HAVE TO PAY THEIR TAXES. THEY'RE
GONNA LOAD UP. OKAY WELL I THANK
YOU FOR THAT ANSWER NOT
NECESSARILY THAT I AGREE OR I
THINK THAT'S CRYSTAL CLEAR FOR
FOLKS I STILL FEEL LIKE YOU KNOW
THERE'S LOTS OF QUESTIONS THAT.
NEED TO BE ANSWERED THE DATA THE
TRANSPARENCY NEEDS TO BE DONE
AND WE CERTAINLY DON'T HAVE THAT
SO I WILL- THE NEXT QUESTION I
HAVE REAL QUICKLY IS FOUR MISTER
JORGENSEN AND THE AG'S OFFICE
THANK YOU FOR YOUR- TESTIMONY AS
WELL YOU HAD. TALKED ABOUT
OBVIOUSLY THE ANTI TRUST. ISSUES
THEN YOU KNOW YOU'RE YOU'RE
FOCUSED ON A LOT OF THAT WITH A
MULTI STATE STAKEHOLDER GROUPS
WHICH IS FANTASTIC BUT- A LOT
MORE IS NEEDED. IT IN ORDER IN
IN TERMS OF STAFFING AND JUST
RESOURCES TO BE ABLE TO. TAKE UP
TAKE THIS ON AN ADDITIONAL
OVERSIGHT SO WHAT WOULD THAT
LOOK LIKE FOR. THE AG'S OFFICE
AND HOW WHAT ELSE CAN WE DO TO
PROVIDE ADDITIONAL OVERSIGHT FOR
CALIFORNIANS- WITH US THROUGH
THE BUDGET PROCESS- GIVE ME
NUMBERS AND WE WANT NUMBERS ONE
SPECIFIC. OUTLOOK OKAY WELL I
DON'T HAVE THOSE BUDGET CHANGE
PROPOSALS IN FRONT OF ME THEY
ARE- THIS IS PART OF THE US
SUPREME FINANCE LETTER AND
BUDGET CHANGE PROPOSAL PROCESS.
THANK YOU ARE VERY CLEAR THAT
THE FREE SHE SAID WE WOULD HOPE
THAT THERE IS MORE OVERSIGHT IN
THE SPACE THAT YOU'RE ABLE TO DO
THAT SO THANK YOU. THANK YOU
MISTER CHAIR THANK YOU SENATOR
NEXT UP SENATOR STERN. THEMES
CHAIR I'LL I'LL JUST- BUILT ON I
GUESS THE- INITIAL LINE OF
QUESTIONING FROM MY COLLEAGUE
HERE AND- MAYBE ASK IT A LITTLE
SIMPLER JUST ONE QUESTION FOR.
THE WHOLE PANEL AND YOU ALL CAN
. JUSTANSWER SHOULD BE JUST A
YES OR NO BUT WHAT WE'RE TRYING
TO ESTABLISH SORT OF. ARE THE
STAKEHOLDER PERSPECTIVES ARE
EXPERT PERSPECTIVE THAT MY
UNDERSTANDING IS THIS PANEL
SUPPOSED TO BE AN- INDEPENDENT
EXPERT WITNESSES. BUT BASED ON
SOME OF THE CLIENT HISTORY I
GUESS. MY QUESTION IS HAVE HAVE
YOU EVER. RECEIVED INCOME OR OR
OTHER COMPENSATION FOR YOUR WORK
FROM THE OIL INDUSTRY OR FROM
FOREIGN GOVERNMENTS THAT- THAT
RUN OIL COMPANIES. SO JUST A YES
OR NO. I CAN START NOW OKAY JUST
THE STATE OKAY. NO HERE- BUT I
DID NOT TO WORK IN THE OIL
INDUSTRY THAT'S OKAY YES OR NO
IT'S FINE SO YES YES OKAY.
BERMAN BIGELOW NO. K. I HAVE NOT
SINCE NINETEEN NINETY BUT I DID
BACK IN NINETEEN NINETY BRIEFLY
WORK ON A CASE. YES THAT'S
DOCTOR WON'T SEE THANK YOU. AND
I DON'T AND I'VE BEEN AND I'VE
BEEN PAID. FOR LITIGATION I'M ON
EITHER SIDE OF THAT SOMETIMES
AS- SOMETIMES WORKING WITH THE
OIL COMPANIES SOURCE THAT'S
PROFESSOR SWEENEY AS A YES YOU
HAVE BEEN PAID BY THE OIL
INDUSTRY. IT'S PAST MY LIFE YES
YES OKAY. AND LASTLY. THE STATE
PACKET THE STORE'S BEEN RETAINED
BY A WIDE RANGE OF CLIENTS
BECAUSE OF OUR DEEP EXPERIENCE
IN THE SPACE. CLIENTS TRUST US
TO PROVIDE THOUGHTFUL OBJECTIVE
ANALYSIS OF MARKET RECORD SHOULD
REGULATORY ISSUES. YES WE'VE
BEEN RETAINED BY THE REFINERS
BUT ALSO BY THE ENERGY
COMMISSION INDEED WELL IN THE
PRIMERA QUIZ FORMED- THAT WAS.
THE THREE EMINENT ENERGY
ECONOMISTS THE ASSISTANT
ATTORNEY GENERAL FOR ANTITRUST
FAMILY CALLED ME. HI CYBILL.
WHAT DO YOU WANT ME ON THE
COMMITTEE AND THE ANSWER WAS NOT
TO SO MANY VETS HAVE CERTAINLY
KNOWS WHAT THEY'RE TALKING
ABOUT. I APPRECIATE THE INSIGHT
I YOU JUST YOU DIDN'T MENTION
THAT YOU HAD OIL INDUSTRY
CLIENTS THAT THE OUTSIDE OF YOUR
TESTIMONY SO JUST ASK THAT'S A
YES AS WELL- NO FURTHER QUESTION
. THANK YOU SENATOR ASHLEY.
THANK YOU VERY MUCH CARE
BRADFORD AND ALSO LET ME JUST
START BY ADDING MY THANKS TO THE
CHAIRMAN. OF THE I THINK I'M THE
ROOKIE ON THE COMMITTEE AND THE
FRESHMAN SO NO HAZING. AND THAT
YOU KNOW HONORED TO BE HERE TO
AND TO HEAR THAT TESTIMONY AND
SORT OF WAY THROUGH IT I'M-
READING THE PAPER WORK AS FAST
AS I CAN AND I APPRECIATED THE
BACKGROUND INFORMATION. PROVIDED
THAT SAID THIS IS SORT OF MY
QUESTION FORGIVE ME FOR WORKING
MY WAY THROUGH IT TO YOU. BUT WE
HEARD ON THE FIRST PANEL AND
WE'VE HEARD EVERYONE HAS HEARD
OVER TIME THE GOVERNOR'S. LAN
AND THE NEXT. GROUP IS SUPPOSED
TO BE STAKEHOLDERS ALTHOUGH. I
UNDERSTAND THERE ARE SOME
STAKEHOLDERS HERE TOO BUT
THEY'RE ALSO PROFESSORS AND-
AND- MEMBERS OF THE STATE TEAM
HERE SO IT'S A BIT MORE OF A
MIXED CROWD. SO WE'VE ALSO HEARD
THOUGH FROM THE SENATOR'S.
UNIFORMLY IN FACT I BELIEVE I'M
THE ONLY ONE THAT DIDN'T SPEAK.
DURING THE FIRST PANEL. AND THEY
WERE. SORT OF UNANIMOUSLY
CONCERNED ABOUT RELIEF AT THE
PUMP DIFFERENT WAYS OF
APPROACHING IT BUT THEY ALL
TALKED ABOUT THAT. AND WHILE I
APPRECIATE THE STORY OF THE MOMS
. HI MOM HAVE BEEN FOR A REALLY
LONG TIME. THE COULDN'T TAKE HER
KIDDOS TO A FUN PLAY. DAY I
THINK WE'RE A LITTLE BIT MORE
CONCERNED ABOUT NOT BEING ABLE
TO MAKE IT TO WORK. FOR THE
HOSPITAL FOR CHILD CARE- BERNABE
RESPECT. BUT WE'VE HEARD FROM
THE GOVERNOR AND WE'VE HEARD
FROM THE SENATORS AND WE'VE
HEARD FROM SOME STAKEHOLDERS AND
WE'VE- HEARD FROM SOME
PROFESSORS AND EXPERTS IN THE
AREA. AND I YOU KNOW SENATOR
DRAWS SO REALLY WALKED US
THROUGH REMINDED US OF FORTY
YEARS OF DISCUSSIONS THAT HAVE
HAPPENED ON THIS TOPIC. AND YET
WE STILL FIND OURSELVES HERE
HAVING THE CONVERSATION AGAIN.
AND SHE POSED WHAT I THINK IS
REALLY THE CRITICAL CONVERSE IN
THE CRITICAL QUESTION HOW DO WE
MAKE THIS CONVERSATION HAVE A
DIFFERENT OUTCOME. THAN THE
FORTY YEARS THAT HAVE PRECEDED
US HERE. WHICH MAKES IT SORT OF
THE QUESTION THAT I WOULD LIKE
TO ASK AND IT'S REALLY DIRECTED
LESS AT THE TO STATE EMPLOYEES
AND MORE AT THE REMAINDER. OF
THE PANEL. IF NOT THE GOVERNOR'S
PRICE GOUGING PENALTY AND
TRANSPARENCY PLAN. THEN WHAT
MODEL DO YOU PROPOSE. YOU ARE
THE EXPERTS. IF YOU'RE GONNA
CALL ON PEOPLE OF WHAT. EARLY
THAT TO THE CHAIR ALL RIGHT
WHO'S SHOULD PREPARE TO ANSWER
THE QUESTION. PROFESSOR SWEENEY
GARRATT IT. I'M MORE IN DOING.
AS QUICK AS ONE POSSIBLE. THE
ONLY PROPOSAL BUT I'VE BEEN. I
HAVE BEEN ABLE TO ENVISION THAT
WOULD USUALLY BE SUCCESSFUL OF A
TIME IS NOT ONE OF THESE TAX
GIMMICKS. BUT SOMEHOW CREATING
MORE COMPETITION FROM OTHER
STATE I'M MORE ABILITY TO BRING
BRING- GASOLINE IN. AT A
MOMENT'S AT A MOMENT'S NOTICE
SO- WEEKS DOLLARS FROM OTHER
PLACES THAT. UNFORTUNATELY I
DON'T HAVE THE ANSWER THAT THE
JONES ACT THAT GETS IN THE WAY
THAT THE LACK OF PIPELINE THAT
SOMETIMES GETS IN THE WAY AND AS
I'M BY MENTAL WHO ARGUE LIKE
SHOULDN'T THAT MAKE CALIFORNIA
AN ISLAND I THINK THAT THERE HAS
TO BE SOME IN BETWEEN TRADEOFFS.
THAT MAY HAVE ONLY LITTLE IMPACT
ON THE ENVIRONMENT AND
SIGNIFICANT IMPACT AND CREATING
COMPETITION FROM OTHER STATE
BECAUSE I DON'T THINK WE'RE
GOING TO SOLVE IT G. AS
PRODUCTION IN STATE WHEN. THE
INDUSTRY'S CONTINUED TO DIE.
THANK YOU ANYONE ELSE TO ONE
CENTER THAT'S BEST PROFESSOR
BORNSTEIN AND THEN YEAH I THINK
THE MOST IMPORTANT PIECE OF THIS
PROPOSED LEGISLATION IS WHAT'S
BEING CALLED TRANSPARENCY BUT
WHAT I'D CALL INVESTIGATION- I
THINK THAT THE LEGISLATURE HAS
TO PUT FORWARD SOME REAL
RESOURCES TO DO DEEP. DIVE OF A
DEEP INVESTIGATION JUST TO BE
CLEAR THE P. MAC WAS FIVE ALL IN
TEARS WHO MET QUARTERLY AND GOT
LESS THAN ONE HALF OF ONE PERSON
IN STAFF SUPPORT. OF COURSE IT
DIDN'T ACCOMPLISH ANYTHING- AND
GO HAD NO ACCESS TO DATA. IF YOU
REALLY WANT TO GET SOMETHING
DONE I THINK THE SORTS OF
MILLIONS OF DOLLARS THAT THE
PERSON FROM THE ATTORNEY
GENERAL'S OFFICE TALKED ABOUT IS
WHAT IT'S GOING TO TAKE TO DO A
DEEP INVESTIGATION. THEY CAN
ACTUALLY LOOK AT WHERE THE
PROBLEM IS AND IT'S PRETTY CLEAR
THE PROBLEM IS DOWNSTREAM. AND
COME UP WITH POTENTIAL
REGULATORY FIXES I KNOW THAT
LEGISLATORS DO NOT WANT THE
ANSWER- WE NEED MORE
INVESTIGATION BUT THE FACT IS
SHOOTING FIRST AND THEN FINDING
OUT IF IT'S THE RIGHT SOLUTION
IS GOING TO IS LIKELY TO BE JUST
AS DETRIMENTAL AS HELPFUL. THANK
YOU MISS RECALL. THREE BILLION
STREET LIGHTS IS THE- BECAUSE
CRIME THE DIMINISH. THE OTHER
RESTAURANTS. WHAT WOULD HAPPEN
IF WE ACTUALLY MADE THE
TRANSACTIONS PUBLIC. THE REPORT
OF THE INDUSTRY FOR A LONG TIME
YOU KNOW THAT THE REFINERIES
CARE VERY HIGH LEVELS OF DATA ON
EACH OTHER. THEY HAVE. BEEN
FIFTEEN THREE MONTHS BELOW THE
REVIVALISTS OF MARKET PRICES AND
SOME LOSERS. THEY HAVE RATED
CATIONS THAT ARE CONSTANT AND
ONGOING. THE ONLY PEOPLE WHO DO
NOT HAVE THAT INFORMATION IS US
. SO A GOOD FIRST STEP IT IS
SIMPLY TO TAKE. THEY ARE.
BLANKET OFF THE MARKET. THERE IS
NO PARTICULAR REASON WHY FIELD
WITH TRANSACTION AND SHOULD NOT
BE MADE PUBLIC. IN FACT THEY ARE
EFFECTIVELY PUBLIC BECAUSE ANY
PLAYER IN THAT MARKET. CAN
RECONSTRUCT FROM FROM THE OPEN
STATE. AND ONCE YOU HAVE THAT
YOU'RE GOING TO ELIMINATE ONE
HOLD SKILL OF PROBLEMS. THANK
YOU. DISTRACTED. THANK. I GO
BACK TO MY TALK WITH ISSUES
INCLUDE EVERYDAY HIGH GAS
PRICES. AND THEN PRICE SPIKES
DUE TO OUR REFINERIES USING
GEOGRAPHIC ISOLATION. AND THEN
FINALLY AND SO THAT'S WHAT. WHAT
THE WHAT GERMAN SEVERNA TALKING
ABOUT AND YOU KNOW- INTERESTED
MORE COMPETITION. COMPETITION AT
THE RETAIL LEVEL COMPETITION OF
THE REFINING LEVEL ALL THAT'S
GOOD FOR COMPETITIONS BUT- DON'T
DISCOURAGE COMPETITION. SO
DISCOURAGED BUILDING THE GAS
ISSUES I MEAN I ARGUE THAT THERE
AREN'T ENOUGH GAS STATIONS. AND
THAT'S ONE OF THE REASONS THE
PRICES ARE SO HIGH. DON'T
DISCOURAGE COMPETITION THE
SECOND THING IS PRICE SPIKES
WILL DEAL WITH PRICE SPIKES
THAT'S A SEPARATE EXERCISE IT'S
KIND OF A TEMPORARY ONE IT'S NOT
A LONG TERM ONE BUT WE HAVEN'T
TALKED ABOUT ONE. THING THAT
CONCERNS ME THE MOST NOW IS
THERE IS THE HISTORIC RAPID
TRANSITION TO A DIFFERENT FORMER
TRANSPORTATION ENERGY YOU THINK
THINGS ARE **** NOW. JUST WAIT
UNTIL- UNTIL YOU HAVE TO FIGURE
OUT HOW TO GET ALL THE ENERGY
THAT'S THE LOOK IN THE PIPELINES
TODAY. DELIVERING TRANSPORTATION
ENERGY FORM OF GASOLINE AND
DIESEL FUEL ARE YOU GOING TO PUT
THAT ON THE WIRE. SO I DON'T SEE
I DON'T YET SEE ANYBODY DOING
THAT AND THAT'S A MUCH BIGGER
THING. THE ON THE ON FULLER
AROUND WITH A WINDFALL PROFITS
COUNTY. THANK YOU. OKAY MOVING
ON TO CENTERMAN- WITH THANK YOU
VERY MUCH AND- I JUST WANT TO
ECHO THE STATEMENTS THAT WERE
MADE EARLIER ABOUT MY COLLEAGUE
SENATOR DODD. AND- CENTER ASHBY-
YEAH PEOPLE ARE ANGRY YEAH EVEN
IN MY DISTRICT WHICH IS ABOUT
THEIR DISTRICT. WHEN YOU'RE
PAYING OVER A HUNDRED HUNDRED
DOLLARS AT THE PUMP- YOU KNOW
SOME FOLKS ARE JUST MISSING
CHUCKY CHEESE THEY'RE MISSING
ARE THERE STRUGGLING TO PAY
THEIR BILLS THEY'RE STRUGGLING
TO PAY THEIR MORTGAGES. THESE
ARE TOUGH TIMES FOR A LOT OF
FOLKS AND- THE FACT THAT THESE
PRICES ARE ARE CONCOMITANT WITH
RECORD HIGH INDUSTRY PROFITS.
WHEN THEY SEE THE HEADLINES
ABOUT OIL INDUSTRY'S ENGAGING
AND SHARE BUYBACKS. MASSIVE
DIVIDENDS I THINK THAT THIS IS A
LOT OF PEOPLE ARE FRANKLY. ABOUT
THE SAME TIME I THINK WE'VE
HEARD FROM A NUMBER OF
LEGISLATORS HERE- WE WANT ENGAGE
INSPIRE POLICY- AND I THINK OUR
THREE ACADEMICS ON THIS PANEL.
HAVE ALL MADE THE POINT TODAY
THAT REFINERIES ARE ONLY
RESPONSIBLE FOR PART OF THIS
MYSTERY SURCHARGE- THIS
INCREASED COST TO CONSUMERS AND
THAT GIVES ME SOME CONCERN
BECAUSE I THINK THAT TO THE
EXTENT THAT THIS PARTICULAR
PROPOSALS TARGETED. AT
REFINERIES- YOU KNOW IT'S AT
LEAST AT BEST IS ONLY A PARTIAL
SOLUTION TO WHAT WAS SEEN. IN A
MISTER BROWN I THINK YOU MEAN
THE VARIOUS TWO POINT- THAT WE
HAVE TO DECIDE WHAT THE PROBLEM
IS WE'RE TRYING TO SOLVE YOUR
LEGISLATURE. AND I WOULD SAY
THAT FROM MY PERSPECTIVE- WELL I
DON'T LOVE SINGLE OIL INDUSTRY
GET RECORD PROFITS THE REAL
CONCERNS AROUND MAKING SURE THAT
MY CONSTITUENTS DON'T. HAVE
THESE DON'T ARE NOT BEARING
THESE EXCESSIVE COSTS. AND SO
FROM THAT PERSPECTIVE LET'S
SUPPOSE THAT IS OUR PRIORITIES
LEGISLATURE. OR AT LEAST MY
PRIORITY- AND LET'S ALSO ASSUME
THAT THAT SOME VERSION OF THIS
WINDFALL PROFITS PROPOSAL WILL
PASS- WHAT CHANGES WOULD YOU
SUGGEST AT THIS POINT FROM YOUR
PERSPECTIVE. TO TRY TO MAKE IT
AS AS GOOD A PROPOSALS POSSIBLE
AGAIN UNDERSTANDING THE MAYBE IT
ONLY ADDRESSES PART OF THE
PROBLEM- MAYBE WE SHOULD EXPAND
IT TO OTHER PARTS OF THE
INDUSTRY- I'M JUST CURIOUS WHAT
YOU THINK WOULD MAKE THIS
PARTICULAR PROPOSAL BETTER. I
WAS VERY INTERESTED YOUR
TESTIMONY. THANK CENTER MAN- I
THINK UNFORTUNATELY MY ANSWER
MIGHT NOT BE COMPLETELY
SATISFYING FOR YOU I MEAN IT'S
NOT WE HAVEN'T WE HAVEN'T DONE A
DEEP DIVE FRANKLY ENTERS INTO
KIND OF THE GOVERNOR'S PROPOSAL-
AND KIND OF ALL OF THE DETAILS
AROUND IT- I DO THINK I'LL KIND
OF GO BACK TO MAYBE SOME OF THE
COMMENTS I MADE A LITTLE BIT
EARLIER- THERE'S YOU KNOW A FEW
DEPENDING ON SORT OF THE-
PROBLEM YOU'RE TALKING ABOUT
THERE ARE DIFFERENT WAYS TO
SOLVE IT AND I HEARD YOU'RE SORT
OF. YOU KNOW A KIND OF RECOGNIZE
YOUR YOUR COMMON THEY ARE
CONCERNED ABOUT SORT OF SNOW
CONSUMERS AT THE PUMP AND MAKING
SURE THAT THEY'RE- NOT PAYING
TOO MUCH IN THERE ARE YOU KNOW
ONE ONE WAY TO SORT OF FRAME
THAT PROBLEM IS. SOMETHING
AROUND YOU KNOW ATTACKS OR
SOMETHING TO SORT OF RE
DISTRIBUTE PROFITS TO DO THAT
AND THAT CASE SOMETHING LIKE A
PROFITS TAX. SEEMS TO BE SORT OF
THE MOST DIRECT APPROACH TO
DOING THAT I THINK ONE QUESTION
ABOUT THE PROPOSAL IN FRONT OF
YOU FROM THE GOVERNOR IS. IS
IT'S IS THIS REALLY SORT OF
STRUCTURED LIKE A TAX AND WILL
SORT OF REFINERS AND BUSINESSES
TREAT IT LIKE A TAX WILL THEY
WERE SORT OF CONTINUE TO DO
BUSINESS AND PAY THE COST OF
THAT TAX. OR WILL IT BE TREATED
MORE WATER BE TREATED MORE LIKE.
A PRICE CAP IN WHICH CASE YOU
KNOW IT'S A VIOLATION OF STATE
LAW. TO YOU KNOW TO EXCEED THAT
CAP AND THAT HAS SORT OF OTHER
IMPLICATIONS YOU MIGHT NOT. GET
THE REVENUE THAT CAN THEN BE RE
DISTRIBUTED TO CONSUMERS BUT- IT
HAS SORT OF OTHER IMPLICATIONS
TO THE EXTENT YOUR SORT OF
LIMITING. THE PRICE THAT
BUSINESSES CAN CHARGE- THAT
MIGHT HAVE AN IMPACT ON LOWERING
THE PRICE BUT YOU COULD ALSO
SORT OF HALF OF THEIR DOWNSTREAM
EFFECTS ON. YOU KNOW THE
INCENTIVE TO ACTUALLY SURPRISED
AT PRODUKTEN AND POTENTIALLY.
YOU KNOW GET INTO QUESTIONS
WRONG GASOLINE SHORTAGES SO. I'M
APOLOGIZE ON- PROPS RAMBLIN A
LITTLE BIT AND I DON'T HAVE-
FRANKLY SORT OF A GREAT ANSWER
FOR YOU BUT I DO THINK SORT OF.
YOU KNOW TRYING TO ZERO IN ON
SOME OF THOSE QUESTIONS AROUND.
IT WAS A MECHANISM TO TRY TO
PROVIDE RELIEF TO CONSUMERS
THROUGH. KIND OF REDISTRIBUTING
PROFITS TO CONSUMERS IS IT'S-
THROUGH A KIND OF TRYING TO CAP
THE PRICE IS IT THROUGH TRYING
SOME OF THESE OTHER CHANGES TO.
ALLOW FOR A KIND OF MORE SUPPLY
OUT THERE WHICH THAN CONCERT
BRING DOWN THE PRICE THOSE ARE
ALL SORT OF SLIGHTLY DIFFERENT
APPROACHES TO GET OUT A LITTLE
BIT DIFFERENT MIGHT BE
INTERESTED IN YOUR FOLLOW UP ON
THAT AND THEN AS MY FOLLOW UP-
MISTER JORGENSEN DAHLE GOING ON
THE MYSTERY SURCHARGE. YOU'VE
HEARD A NUMBER OF WITNESSES HERE
SAY THAT THEY BELIEVE THERE'S A
MYSTERY SURCHARGE. THAT IS MAYBE
JUST. THROUGHOUT THIS OF. CHAIN
NOT JUST CONCENTRATING THEIR
FINERY. AND THAT WE NEED MORE
INVESTIGATION AND SO I GUESS MY
QUESTION TO YOU IS THAT
SOMETHING YOU WOULD CONSIDER
DOING AS- AS FAR AS YOUR THIRTY.
NINE INTERNATIONALS OFFICE. ON
THREE. COLLUSION CASES START
OFFICE INVEST. INVESTIGATIONS SO
YOU KNOW THERE'S NEVER A
GUARANTEE WHEN YOU CONDUCT AN
INVESTIGATION- IS TO. YOU KNOW
WHETHER YOU'LL UNCOVER.
COLLUSIVE CONDUCT. BUT IT DOES
REQUIRE A LOT OF RESOURCES IN A
COMPLEX INDUSTRY LIKE THIS- WE
DO NOT HAVE AN INTERNAL ECONOMIC
CONSULTING GROUP- LIKE THE FTC
DOES. SO WE HAVE TO OUT.
OUTSOURCE THAT TYPE OF WORK- TO
QUALIFIED ECONOMISTS- IT'LL BE
ON THAT SORT OF. YES THE DATA
GATHERING IS VERY IMPORTANT. TO
KNOW MORE ABOUT PRICE
TRANSPARENCY- I AGREE WITH THE
COMMENTS- REGARDING THE OPUS
PRICE INFORMATION SERVICE- AND
WOULD SUPPORT THE CDC'S EFFORTS
AT IMPROVING- PRICING DATA.
TRANSPARENCY IN TRANSACTIONS AT
A TRANSACTION LEVEL BY BUYER AND
SELLER- SO I AGREE WITH ALL
THOSE COMMENTS. SENATORS CAN.
THANK YOU- MISTER CHAIR- STRIP
BEFORE MY QUESTIONS A LITTLE
COMMENT- I DO APPRECIATE HAVING
OUR S. EXPERTS TESTIFY I DO ALSO
APPRECIATE THOUGH IN EXPERTS ARE
CAREFUL ABOUT- ASSERTING FAX
FROM. THE POINT THAT WAS MADE
EARLIER ABOUT THAT WELL YOU KNOW
REASON. FIVE OVER THE PAST
THIRTY TO FORTY YEARS THAT HAS
BEEN A WELL STUDIED QUESTION IS
EXTREMELY MIXED AND IT TURNS OUT
THAT THE ORIGINAL. STUDIES THAT
MADE THE CORRELATION WHICH WE
ALL NOW BELIEVE WE'RE PAID BY.
HE COMMISSIONED AND PAID BY T.
THIS WAS DECADES AGO AND AS I
INDICATED ANYONE WHO DOES A
LITERATURE SEARCH WILL FIND THAT
THE DATA IS ACTUALLY QUITE
MIXED- NOW TO MY QUESTIONS-
THESE ARE GENERAL TO THE
PANELISTS ON THE ISSUE OF- SO I
DON'T KNOW IF EITHER I DON'T
THINK THESE WOULD BE TO EITHER
THE AG'S OFFICE FOR THE L. A-
BUT TO THE OTHERS AND THEN I DO
HAVE ONE TO THE- AG'S OFFICE. SO
IT THIS WAY IS IT AFFECT REALLY
ONE QUESTION BUT- WE HAD IN THE
BACKGROUND DOCUMENT TO- FIGURES
FOR TWENTY TWENTY ONE ONE IS
THAT 88% OF GASOLINE PRODUCTION
. EIGHT IN CALIFORNIA WAS USED
IN STATE 12% WAS EXPORTED. AND
SO IN THAT IT'S- CHARACTER THAT
WE'VE BEEN CHARACTERIZED AS A
SELF SUFFICIENT GASOLINE FUELS
MARKET. NOW GIVEN THIS MARKET
SHARE. WHY WOULD GAS COMPANY
STOP SELLING THEIR PRODUCT HERE
EVEN WITH YES DEMAND IS GOING
DOWN SOMEWHAT. BUT IT IS A
RATHER SLOW CURVE IN TERMS OF
WHAT I'VE SEEN NOW SECOND THE
NEW YORK RANDOCK ALSO SHOWS THAT
IN TWENTY TWENTY ONE. CALIFORNIA
WAS THE SEVENTH LARGEST PRODUCER
OF CRUDE OIL AMONGST THE FIFTY
STATES AND WE WERE THIRD IN
CRUDE OIL REFINING CAPACITY YET
THE INDUSTRY CLAIMS THAT THEY'LL
STOP REFINING. IN CALIFORNIA
THEN AGAIN YET WE UTILIZE 80%
88% OF THE GASOLINE REFINED IN
THE STATE IS THAT REALISTIC
BASED ON THE SIZE THE CALIFORNIA
MARKET. SO IT'S TWO QUESTIONS
WHY WOULD THEY STOP SELLING THE
PRODUCT HERE AND WHY WOULD THEY
STOP REFINING. BASED ON THOSE
MARKET SHARES. THE ONE ARCH
MISTER SWEENEY ALREADY HAD AND-
PROFESSOR BORNSTEIN AFTERWARDS.
SENATE SKINNER AND BY THE WAY I
REALLY APPRECIATED THE
LEADERSHIP YOU PAT ON
ENVIRONMENTAL ISSUES AND ENERGY
ISSUES OVER THE YEARS SO IT'S AN
HONOR TO BE TALKING TO YOU HERE
. I DON'T I'M NOT SUGGESTING
THAT THEY'RE GONNA WANT TO STOP
SELLING IN THE THAT THE MARKET.
BUT WITH THE MOVE TOWARDS
ELECTRIC VEHICLES THE DEMAND FOR
GASOLINE I BELIEVE IT'S PICKED
IN CALIFORNIA I BELIEVE IT'LL BE
GOING DOWN OVER TIME. AND AS IT
GOES DOWN OVER TIME REFINERS
DON'T HAVE AN INTEREST OF
CREATING MORE NOISE PAYER
CAPACITY THEY'RE GOING TO BE IN
THIS INVESTING OVER TIME. AS
THE- DEMAND FOR GASOLINE IS DOES
THE CLIMBING AND IS IT THAT.
FINALLY HI BALANCE BETWEEN
SUPPLY AND DEMAND WE HAVE. THE I
THINK THIS IS TO CREATE THE- THE
PRICE SPIKES AND THAT'S WHAT I
THINK WE'RE GONNA HAVE IN THE
FUTURE TO JUST QUICKLY FOLLOW UP
ON THAT YOU'RE ABSOLUTELY
CORRECT IT IS OUR GOAL TO HAVE
THAT DEMAND GO DOWN AND I WOULD
SPROUT I WOULD HOPE THAT WE'VE
ALREADY HIT THE PEAK- HOWEVER
THAT EVEN IF WE LOOK AT THE
PROJECTION. OF THAT DEMAND GOING
DOWN SO BUT YOU KNOW WE'RE ARE.
IT'S ONLY AN EXECUTIVE ORDER
THAT WE WOULD NOT SELL- GASOLINE
POWERED VEHICLES BY. TWENTY
TWENTY FIVE THAT'S TWELVE YEARS
FROM NOW THERE WOULD STILL
OBVIOUSLY THERE WOULD STILL BE
VERY MANY GASOLINE POWERED
VEHICLES ON THE ROAD. THE
AVERAGE CALIFORNIAN DOES NOT
REALLY BUYING A NEW VEHICLE THAT
FREQUENTLY- THE- SO WE KNOW THAT
THEY'LL STILL BE A VERY LARGE
MARKET SHARE OF GASOLINE POWERED
VEHICLES OF ALL CATEGORIES STILL
ON CALIFORNIA ROADS. SO. HELLO I
CAN APPRECIATE THIS FUTURE.
FORECASTING AND I CAN APPRECIATE
WHY PERHAPS THERE WOULDN'T BE
ANOTHER REFINERY BUILT IN THE
STATE- BUT I STILL CAN'T SEE.
WHERE IT WOULD BE IN THE OIL
COMPANIES INTEREST TO STOP
SELLING GASOLINE OR PRODUCING
GASOLINE IN THE STATE OF
CALIFORNIA. AND THE OTHER COMP
COMMONERS HAPPY THE- ANSWER OR
PROFESSOR SOON IF YOU WANT TO
ADD ANYTHING TO THAT- ALL I'M
SAYING IS THAT BUT INVOLVEMENT
FOR THREE WEEKS FINALLY IS
CLOSING. SO THERE'S A LITTLE
EVIDENCE THAT IT'S HAPPENING BUT
LET ME TURNED ON TO- THE
FESTIVAL IN THE STATE. YEAH I
INTERPRETED YOUR QUESTION
SLIGHTLY DIFFERENTLY CENTER
SKINNER ABOUT THE CONCERN THAT A
PRICE CEILING OR PRICE GOUGING
PENALTY MIGHT LEAD- IF REFINERS
TO SEND SELL GASOLINE NOW THE
STATE. AND THAT I THINK IS A
REAL POSSIBILITY IF THE IF IT'S
NOT BEING IF THE HIGH PRICES ARE
DRIVEN BY MARKET POWER.
REFINERIES ARE CONSTANTLY
OPTIMIZING WHERE THEY SELL THEIR
PRODUCT AND WHICH PRODUCTS TO
PRODUCE HOW MUCH JET FUEL HOW
MUCH DIESEL HOW MUCH GASOLINE.
HOW MUCH DISSENT ARIZONA HOW
MUCH TO SEND TO NEVADA AND THEY
GET DOWN TO THE LAST BARREL OF
OPTIMIZING IF YOU NOW SAY WE'RE
GOING TO TAKE AWAY SOME OF THE
PROFITS. FROM SELLING IN
CALIFORNIA IF FOR INSTANCE WE
HAVE A WEST WIDE PRICE SHOCK. IT
THEY ARE GONNA SAY OH WELL THEN
THEY'RE NOT GOING TO STOP
SELLING CALIFORNIA BUT THEY ARE
GOING TO SAY IT MAKES SENSE TO
PUSH MORE OF IT INTO ARIZONA.
AND SELL LESS OF IT IN
CALIFORNIA NOW AS I SAID BEFORE
IF THE PROBLEM IS THEY ACTUALLY
ARE EXERCISING MARC PERRIN
RESTRICTING THE OUTPUT ALREADY
IT COULD ACTUALLY HELP. BUT IF
TO THE EXTENT THAT IT'S REAL
SCARCITY IT COULD MAKE IT WORSE.
ON THE CRUDE OIL ISSUE. THIS
COMES UP IT'S COME UP IN MANY
DISCUSSIONS I'VE THAT CRUDE OIL
PRODUCTION IN CALIFORNIA IS
COMPLETELY IRRELEVANT TO THIS
DISCUSSION. HI YEAH AND I THINK
ALL OF THE PEOPLE ON THIS PANEL
WILL PROBABLY AGREE WITH ME I
HOPE SO- CALIFORNIA PRODUCES
SOME AMOUNT OF CRUDE OIL. AND
THAT CRUDE OIL BECOMES PART OF
THE WORLD CRUDE OIL MARKET.
WHICH IS THE OIL INDUSTRY
CONSTANTLY REMINDED US WHEN THE
PRICE OF CRUDE OIL GOES UP IN
OUR GAS PRICES GO UP THEY SAY TO
WORLD MARKET. AND THAT'S
ABSOLUTELY RIGHT BUT BY THE
EXACT SAME LOGIC WHEN WE PRODUCE
MORE CRUDE OIL IN CALIFORNIA IT
DOESN'T GET USED IN CALIFORNIA
TO LOWER CALIFORNIA PRICES. IT
JUST BECOMES PART OF THE
CALIFORNIA THE CALIFORNIA USAGE
OF THE WORLD MARKET. AND DOESN'T
DRIVE DOWN THE PRICE HERE
ANYMORE THAN A DRIVE DOWN IT
DOWN ANYWHERE ELSE AND IT
DOESN'T PROTECT US FROM PRICE
SPIKES IN ANYWAY. SO THERE'S A
BALLOT DEBATE TO HAVE ABOUT MORE
OR LESS OIL PRODUCTION IN
CALIFORNIA ABOUT THE JOBS IT
CREATES AN ECONOMIC ACTIVITY
VERSUS THE POLLUTION AND OUR
TRANSITION. BUT IT IS REALLY
NOT. AT ALL RELEVANT TO
DISCUSSING THE PRICE OF GASOLINE
CALIFORNIA. THANKS BUT SURE
DOLLARS BY YOUR ALL I'M SORRY
I'M SO. OKAY SO- MISTER
JORGENSEN. THE- OIL COMPANIES
HAVE SET THE THEY CAN'T ANSWER
THE- FROM THE C. AND SUPPOSED
THAT'S WHY THEY DIDN'T ATTEND
THE HEARING- AND ALSO. DUE TO
FEDERAL ANTI TRUST LAWS THAT WAS
ONE OF THEIR REASONS- YOU'RE AN
ANTITRUST ENFORCER. IS THERE ANY
REASON THE COMPANIES CAN'T
CONFIDENTIALLY PROVIDE THE
INFORMATION TO STATE REGULATORS
. NO THAT'S WHAT THEY DO NOW
UNDER THE PETROLEUM MINISTRY
REPORTING ACT. FROM THEY THEY
CAN'T PROVIDE ANY CAN BE
MAINTAIN CONFIDENTIALITY
CONFIDENTIALLY- BY CC. BY OTHER
YOU KNOW WHO'S BY NON CC PEOPLE
ARE INTERESTED IN GOVERNOR. THE
GOVERNMENT ENFORCEMENT OF THE
ANTITRUST LAWS. YEAH HE IN THE
IMMEDIACY OF THE USEFULNESS OF
THAT INFORMATION DWINDLES AS
TIME PASSES- SENSITIVE.
COMPETITIVE INFORMATION THAT
WOULD BE USEFUL- TO COMPETITORS
TO ENGAGE IN ILLEGAL
COLLABORATIVE CONDUCT WITH THE
PEOPLE PRODUCING THE DATA. AND
IS THERE ADDITIONAL DATA OR
TRANSPARENCY MEASURES THAT MIGHT
ASSIST THE AG'S OFFICE IN TERMS
OF THEIR- YOUR CURRENT WORK TO
EITHER DETER VIOLATIONS OR-
FACILITATE ENFORCEMENT. OF
VARIOUS FOR LAWS YES. WE ARE
HAPPY TO WORK WITH THE CDC- WHO
THEY HAVE STAFF THAT ARE YOU
KNOW. ABLE TO REVIEW AND ANALYZE
THAT DATA- WE'RE MOSTLY
LITIGATION SHOP- AND- D. HELLO
THIS IS AS THE LEGISLATION IS
CURRENTLY FORMULATED AND PIRA-
THIS IS YOU KNOW SOMETHING THAT-
WHICH IS CREATED MORE DATA
TRANSPARENCY ALONG THE LINES OF
WHAT'S BEING PROVIDED NOW- MAYBE
INDUSTRY PEOPLE WOULD DISAGREE
WITH. SOME ASPECTS OF THAT BUT-
YES SELLER BUYER INFORMATION
PRICE VOLUME- DATE OF. NO
TRANSACTIONS TIME OF
TRANSACTIONS GRANULARITY OF
INFORMATION IDENTITY OF SELLER
PURCHASER VIEWS THE BROKER'S
WHETHER IT'S REPORTED TO-
PRICING INFORMATION SERVICES
WHICH ARE PRIVATE- AND- AS A
GOVERNMENT ENFORCER I THINK A
PRIOR- HELLO. TEST FIRED
MENTIONED- THERE'S DOUBT AS TO
WHETHER GOVERNMENT- HAS ACCESS
TO THE OPUS DATA. WHETHER THEY
SUBSCRIBE TO IT AT ALL- I'LL
LEAVE THAT QUESTION OPEN BUT-
THAT IS THE- MARKET PLACE OF
INFORMATION ABOUT PRICE- AS- THE
MARKET IS CURRENTLY SET UP.
THANK YOU. OKAY THANK YOU BYE
SHARED ALLEN THANK YOU MISTER
CHAIRMAN I JUST TO. I READ ALL
THE INFORMATION I COULD BEFORE
THIS HEARING IS VERY IMPORTANT
AND- S. AS SOMEBODY WHO IS-
ELECTED TO WHO REPRESENTS A LOT
OF POOR PEOPLE WHO ARE GETTING.
REALLY HAMMERING CALIFORNIA BUT
MY TAKE AWAY IS I WANTED TO SAY
THAT WHAT WHAT I LEARNED TODAY
FROM SO FAR IN THIS
PRESENTATION- ONE REFINERS ARE-
SEEM TO BE IN LINE WITH-
WHATEVER THE CRUDE PRICES ARE WE
LEARNED THAT DOWNSTREAM AND THAT
WAS MY ORIGINAL QUESTION WHEN I
WAS LOOKING AT THE GRAPH TO
FIGURE OUT WHAT HAPPENS. ACROSS
THE STATE- NATION VERSUS
CALIFORNIA AND WHAT I LEARNED
WAS THAT GRAPH WAS WAY OUT OF
BALANCE AND SO THERE'S SOMETHING
GOING ON DOWNSTREAM THAT I THINK
THAT WE I THINK THIS COMMITTEE.
SHOULD GET SOME ANSWERS TO I
THINK THAT'S ONE OF THE PROBLEMS
THE OTHER. TAKE AWAY- IS
TRANSPARENCY ABOUT WHAT WITH
WHAT'S HAPPENING IN THAT AREA
DOWNSTREAM FROM THE REFINERS AND
THEN OPUS SOMETHING THAT- WHO
WAS BROUGHT UP BY ONE OF OUR
PANELISTS. WE ACTUALLY USED OPUS
IN THE COUNTY WHEN I WAS THERE
OPUS IS A SYSTEM WHERE YOU. BUY
YOUR FUEL FOR A WHOLE YEAR BASED
OFF OF A PRICE OF DELIVERY. TO
YOUR TO YOUR COUNTY OR YOUR GROW
DEPARTMENT- AND IT'S A BASE
PRICE OF THE GETS BIT ON THE
PRICE OF OPEN TO ALL THE
SUPPLIERS BID AND ONE WINS THE
BID. AND OUTBID TO GIVE YOU A
CERTAINTY IN WHATEVER THE MARKET
IS YOU'RE GOING TO PAY THAT
TRANSPORTATION COSTS PLUS A
PROFIT. TO STABILIZE YOUR YOUR
SUPPLY. I THINK WE NEED TO FOCUS
ON THAT I'D LIKE MORE
INFORMATION FROM THE GENTLEMAN
THAT TALKED ABOUT OPUS. ON ANY
LEARN A LITTLE BIT MORE ABOUT
THAT ABOUT THAT I THINK THOSE
ARE THE- FEW THINGS THAT THIS
COMMITTEE THAT I LEARNED TODAY-
THIS NOT REALLY WORKS.
POLITICALLY WERE FOCUSED ON
REFINERS AND THEIR AND THEIR
ABILITY TO MAKE PROFITS WHICH
IS. OUR WORLD RIGHT COMPANIES
BUT AT THE END OF THE DAY- I
LEARNED THAT THE DOWNSTREAM
FOLKS HAVE A LOT TO PLAY WITH
AND I THINK WE NEED TO
INVESTIGATE THAT. A LOT MORE AS
WE MOVE FORWARD WITH THE- WITH
THIS PROCESS. THANK YOU CENTERS
ART. BE GOOD OKAY. WELL I DO I
WANT QUESTION FOR CON SURE
ANYWHERE EXPERT TO DOWN TO THE-
ARE THERE ANY EXAM. FOR CAPPING
PROFITS HAVE- IN LORTON. HAVE
LOWER PRICES FOR CONSUMERS.
BECAUSE THE ONLY EXAMPLE I'M
FAMILIAR WITH THIS DURING THE
ENERGY CRISIS WHEN WE LIMITED
HOW MUCH- UTILITIES COLLECT AND
IT LED TO. ONE UTILITY GOING
BANKRUPT AND THE SECOND ALMOST
GOING BANKRUPT RIGHT AT THE
DOORSTEP TO BANKRUPT SO IS THERE
ANY EXAMPLES WERE. CAPTAIN
PROFIT HAS. WORKING LOWER PRICES
FOR CONSUMERS. I DON'T KNOW OF
ANY OTHER GOING BACK TO THE
SEVENTIES UNDER JIMMY CARTER. WE
HAD SOME WAGE AND PRICE CONTROLS
BUT- D. INTO THE YOU KNOW THE
DATA WOULD INDICATE PARTICULARLY
FOR GASOLINE. THAT IT DIDN'T
HAVE A FAVORABLE EFFECT ON
CONSUMER PRICES- I THINK FOR
CALIFORNIA. RE ABLE WHAT WE ALSO
NEED TO DO I MEAN IT'S ONE THING
TO THINK ABOUT COMPETITION. BUT
WE'RE LOSING GAS STATIONS WE
HAVE LESS GAS STATIONS ISSUE
THEN WE HAVE THE FOLLOWING YEAR
AND WE HAVE MORATORIUMS AND
SUSPENSIONS ON BUILDING KNOWN.
TO VERY TOUGH TO GET BUT WE
CAN'T CREATE MORE COMPETITION BY
INCREASING AND DIVERSIFYING THE
SUPPLY. AND SO THERE IS ONE- ON
PAGE EIGHTEEN OF MY MATERIAL
SOME IDEAS VOTERS WANTED LIKE TO
JUST CALL YOUR ATTENTION TO. AND
THAT IS AB X. ONE THREE. WHICH
IS- BEEN- BEEN AUTHORED BY DR
GAINES. AND THAT IS- AND THAT IS
AN IDEA TO INCREASE- SUPPLY
ENCOURAGING CALIFORNIA
PRODUCTION. IN ADDITIONAL BUYING
OF DOMESTIC PRODUCED PRODUCTION
SO YOU KNOW THE ONE THING THAT'S
GONNA BRING PRICES DOWN IT'S
MORE SUPPLY THE COMPETITION
PARTY TOO BECAUSE- HARD TO BILL
GAS STATION. PROFESSOR BORNSTEIN
YEAH I HAVE TO COMPLETELY
DISAGREE OF THE PRESERVATION IS
REFERRING TO SUPPLY OF CRUDE
OIL- AS I ALREADY EXPLAINED THAT
IS NOT GOING TO BRING PRICES
DOWN- IT IT IT'S A COMPLETELY
SEPARATE SUBJECT AND I THINK
ALMOST EVERY ECONOMIST WHO
STUDIES THE ENERGY MARKET WILL
AGREE ON THAT- IN TERMS OF PRICE
CEILINGS THAT HAVE WORKED. THE
PRICE CEILING- THAT YOU'RE
REFERRING TO CENTER BRADFORD WAS
THE RETAIL PRICE FREEZE THE
ACTUAL WHOLESALE PRICE CAP.
WHICH WE PUT IN PLACE D. WAS
ALSO NOT VERY SUCCESSFUL- AND IN
A WAY THAT- IS ILLUSTRATIVE HERE
BECAUSE IT WAS ONLY IMPOSED IN
CALIFORNIA. AND ONE OF THE
CONCERNS AND TELL THE FOR
FINALLY I THINK BURKE FINALLY
DID IMPOSE A WEST WIDE PRICE
CEILING BUT MUCH LATER. AND THE
PROBLEM WAS THAT WE SAW A LOT OF
POWER LEAVING THE STATE BECAUSE
WE HAD A LOWER PRICE CEILING
THAN THE MARKET PRICE- BUT- I
ACTUALLY ADVOCATED BACK THEN FOR
A WEST Y. PRICE CEILING. I WISH
THEY I THINK WE COULD HAVE SAVED
A LOT OF MONEY IF WE HAD GONE
THERE YET BECAUSE I THINK
THERE'S A LOT OF MARKET POWER
THAT- AND I THINK WE THAT IN
THAT CASE IT WOULD HAVE BEEN A
SUCCESSFUL. MOST OF THE THINGS
ON MY LIST ON MY SLIDES ARE
UNSUCCESSFUL INCLUDING HAWAII'S
ATTEMPT TO CONTROL PRICES IN THE
200-052-0006 WHICH THEY PUT IN
PLACE AND RESCINDED- ON GAS
PRICES THIS IS WITHIN A COUPLE
OF YEARS. USE FASTER SWING.
THERE HAVE BEEN SEVERAL CASES
NOT JUST IN THE ENERGY AREA.
THAT THE PRICE CAP TO CAP PRICES
FROM GOING UP. WHEN WE HAD THE
POOREST ENERGY CRISIS WE PUT ON
GAS CAPS. GASOLINE PRICES DIDN'T
COME UP GO UP. THAT BOOK NOW AND
PUT WE HAD MASSIVE GASOLINE
LINES WE- FOR IN TERMS OF I'M
GLAD THAT THE AND- THE- PRICE
THAT WITH. AND WE HAVE. PRICE
CAPS AND I'M WENT TO. AND A LOT
CITIES THAT COULD. THE OF. BOB
IT KEEPS OF FROM GOING ON. SO
IT'S IT IS THE TRYING UP. WHAT I
THINK WOULD GOT IT WILL. THE
JETS BECAUSE WE HAVE A COOK
PLAYS. I MEAN THAT THE ANY MY
POWER I LIKED SHOW MY SCREEN
VERY. TO SHOW JUST ONE. EXAM AS
AND THE- THIS IS THE PRICE OF
EGGS. ON THIS IS- UP FROM THE
YORK TIMES WE KNOW THE OF A IS
UP. THERE'S A LOT OF COMMON L.
BE THE AND GAS. WE HAVE VERY
LITTLE SUPPLY FROM OTHER THINK
WE GOT A LITTLE SUPPLY FROM
MEXICO. CHICKENS DON'T LAY MORE
EGGS IF YOU SQUEEZE THEM. HAVE A
HIGHER PRICE SO THAT A LITTLE
LAST IF YOU SUPPLY THEM VERY
LITTLE A TOO OF DEMAND SO THE AB
AND- AVIAN FLU KILLING ALL SEVEN
CHICKEN. REDUCE SUPPLY OF A AND
THEN THEY SHOULD PERIOD OF TIME
WITH HAD MORE THAN A DOUBLE OF
THE WEEK PRICE OF A- THE FACT
THAT I THE PRICE SPIKE THAT
WOULD SING. I'M GOING TO BE FOR.
ANYMORE THE PRICE OF EGGS WITH
BE. FIVE SORT OF PRICE K.
ALTHOUGH I DO THINK LAW. TERM
THE MYSTERIES I. IS SOMETHING WE
THAT COULD BE MY KID POWER I
KNOW IT IT IS BUT THAT'S WHAT I
WOULD LIKE TO LEAVE FOCUS THE
LONG TERM ATTENTION BECAUSE
THAT'S WHAT I THINK IS THAT THE
BIG IMPACT. THANK YOU MR CALL.
TRUANTS WITH. CERTAINLY GOING TO
REAR SEVERAL. BOB TO ACTUAL
MARKET AND PER. THE GROUPS OF
YES IN CALIFORNIA IS GREAT ON
THE NEW YORK PRICE OF GASOLINE.
THE INDEX FROM FULL. AREAS-
DELTA THAT. SO YOU CAN PRODUCE
ALL THE OIL YOU WANT IN HEALTH.
BUT UNLESS IT CHANGES THE YORKER
GRACE IT'S NOT GOING TO AFFECT
THE WORK MARKET. FOR THE SECOND
ISSUE I WAS A LITTLE TO DISCO OF
THE CAL. CRISIS. I BELIEVE IT
WAS NEVER TO WE WERE A LONG TIME
WEST PRO CARE WE RESERVE IT ON
JUNE TENTH. TWO THOUSAND ONE.
ONE I WENT INTO PLACE ALMOST ALL
OF THE ILLEGAL. ACTIVITIES
STOCKTON CALIFORNIA WHY WAS.
BEIJING A CRIMINAL PENALTY. WHEN
YOU COULD ACTUALLY GET A GREATER
REWARD BREAK SO IT SETS. THE
AUDITORS OF THE PLANTS WERE
REDUCED THE PRICE NEVER GOT TO
THE PRICE CAP. AND THE ENTIRE.
OUR PROBLEM BASICALLY WITHERED
AWAY. AND IRONICALLY BY THE WAY
IT ALSO BANKRUPTED ENRON BECAUSE
THEY GAMBLE SO MUCH ON THE
CONTINUING OF THE- CALIFORNIA
ENERGY GROWS. THANK YOU I'M
GONNA THINK THE L. A. L. THE
ATTORNEY GENERAL'S OFFICE AND
OUR OUR ECONOMISTS AND EXPERTS
AND INDUSTRY ASPECT FOR IT FOR
YOUR TESTIMONY HERE TODAY AND
MUCH APPRECIATED AND NOW WE'RE
GOING TO MOVE ON TO OUR
STAKEHOLDERS PANEL. AND OUR
STICKER WAS PANEL WILL CONSIST
OF CANCER RESEARCH FOR A
PRESIDENCY- THE WESTERN.
SITUATION JAMIE COURT PRESIDENT
AND CHAIRMAN OF THE BOARD OF
CONSUMERS WATCH DOGS JOHN WINGER
LEGISLATIVE ADVOCATE FOR
CALIFORNIA FUELS AND CONVENIENCE
ALLIANCE IN CASE YOU SEE GO
SENIOR COUNSEL FOR CLIMATE LAW
INSTITUTE. CENTER BIOLOGY
DIVERSITY SO HOW. THIS REPORT
WHEN YOU'RE READY YOU MAY BEGIN
YOUR TESTIMONY. AND I'M FOR
FOURTEEN YEARS FOR FIVE MINUTES
AS WELL. I DON'T THINK YOU. WHEN
IT'S READ I'M USED TO BEING
GREEN. GOOD AFTERNOON CHAIR AND
MEMBERS OF THE COMMITTEE- FOR
THIS OPPORTUNITY TO SPEAK WITH
YOU TODAY I'M CATHY REID HAS
BUOYED REPRESENTING THE WESTERN
STATES PETROLEUM ASSOCIATION.
PRESIDENT AND CEO. SO WE SPOKE
REMAINS VERY CONCERNED ABOUT OUR
STATE'S ABILITY TO MEET ITS
ONGOING LIQUID FUEL DEMAND WELL
INTO THE FUTURE. EVEN AS THE
STATE SEEKS TO TRANSITION AWAY
FROM FOSSIL FUELS AND INCREASES
THE V. ADOPTION. CALIFORNIA
CONTINUES TO BE THE THIRD
LARGEST GASOLINE MARKET IN THE
WORLD. A BEHIND THE UNITED
STATES AND CHINA SEVERAL PANEL
MEMBERS MENTION THIS THIS IS
ESPECIALLY CONCERNING GIVEN THAT
IT IS ESTIMATED CALIFORNIA WILL
LOSE 16% OF ITS IN STATE
GASOLINE PRODUCTION. BY THE END
OF THE YEAR. OUR INDUSTRY IS
STRONGLY OPPOSED TO SENATE BILL
X. ONE DASH TWO. BECAUSE IT
MISGUIDED LEE FOCUSES ON
PROFITS. RATHER THAN THE ROOT
CAUSE OF PRICE SPIKES WHICH IS A
LACK OF SUPPLY. THE WAY TO
ADDRESS PRICES AND PROVIDE
RELIEF AT THE PUMP IS TO
INCREASE A RELIABLE AND SAFE
SUPPLY. AS THE CALIFORNIA ENERGY
COMMISSION AND SEVERAL ATTORNEY
GENERAL'S HAVE REPEATEDLY
ACKNOWLEDGE CALIFORNIA CONTINUES
TO FACE SERIOUS SUPPLY
CONSTRAINTS. AS IT RELATES TO
CRUDE OIL TO GASOLINE DIESEL JET
FUEL. THE SUPPLY CONSTRAINTS
COUPLED WITH DEMAND GIVEN BY THE
WORLD'S FOURTH LARGEST ECONOMY
AND THIRTY FIVE MILLION INTERNAL
COMBUSTION ENGINE VEHICLES.
AGAIN EVEN AS WE ADOPT MORE EV'S
ARE THE PRIMARY DRIVERS OF FUEL
COSTS IN THE STATE. EVEN DEMAND
DECREASE HAS TO MATCH THE
STATE'S REFINING CAPACITY. FOR
MORE THAN TWENTY YEARS I'VE BEEN
THROUGH MANY OF THEM THE CDC HAS
CALLED OUT SUPPLY CONCERNS. IN
TWO THOUSAND FIVE THEY'RE
INTEGRATED ENERGY POLICY PURPORT
CONCLUDED THAT THE INDUSTRY WILL
NEED TO PERMIT AND CONSTRUCT A
CERTAIN AMOUNT OF NEW
INFRASTRUCTURE TO IMPORT STORE
AND DISTRIBUTE FUELS. TO THIS
END THE STATE SHOULD WORK WITH
THE INDUSTRY AND LOCAL
GOVERNMENTS TO ENSURE THESE
INFRASTRUCTURE IMPROVEMENTS ARE
IMPLEMENTED. IN TWO THOUSAND
NINE THE CDC STATED RELIANCE ON
FOREIGN OIL IMPORTS INCREASINGLY
PUTS THE STATE'S FUEL SUPPLY AT
RISK. NOT ONLY BECAUSE OF
SECURITY AND RELIABILITY
CONCERNS BUT ALSO BECAUSE THE
MARINE PORTS ARE NOT EXPANDING
TO MEET THE EXPECTED GROWTH IN
DEMAND. IN TWENTY ELEVEN THE CDC
WARNED THAT DUE TO
INFRASTRUCTURE CONSTRAINTS OUR
ENERGY SECURITY MIGHT ALSO
HINGED ON DEPENDENCE ON SOURCES
THAT ARE RISKY DEAL POLITICALLY.
ECONOMICALLY AND FROM OTHER
POTENTIAL DISRUPTIONS OR SUPPLY
LIMITATIONS. SO THE CDC HAS GOT
IT RIGHT FOR A VERY LONG TIME.
WE JUST HAVEN'T IMPLEMENTED ANY
OF THE RECOMMENDATIONS SO OUR
REFINERS ARE THINLY BALANCED TO
MEET THE DEMAND WE'VE BEEN
DENIED PERMITS TO STORAGE WE'VE
BEEN DENIED PERMITS FOR
INFRASTRUCTURE IMPROVEMENTS WE
CONTINUE TO RELY ON HEAVILY
HEAVILY DON'T RELY ON FOREIGN
CRUDE OIL IMPORTS PUTTING OUR
ENERGY RISK SECURITY. EVEN MORE
AT RISK THAN IT EVER HAS BEEN.
FUEL COSTS ARE DRIVEN BY SUPPLY
AND DEMAND AND THE WAY TO
ADDRESS COSTS ARE INCREASING
SUPPLY. THE BILL DOES NOTHING TO
ADDRESS CALIFORNIA'S FUNDAMENTAL
SUPPLY ISSUES PRICE CAPS TAXES
TAX LIKE PENALTIES DO NOT
INCREASE SUPPLY. OR REDUCE COSTS
BUT INSTEAD COULD HAVE THE
OPPOSITE EFFECT. CALIFORNIA AND
THE WEST COAST OUR POLITICAL ARE
GEOGRAPHICALLY ISOLATED FROM
REFINING HUBS IN THE REST OF THE
UNITED STATES. THERE ARE NO
PIPELINES TO BRING CRUDE OIL OR
GASOLINE PRODUCTS IN THE
CALIFORNIA WHEN LOCAL SUPPLIES
ARE INSUFFICIENT TO MEET DEMAND
ADDITIONAL OIL AND GAS MUST BE
BROUGHT IN BY MARINE VESSELS
WHICH TAKE TYPICALLY THIRTY TO
FORTY FIVE DAYS TO ARRIVE.
CALIFORNIA'S VEHICLE EMISSION
STANDARDS ARE ALSO AS WE KNOW
THE MOST STRINGENT- IN THE
COUNTRY AND WE'RE REQUIRED TO
MAKE A VERY UNIQUE SPECIFICATION
OF FUEL CALL CAR BOB. MORE
EXPENSIVE MAKE WITH VERY FEW
REFINERIES OUTSIDE OF THE STATE
THAT CAN PRODUCE IT. BECAUSE OF
THIS ISOLATED INFRASTRUCTURE AND
UNIQUE FUEL PLANS THE STATE IS
ESPECIALLY SENSITIVE TO SUPPLY
DISRUPTIONS FOR EXAMPLE ON
PLANNED REFINERY OUTAGES. BUT AS
WE'VE SEEN HISTORICALLY THE
MARKET CORRECTS ITSELF THE
PROPOSED PENALTY WOULD LIKELY
PREVENT THIS NATURAL CORRECTION
AND WOULD LIKELY INCREASE THE
DURATION OF THE COST INCREASES
RELATED TO SUPPLY DISRUPTIONS.
IT'S ALSO IMPORTANT TO
UNDERSTAND THAT THE PUBLICLY
TRADED COMPANIES THAT MUST
COMPLY WITH THIS BILL. HAVE A
FEW DAYS SURE RESPONSIBILITY TO
NOT WILLINGLY AND KERR
GOVERNMENT PENALTIES AND FINES.
SO AS A RESULT OF S. B. X. ONE
DASH TWO IT COULD LEAD TO MORE
SEVERE SHORTAGES BECAUSE IT MAY
CAUSE REFINERS. TO REDUCE
SUPPLIES SOME JET FUEL DIESEL
AND OTHER TRANSPORTATION FUELS
OR JUST THE TYPES OF PRODUCT
THEY WOULD OTHERWISE PRODUCE TO
AVOID VIOLATING THE STATUTE. SO
THE BILL'S UNNECESSARY IT PUTS
FURTHER STRAIN ON THE FUEL
MARKETS AT LEAST DISAPPEAR
UNINTENDED CONSEQUENCES WHICH
INCLUDE OBVIOUSLY FIRST THE
MAJORITY OF JOBS AND CONTRACTING
WORK DONE AT CALIFORNIA
REFINERIES ARE DONE WITH UNION
LABOR. OUR INDUSTRY IS PROUD TO
PARTNER WITH THE STATE BUILDING
CONSTRUCTION TRADES COUNCIL
WHO'S ALSO OPPOSED TO THIS BILL.
AS UNION JOBS WILL BE REDUCED.
SECOND AS A SAID TO COMPLY WITH
THE BILL WOULD HAVE DEVOID THE
GALLEON GASOLINE PRODUCTS FLEETS
WOULD NEED TO BE ADJUSTED AND
AMOUNT OF ADS GASOLINE MAY BE
REDUCED. PRODUCTION GASOLINE
PRODUCTION WOULD ALSO LEAD TO A
POTENTIAL REDUCTION IN JET FUEL
AND DIESEL. THIRD THE BILL
RESULTS IN A REDUCTION IN
PROPERTY TAX RULE VALUES FOR
CALIFORNIA REFINERIES. PROPERTY
TAX IMPACTS WOULD LIKELY OCCUR
IN LOS ANGELES CONTRA COSTA
SOLANO KERN COUNTY WITH REDUCED
FUNDING FOR SCHOOLS AND LOCAL
GOVERNMENT. AND LASTLY RELYING
ON EVEN MORE IMPORTS MOSTLY FROM
ASIA TO MEET DEMAND. WOULD
RIGHTLY RESULT IN HIGHER
VOLATILITY HIGHER TRANSPORTATION
COSTS AND INCREASE THE LENGTH OF
SUPPLY SHORTAGES AS FUEL WOULD
TAKE LONGER TO GET TO THE STATE.
LET ALONE INCREASE GREENHOUSE
GAS EMISSIONS WHICH WE HAVEN'T
EVEN TOUCHED ON IN THIS HEARING.
SO A GREATER RELIANCE ON IMPORTS
THAT MAY OR MAY NOT BE AVAILABLE
IS A VERY RISKY AND POTENTIALLY
COSTLY GAMBLE FOR CALIFORNIA
CONSUMERS. AS MENTIONED. IN THE
IN THE LAST PANEL IS NOT FORGET
THE STATE OF HAWAII- BRIEFLY
IMPOSED PRICE CAPS ON GASOLINE
IN TWO THOUSAND TWO. HOW WAS
LECTURED LEGISLATURE HAD TO
QUICKLY REPEAL THEIR OWN LAW
AFTER AN INDEPENDENT VALUATION
FOUND THESE MEN MEASURE
GENERALLY ARE INEFFECTIVE. RISKY
COSTLY OPEN TO MANIPULATION AND
COMPLICATED TO ADMINISTER. WE
RECOGNIZE THE POLITICIZED NATURE
OF THIS ISSUE. OKAY S. B. X. ONE
DASH TWO IS LIKELY TO POSE AN
IMMEDIATE NEGATIVE IMPACT ON
GASOLINE PRICES AND ECONOMIC
ACTIVITY THROUGHOUT THE STATE.
CALIFORNIA IS IN THE MIDST OF AN
OVERALL ENERGY AFFORDABILITY AND
RELIABILITY CRISIS JUST FOR
GASOLINE. BUT FOR ELECTRICITY
AND NATURAL GAS AS WELL THE
CONSISTENT CONTRIBUTING FACTOR
BEHIND ALL OF THESE IS THERE IS
SIMPLY NOT ENOUGH ADEQUATE AND
RELIABLE SUPPLY JUST LAST YEAR
THE STATE REVERSED ITS COURSE TO
KEEP DIABLO CANYON NUCLEAR
FACILITY. OPEN TO KEEP THE
LIGHTS ON. NOW WE SEE NATURAL
GAS PRICES SKYROCKETING AND
CALIFORNIA FOR CALIFORNIA
RESIDENTS BECAUSE SUPPLIES AND
STORAGE CANNOT KEEP UP WITH
INCREASED DEMAND. NATURAL GAS
STORAGE HAS BEEN DRAMATICALLY
REDUCED. I PLAN TRANSMISSION
INFRASTRUCTURE IS AT CAPACITY SO
GASOLINE IS NO DIFFERENT. WHEN
THE STATE SIMPLY DOES NOT HAVE
ENOUGH GASOLINE REFINING
CAPACITY TO MEET DEMAND. SO ON
THE TWENTIETH ANNIVERSARY OF THE
CALIFORNIA ELECTRICITY CRISIS
LET'S NOT FORGET ABOUT WHAT
HAPPENED WHEN WE HAD A
LEGISLATIVE DIRECTED ENERGY
EXPERIMENT. TO TURN THE LIGHTS
OFF IN CALIFORNIA. EXPERIMENTING
WITH CALIFORNIA'S FUEL SUPPLY
MARKET CAN HAVE SIMILAR
REPERCUSSIONS THIS IS TOO
IMPORTANT TO GET WRONG. LET'S
WORK TOWARDS A BETTER WAY OUT OF
POLITICAL WAY BECAUSE I BELIEVE
FOR MORE UNITED ON THIS THAN WE
ARE DIVIDED THANK YOU THANK YOU.
THIS COURT. THANKS TO ME AS GROW
MY SCREEN HERE- THANK YOU. THE
REAL PROBLEM WE HAVE IN
CALIFORNIA IS WE HAVE FIVE
REFINERS THAT MAKE 97% OF OUR
GASOLINE AND WHEN THEY WANT TO
SQUEEZE AS THEY CAN YOU'LL SEE
THEY SQUEEZE AS HARD THIS YEAR.
WE HAD A TWO DOLLAR AND SIXTY
CENT GAP WITH US GAS PRICES. AND
THAT WAS A REALLY HISTORIC WE'VE
NEVER HAD ANYTHING LIKE THAT IF
YOU ADD THE ENVIRONMENTAL RULES
AND TAXES IT SHOULD BE ABOUT
SIXTY NINE CENTS WE PAY MORE IN
CALIFORNIA. THE LAST TIME WE HAD
A GAP WAS A DOLLAR SIXTY A
GREATER AND THAT WAS IN TWENTY
FIFTEEN AFTER THE EXXON TORRANCE
REFINERY BLEW UP. WHEN GAS
PRICES SPIKE THE PEOPLE GET HIT
MOST OF THE LOW INCOME WORKERS
AT FOUR DOLLARS A GALLON- IN
MINIMUM WAGE WORK WILL SPEND 9%
OF THEIR OUT OF POCKET AFTER
TAX. INCOME ON GAS AT SIX
DOLLARS A GALLON. IT'S 13% OF A
MINIMUM WEAKER BUT WAGER
WORKERS- THAT'S WHAT THEY SPEND
ON GAS. AND IF YOU DOUBT THAT IT
RESULTED WINDFALL PROFITS IT DID
THE BIG FIVE OIL REFINERS HAD IN
THE FIRST NINE MONTHS WITH THE
REAL GALA G. WENT ON. WE HAD
ALMOST A QUADRUPLING OF PROFITS
IF YOU TAKE THE WHOLE YEAR IT
WAS A TRIPLING OF PROFITS. BUT
MORE GRADUALLY WE ACTUALLY DO
LOOK AT THE REFINING MARGINS
THAT ARE ARE PRESENTED. TO
INVESTORS BY THE COMPANIES
THEMSELVES OVER THE LAST TWENTY
YEARS. THIS IS THEIR ACTUAL
GROSS REFINING MARGINS THE
DIFFERENCE BETWEEN. THE
PETROLEUM PRODUCTS THEY SELL IN
THE CRUDE OIL THAT GOES IN. AND
YOU'LL SEE OVER THE LAST TWENTY
YEARS THEY HAD THIRTY THEY MADE
A THIRTY TWO CENT. PROFIT PER
GALLON FOR WANT OF A BETTER
WORD. BUT THIS YEAR YOU'LL SEE
THAT PROFIT FOR GALLONS A DOLLAR
TWELVE DOLLAR ONE EIGHTY TWO
CENTS SEVENTY EIGHT CENTS. ONLY
THREE TIMES IN THE LAST- THIRTY
TWENTY YEARS AB OIL REFINERS
MADE MORE THAN FIFTY CENTS PER
GALLON. IN PROFIT OR OR
PRESIDENT OF REFINING MARGIN-
ONE WAS TWENTY FIFTEEN. OF ONE
WAS TWENTY OH SEVEN AND ALL THE
TIME IT WAS CHEVRON. NONE OF THE
OTHER REFINERS ECLIPSE FIFTY
CENT PER GALLON UNTIL THIS YEAR
IN WHICH ALL OF THEM DID IT.
EVERY REFINER OF CLIPS THAT.
WHAT I WOULD. SAID AS A WINDFALL
OFFICE LINES. AND IF YOU AT THE
MARCH. FOR THE WHOLE YEAR FOR
THESE. THEY THAN DOUBLE. THEIR
MARGINS AFTER REFINING LEVEL.
TWENTY TWO TWENTY TWO TWENTY
TWENTY TWO THE HIT SIXTY SIX
CENTS PER GALLON. IN PROFIT
THEIR AVERAGES THIRTY TWO CENTS
PER GALLON HISTORICALLY. THIS IS
A REFINING PROBLEM THIS IS A
REFINING SURCHARGE THERE IS NO
MYSTERY HERE IN WHAT HAPPENED IN
TWENTY TWENTY TWO. IT IS ALL
ABOUT THE REFINING SECTOR. OIL
REFINERS MEET 30% MORE PROFIT.
FROM THE WEST COAST LAST
CALIFORNIA THAN FROM ANY OF THE
OTHER REGIONS AROUND THE WORLD.
THIS IS THEIR OWN REPORTED DATA
. AND THIS IS ANOTHER EXPRESSION
OF THE SOLID LINES WHAT THEY
MADE AND ELSEWHERE IN THE DOTTED
LINES WITH A MADE IN CALIFORNIA.
SO WE LOOKED AT FOR THE FIVE
REFINERS. AND APPLIED THIS FIFTY
CENT CAP. AND WE FOUND THAT IF
YOU DID A PENALTY AT THAT FIFTY
CENT LINE. ZERO ONE POINT EIGHT
BILLION DOLLARS OF MILLION
DOLLAR- THAT AT ONE POINT EIGHT
BILLION DOLLARS. BACK TO
CALIFORNIA CONSUMERS. WILL GET
THE CHEVRON IN A MOMENT BUT WHY
THEY PRICE GOUGING PENALTIES IT
CREATES PRICE CONSISTENCY THIS
IS THE THING THAT PEOPLE. HAVE
TO UNDERSTAND ABOUT STOPPING A
PRICE SPIKE. WHEN IT GOES UP BUT
WHAT WOULD YOU WANT TO FILL UP
IS TWENTY DOLLARS MORE AND
THAT'S IN THE IN A MATTER OF TWO
WEEKS PEOPLE CAN'T AFFORD IT. A
PRICE GOUGING PENALTY CREATES
CONSISTENCY AND THE CHOPPERS THE
PROFIT SPIKES WHICH IS EVERY
TIME YOU HAVE A PRICE SPIKE YOU
HAVE A PROFIT SPIKE. BECAUSE THE
COST OF PRODUCTION DON'T DOESN'T
GO UP JUST THE ABILITY THE
CHARGE FOR. TO THIS DETERRENCE
PROFITEERING IT ALSO PREVENTS
OIL REFINERS FROM USING THEIR
PRICING POWER UNDERMINE OUR
ENVIRONMENTAL LAWS. WHICH IS A
LOT OF WHAT WE BELIEVE HAPPENED
THIS YEAR. WHY THE PRICE WAS SO
GREAT WHEN THERE WAS NO APPARENT
SHOCK TO THE MARKET NO APPARENT
SHOCK TO SUPPLY. BUT PRICES.
WERE TWO DOLLARS AND SIXTY CENTS
GREATER. SO THE PRICE GOUGING
HEALTH IS READY AN IMPACT. IF
YOU LOOK. GOVERNOR MADE
ANNOUNCED OCTOBER SEVENTH OF A
SPECIAL SESSION. BOLERO'S
MARGINS WENT RIGHT BACK DOWN TO
THE RESTORE. NORMS FROM A HIGH
OF EIGHTY THREE SIXTY CENTS WENT
RIGHT BACK DOWN THE THIRTY SIX
CENTS. AND NOT ONLY THAT. THEIR
MARGINS FOR THE REST OF THE YEAR
WERE HIGHER IN CALIFORNIA AS THE
PATTERN AND EVERYWHERE ELSE. BUT
YET AFTER THE GOVERNOR MADE THE
ANNOUNCEMENT IN THE FOURTH
QUARTER. THEIR MARGINS WERE
LOWER. IN CALIFORNIA THAN
ANYWHERE ELSE. CITY PATTERN WITH
PBF. PBF MARGINS WENT RIGHT DOWN
TO FORTY ONE CENTS TO DISTORT
MARGIN I THINK IS THIRTY NINE
CENTS- AND CHEVRON- THE CHEVRON
ISN'T EVEN THE CASE CHEVRON MEET
EIGHTY FIVE CENTS. PER GALLON
PROFIT OFF WEST COAST REFER.
REFINING WHICH IS A STAGGERING
AMOUNT BUT LAST GREATEST MARGIN
THEY HAD WAS IN TWENTY FIFTEEN
WHEN THEY MEET. SIXTY FIVE CENTS
THIS YEAR WAS EIGHTY FIVE CENTS
AND THIS IS JUST PROVIDING. THIS
IS NOT DOWNSTREAM. IF YOU APPLY
THE FIFTY CENT LINE. THEY WOULD
OPEN ONE POINT FOUR BILLION
DOLLARS BACK TO THE CALIFORNIA
PUBLIC. ALL TOLD ALL FIVE
REFINERS WOULD OPEN THREE POINT
ONE BILLION DOLLARS BACK. IF YOU
DREW THAT A ROBOT WINDFALL
PROFITS LINE AT FIFTY CENTS. NOW
YOU ASKED ABOUT PRESIDENT THERE
IS A PRECEDENT FOR POSING A
REASONABLE RATE OF RETURN. WHICH
IS WHAT A WINDFALL PROFITS LINE
IS ON THE INSURANCE INDUSTRY IN
NINETEEN EIGHTY EIGHT WE OPPOSE
A REASONABLE RATE OF RETURN
STANDARD. THEY CAN'T MAKE MORE
IN A CERTAIN AMOUNT OF MONEY IN
THE IN THE HOLE IN THE PROPERTY
CASUALTY INDUSTRY. INSURERS
THREATEN TO LEAVE THE STATE AND
YET NOW WE HAVE THE SECOND MOST
COMPETITIVE AUTO INSURANCE
MARKET IN THE WORLD. AND THE
COST OF LIABILITY INSURANCE HAS
DECREASED BY FIVE POINT 7% THE
CALIFORNIA WILL NATIONWIDE ONE
OF FIFTY EIGHT PERCENT. THE
ASSEMBLY EDITORIALS WHEN THEY
SOON TO LEAVE THE STATE. THEY
WON THE RIGHT TO LEAVE THE STATE
THEY NEVER LEFT BECAUSE THEY'RE
MAKING SO MUCH MONEY HERE
BECAUSE IT REMAINS A LUCRATIVE
AND NEITHER WILL THE REFINERS.
ONE MORE EXAMPLE IS THE- HMO.
ABOVE PROFIT LOVE PROFIT LOSS
RATIO- UNDER OBAMACARE WE SET A
15% LIMIT ON PROFITS 20% LIMIT
FOR. FOR THE INDIVIDUAL MARKET
AND IT'S KEPT INSURANCE RATES
NOW. ANOTHER GOOD EXAMPLE. THE
LAST SLIDE SHOWS THAT THERE IS
HUGE PUBLIC SUPPORT BEHIND THIS
PROPOSAL. MORTON SIX IN TEN
VOTERS BACKED THE PROPOSAL. 64%
WHEN HE CAUGHT A WINDFALL
PROFITS THAT. 62% WE CALL THE
PRICE GOUGING REBATE. THIS WAS
DONE IN OCTOBER FOR THE
ELECTION. THERE WAS ANOTHER MORE
RECENT POLL. DONE BY MISTER-
BINDER. IN JANUARY AND IT SHOULD
THE- NUMBERS GROWING 66%
SUPPORT. EVEN THOUGH THE PRICE
OF GAS HAS COME DOWN SINCE THEN.
ALL IN THERE BUT I WILL SAY. IN
RESPONSE TO ONE OF THE- ONE OF
THE OTHER EXPERTS. WIN IS A WIN
FOR A WINDFALL. WHEN THE PROFITS
ARE DOUBLE WHAT YOUR STANDARD
PROFITS ARE. WHEN THE PROFITS
ARE ONLY ECLIPSE THREE TIMES IN
THE LAST TWENTY YEARS. THAT'S
WHEN A WINDFALL IS A WINDFALL
AND THAT'S WHAT WE HAVE TO TAKE
. IT BACK AS A STATE. THANK YOU.
THANK YOU NEXT UP IS MR WE-
THANK YOU MISTER CHAIRMAN JOHN
LINGER HERE ON BEHALF OF THE
CALIFORNIA FUELS AND CONVENIENCE
ALLIANCE. OUR MEMBERS MAKE UP
THE FUEL SUPPLY CHAIN BELOW THE
REFINERY LEVEL SO THAT INCLUDES
FUEL TRANSPORT. AND RETORT
RETAIL GAS STATIONS WHICH ARE
PRIMARILY SMALL FAMILY. AND
MINORITY OWNED BUSINESSES-
APPRECIATE THE OPPORTUNITY TO
SHARE PERSPECTIVE ON THE
LEGISLATION IN FRONT OF US-
HISTORICALLY CALIFORNIA'S ALWAYS
SEEN. HAS ALWAYS DEALT WITH
ABNORMALLY HIGH GAS PRICES DUE
TO HIGH TAXES AND FEES. YOUR
VIRAL REGULATIONS AND HIGHER
THAN AVERAGE LABOR. AND PROPERTY
COSTS OVER THE LAST DECADE WE
HAVE SEEN A LARGER GAP BETWEEN
CALIFORNIA PRICES IN THE REST OF
THE NATION WHICH IS INCLUDED
EVEN MORE VOLATILE PRICE SPIKES
IN THE MARKET. OUR MEMBERS ARE
ACUTELY AWARE OF THE CHALLENGES
WE SEE IN THE MARKET PLACE AND
WE STRIVE TO PROVIDE RELIABLE
FEEL. AT A COMPETITIVE PRICE TO
ALL OF OUR CUSTOMERS. FOR MORE
MEMBERS PERSPECTIVE NOTHING
ABOUT THE CURRENT SITUATION IS
SURPRISING. OVER THE LAST DECADE
THE LEGISLATURE ADMINISTRATION
HAVE IMPLEMENTED DOZENS OF
POLICIES THAT HAVE REDUCED
REFINERY CAPACITY. AND STRANGLED
SUPPLY IN THE STATE. THIS IS
LESS LEAD TO LESS SLACK IN THE
SUPPLY SYSTEM THAT- RESULTED IN
GREATER RELIANCE ON IMPORTED-
CAR BOB GASOLINE WHICH IS
SUBJECT TO THE SPOT MARKETING
INCREASED PRICE VOLATILITY BY
TRADERS. THIS WILL CONTINUE TO
BE THE CASE IF CARBON OTHERS
CONTINUE TO FOCUS ON ELECTRIC
VEHICLES BEING THE ONLY OPTION
FOR REDUCING EMISSIONS. WE HAVE
ALTERNATIVE FUELS THAT CAN BE
DEPLOYED RIGHT NOW THAT WOULD
DRAMATICALLY REDUCE TAILPIPE
EMISSIONS REDUCE DEMAND ON
GASOLINE. AND MEET THE NEEDS OF
ALL CALIFORNIANS. WITHOUT
EMBRACING. FUELS THE ADOPTION
RATE OF EV'S WILL CONTINUE TO
LAG SIGNIFICANTLY LEAVING DEMAND
FOR FUEL HIGH WILL SUPPLY
CONTINUES TO BE REDUCED. FURTHER
INCREASING COSTS. WHEN LOOKING
AT THE DISPARITY BETWEEN
CALIFORNIA GAS PRICES IN THE
REST OF THE NATION IT'S NOT JUST
THE TAXES AND ENVIRONMENTAL
PROGRAMS THAT MAKE UP THE
DIFFERENCE. IT'S ALSO THE
GROWING COST WE'VE SEEN AT THE
RETAIL LEVEL- IT'S- BEEN
REFERRED TO AS A MYSTERY
SURCHARGE TODAY I DON'T THINK
IT'S A MYSTERY FOR US- INCREASE
LABOR COSTS PAGA LAWSUITS. WERE
DONE IN COMPLIANCE COSTS WAS
FORTY TWO DIFFERENT STATE AND
LOCAL AGENCIES EMV UPGRADES
TRUCKING COSTS IN OTHER STATE
MANDATES HAVE MADE IT DIFFICULT.
TO OPERATE- AS A STATION IN
CALIFORNIA AND MANY OF OUR
STATION OWNERS ARE EITHER
LEAVING OR THEY'RE CHOOSING TO-
TO SHIFT THEIR LIABILITIES- OVER
TO BEING A BRANDED STATION. AND
SO- THAT'S INCREASING COSTS
FURTHER THAT'S LIMITING
COMPETITION FURTHER AND I THINK
IT'S BEEN DISCUSSED A FEW TIMES
THAT- THAT THAT'S NOT GOOD ON
THE ON THE STREET LEVEL. AS AN
INDUSTRY WE BELIEVE THEIR
SOLUTIONS TO ADDRESSING THESE
UNIQUE COST TO CALIFORNIA-
HOWEVER WE BELIEVE S. B. X. ONE
DASH TWO WOULD MOVE IN THE WRONG
DIRECTION AS DRAFTED. LEVYING A
TAX ON REFINERS WOULD- WITH WHAT
IS DEEMED AS EXCESS PROFITS TAX-
WE WOULD. ARGUE THAT THERE'D
ONLY BE REALLY TWO OUTCOMES TO
THAT EITHER THE- REFINER HAS TO
PAY THAT TAX AND THAT GETS
PASSED ON TO THE CONSUMER. OR
THEY TRY TO STAY BELOW THAT
THRESHOLD BY LIMITING SUPPLY I
THINK EITHER WAY WE'RE GONNA SEE
EITHER HIGHER COSTS OR- THE
LIMITED SUPPLY AT THE RETAIL
LEVEL- WE SEEN THAT IN THE
SEVENTIES WITH LONG LINES AT THE
PUMP. WE SAW THAT IN THE
EIGHTIES WITH INCREASED PRICES
AND REDUCED SUPPLY AND SO-
INSTEAD OF GOING DOWN THE SAME
FAILED- ROAD THAT WE'VE BEEN
DOWN BEFORE WE BELIEVE THE
LEGISLATURE SHOULD FOCUS
SOLUTIONS ON. STABILIZING SUPPLY
WHEN THERE ARE DISRUPTIONS
REDUCING REDUNDANT UNNECESSARY
REGULATIONS AT THE RETAIL LEVEL
AND EMBRACING ALTERNATIVE FUELS
THAT CAN HELP DRIVE DOWN DEMAND
AT A FASTER RATE. SO THANK YOU
AGAIN AND HAPPY ANSWERING
QUESTIONS. THANK YOU NEXT UP WE
HAVE CASEY SIGO SENIOR COMES
COUNCIL WITH THE CLIMATE. LAW
INSTITUTE. THANK YOU AND A BIG
THANK YOU TO GOVERNOR NEWSOM AND
SENATOR SKINNER FOR THIS
URGENTLY NEEDED. LEGISLATION AND
I WANT TO ADDRESS THE OIL
INDUSTRY'S ATTEMPTS. TO BLAME
THE STATE'S LIFESAVING HEALTH
AND SAFETY PROTECTION LAWS
INSTEAD OF THEIR OWN PRICE
GOUGING FOR HIGH GAS PRICES.
THIS IS BEEN GOING ON FOR YEARS
BUT TODAY'S EXAMPLE IS A
DISHONEST EFFORT TO OVERTURN SB
ELEVEN THIRTY SEVEN. WHICH
PROTECTS THE MORE THAN TWO
MILLION CALIFORNIANS TO LIVE
WITHIN THIRTY TWO HUNDRED SEAT.
OF TOXIC OIL DRILLING OPERATIONS
AND THANK YOU SENATOR COLLINS
GONZALEZ SO MUCH FOR YOUR BILL.
THE OIL AND- ARGUMENT AGAINST
THE BILL IS THAT IT WILL DRIVE
UP GAS PRICES BY DECREASING IN
STATE PRODUCTION. AND SO WHILE I
AGREE WITH SEVERIN BORENSTEIN
THE IN STATE CRUDE OIL
PRODUCTION LEVELS ARE NOT
ACTUALLY RELEVANT. TO TODAY'S
GAS PRICES. IT'S A RELEVANT TO
BECAUSE THE OIL INDUSTRY JUST
SPENT TWENTY MILLION DOLLARS TO
QUALIFY THE REFERENDUM ON IT
WITH THIS PRECISE ARGUMENT. SO
IN THE WRITTEN MATERIALS THAT I
PROVIDED YOU SEE ON PAGE TWO
THERE'S A GRASS CALIFORNIA
PRODUCTION OF CRUDE OIL FROM THE
U. S. ENERGY INFORMATION
ADMINISTRATION. YOU CAN SEE THE
LONG TERM STEADY DECLINE SINCE
NINETEEN EIGHTY SIX THAT'S
BECAUSE THE EASY OIL AND THE
HIGH QUALITY OIL IS LONG GONE.
AND SO INDUSTRY HAS TO USE MORE
ENERGY MORE TOXIC CHEMICALS I DO
EVER MORE DAMAGE TO OUR HEALTH
AND CLIMATE TO GET IN EVERY
DECREASING I'M OUT. OF LOWER
QUALITY OIL SO HEALTH AND
CLIMATE PROTECTIONS ARE NOT THE
CAUSE. OF THE LONG TERM TERMINAL
DECLINE OF CALIFORNIA OIL
PRODUCTION. BUT THESE
PROTECTIONS ARE ABSOLUTELY
ESSENTIAL TO LIMIT THE
ADDITIONAL HARM THAT THE OIL
INDUSTRY IS GOING TO DO ON ITS
WAY OUT THE DOOR. INDUSTRIES TO
TACK ON SB ELEVEN THIRTY SEVEN
IS A DIRECT ATTACK ON THE
COMMUNITIES OF COLOR TO
DISPROPORTIONATELY HARMED. BY
THE BILL BE DANGEROUS
NEIGHBORHOOD OIL DRILLING IT IS
GONE ON FOR FAR TOO LONG. AND
MAKE NO MISTAKE AS THE CLIMATE
EMERGENCY INTENSIFIES. THIS
INDUSTRY KNOWS ITS DAYS ARE
NUMBERED IT'S DOING EVERYTHING
POSSIBLE TO MAXIMIZE ITS PROFITS
AND STATE CALIFORNIANS WITH THE
BILL. AND THE PAIN AT THE PUMP.
THE INDUSTRY HAS CAUSED EVEN
INSTEAD DEMAND FOR GAS LINE IS
DECLINING IT'S JUST ONE SLICE OF
THE DEVASTATION IN HIS
INTENTIONALLY. INFLICTED NO FOR
OVER HALF THIS. THAT PROUD REX
CLAIM. IT WILL SHOW TO LIE ABOUT
THE- AND BLOCK ANY SHIFT TO
RENEWABLE CLEANER. PACKAGE AGO
AT. CLIMATE MODELS WERE THAN NOW
. AT PREDICTING WARM. AND YET
OIL AND ON A DECENT CAN THAT IS
SO. IN ITS AND SCOPE. AND SO
HARD THAT IT'S HARD TO BELIEVE
YOUR HEAD OF IT. AND THAT'S WHY
I'VE INCLUDE IN YOUR- IN HAND
OUT A MEMO THE U. S. HOUSE BRICK
. INVESTIGATION OF THE FOSSIL
FUEL INDUSTRY DISINFORMATION IT
FOCUSES NOT JUST ON THE LIES
ABOUT THE SCIENCE BUT THE WAYS
IN WHICH INDUSTRY CONTINUES TO
BLOCK PROGRESS. THROUGH
GREENWASHING AND PROMOTING FALSE
SOLUTIONS THAT ARE DESIGNED TO
PROLONG THE USE OF FOSSIL FUELS.
THE CLIMATE CRISIS INFLICTED ON
US BY BIG OIL IT'S ALREADY
COSTING BILLIONS IT'S GOING TO
GET FAR WORSE IT'S WHY SO MANY
LOCAL GOVERNMENTS IN CALIFORNIA
ARE SUING THE BIG PRODUCERS
JERRY COLLINS RECOVERED SOME. OF
THOSE DAMAGES AND THE FACT THAT
THIS INDUSTRY IS PRICE GOUGING
ON TOP OF ALL THE OTHER HARM IS
CAUSED IS TRULY STAGGERING. AND
IT'S NOT JUST THE RIP OFF AT THE
PUMP THAT'S THE PROBLEM IT'S THE
LYING. ASTROTURFING TO THE
MANUFACTURER STATE GROUPS TO
OPPOSE CLIMATE POLICY FOR WHICH
WEST BUT AS WELL KNOWN. IT'S THE
VICIOUS ATTACKS ON SCIENTISTS
AND MANUFACTURE OF STEAK EXPERTS
IT'S THE USE OF THE WINDFALL
PROFITS THAT THEY'RE GETTING FOR
LAWSUITS. NOT JUST THE INDUSTRY
CASES AGAINST CLIMATE AND HEALTH
LAWS WHICH ARE LEGION BUT THE
RETALIATORY LAWSUITS LIKE THE
SLAPP SUIT BROUGHT BY SIMBA
ANOTHER OIL TRADE ASSOCIATION
AGAINST ENVIRONMENTAL JUSTICE
YOUTH ADVOCATE. IN LOS ANGELES
IT'S BECAUSE OF ALL THE LINE IN
A DISTRICT OF THE OVERSIGHT
PROVISION. OF THE GOUGING BILL
ARE STILL. INDUSTRY HAS AWAY
WITH THIS BY NOT SHARING KEY
PIECE OF AND- NECESSARY FOR THE
GOVERNMENT TO DO ITS JOB TO
PROTECT OUR CONSUMERS. AGAINST
THE SPREAD BEHAVIOR THE PRICE
GOUGING PENALTY WILL ADD THE
NEEDED TRANSPARENCY AND PREVENT
MORE PREDATORY PRICE SPIKES BY
PENALIZING THE REFINERIES WHEN
THEY OCCUR. ANY WHEN YOU MOVE
THIS CRITICAL LEGISLATION FOR IT
I URGE YOU TO GIVE THE AGENCIES
BUT BROADEST AND STRONGEST
INVESTIGATIVE AUTHORITY AND
CLEAR MANDATES AND DEADLINES TO
GET THE JOB DONE. WE'VE HEARD
SOME ACCUSATIONS TODAY THAT THE
PROPOSAL WON'T WORK OR WILL
COMPLETELY SOLVE THE PROBLEM BUT
THOSE ACCUSATIONS ARE A LOT
EASIER TO MAKE GIVEN THE SECRECY
THIS INDUSTRY HAS ENJOYED.
CALIFORNIANS DESPERATELY NEED
PROTECTION I URGE YOU TO GET
THESE IMPORTANT POLICIES IN
PLACE IF THE AGENCY'S ABILITY TO
JUST BASED ON WHAT THEY FIND.
AND BASED ON CHANGING CONDITIONS
WE'VE HEARD TODAY ALSO HOW
INDUSTRIES RECORD PROFITS FOR
PEAK PRICE SPIKES CAN ONLY BE
EXPLAINED. BY EXTREME
PROFITEERING. IN THAT TO SHIFT
THE BLAME. THE LIFESAVING AND
FIND REGULATE. HAS TO BE REJECT
. SIXTY NINE CENTS FOR
ENVIRONMENTAL PROGRAMS DOES NOT
EXPLAIN THE MORE THAN TRUE
DOLLARS INFLUENTIAL. BETWEEN OUR
PRICES AND ELSEWHERE. AND ON THE
OTHER SIDE OF THE LEDGER FOR
THAT SIXTY NINE CENTS WE GET
PROGRAMS THAT PROTECT THE AIR WE
BREATHE. WATER WE DRINK AND A
LIVABLE CLIMATE ARE HEALTH
EMPLOYMENT LAWS REDUCE ASTHMA
ATTACKS LAW SCHOOL WORKDAYS AND
PREMATURE DEATH. WE NEED THESE
LAWS OF THE OIL INDUSTRY IS
FIGHTING AGAINST TO ACCELERATE
THE TRANSITION TO CLEAN
RENEWABLE ENERGY THAT WILL FREE
US FROM THE FARM THIS INDUSTRY
IS AND WHAT GAME. THIS IS NOT
SOME KIND OF NEUTRAL POLICY
DEBATE THAT IS GOING ON THIS IS
A REALLY A MATTER OF LIFE AND
DEATH AND SO PLEASE DO PROTECT
CALIFORNIANS BY MOVING THIS
CRITICALLY IMPORTANT BILL FORD
WITH THE URGENCY. THAT IT
DESERVES THANK YOU. THANK YOU I
WANT TO BRING IT BACK TO
COMMITTEE FOR QUESTIONS I
APPRECIATE ALL OUR PRISONERS OF
MEMBERS. HAVE QUESTIONS AT THE
START DINNER STERN. YEAH THANK
YOU MR- I GUESS I'LL PICK UP.
WITH THE QUESTION POSED BY THE
LAST PANELIST- THE DELTA BETWEEN
THE. THE SORT OF KNOWN
SURCHARGES SAY THE- GAS TAX-
COST OF SAY ENVIRONMENTAL
PROGRAMS WINTER BLENDED CETERA
SAID. JUST TAKE THAT SNAPCHAT IS
A SIXTY NINE CENTS VERSUS THE
TWO DOLLARS I'M WONDERING EITHER
FROM EITHER THE- FOLKS FROM THE
OF THE DOWNSTREAM SIDE OF THE
UPSTREAM SO THE OIL INDUSTRY-
HOW TO EXPLAIN THAT DOLLAR
THIRTY DELTA. THANK YOU SENATOR
FOR THE QUESTION AND I KNOW JOHN
I'LL JUMP IN HERE TOO- I THINK
WHAT'S REALLY IMPORTANT AS WE GO
FORWARD AND LOOK AT ALL OF THE
SPECIFICS AROUND THIS ISSUE.
THAT WE ALSO SPENT A LITTLE MORE
TIME ON THE COST OF DOING
BUSINESS IN CALIFORNIA BECAUSE
I'M NOT CONVINCED. WE HAVE
CORRECTLY ARTICULATED THE AMOUNT
OF DOLLARS ASSOCIATED WITH THE
COST OF DOING BUSINESS I MEAN ON
THE REFINING SIDE IT'S TWO TIMES
THE COST OF DOING. BUSINESS IN
THE REST OF THE UNITED STATES
HAS A REFINER I KNOW JOHN HAS
THE LIST WE HEARD ABOUT ON THE
COST SIDE THAT I DON'T THINK'S
REFLECTED HERE. SO AS THE ONION
GETS PEELED HERE I THINK WE
REALLY WE ARE DEFINITELY LOOKING
AT IT AND I HOPE THE COMMITTEE
WILL AS WELL WE'RE GOING TO
ENCOURAGE THE ENERGY COMMISSION
TO AND IT'S FEEL TRANSITION
STUDY WHICH CAN BE BY THE WAY A
VERY IMPORTANT. PIECE OF THIS
PUZZLE IS THAT STUDY THEY'LL BE
UNDERTAKING- AND SO I YOU KNOW I
THINK YOU HEARD TODAY THAT IT'S
CERTAINLY NOT REFINERY MARGINS
IS DOWNSTREAM OF THE REFINERY.
AND AS WE BEGIN TO SEE WHAT
THOSE COSTS ARE AND CONTINUE TO
LOOK AT IT GOING FORWARD
HOPEFULLY THAT WILL BRING SOME
ADDITIONAL EXPLANATION SHOULD
JUST SPECULATION AT THIS POINT
NO KNOWLEDGE YOU DON'T HAVE ANY
KNOWLEDGE RUNNING LIST. OF ANY
OF THE DOLLAR THIRTY BEING
ASSOCIATED WITH EXPANDED
REFINERY PROFIT MARGINS. NO AND
IN FACT I COULDN'T AND SHOULDN'T
FOR AS YOU KNOW AND I TRUST
REASONS WE WOULD HAVE NO
INFORMATION ON. ON THAT
SPECIFICALLY BUT- I WOULD SAY
THAT AGAIN. YOU HEARD TODAY ALL
OF THE COMPONENTS THAT GO INTO
THAT. YOU KNOW WE HEARD AND I
HEARD FROM SOME INDUSTRY
REPRESENTATIVES THERE TAKEN AND
FROM OTHERS TO- BUT BUT IT'S
SPECIFICALLY ABOUT THE SADIA
TOBER SEVENTH. DROP THAT'S NOTED
IN ONE OF THE CHARTS HERE FROM A
FROM A SIXTY CENT- REFINING
MARGIN DOWN TO THIRTY SIX. CENTS
A BASIC CLEANING AND HALF
IMMEDIATELY AFTER THE GOVERNOR
ANNOUNCED A SPECIAL SESSION THAT
WE'RE CURRENTLY IN WELL ACTUALLY
WHAT HAPPENED AS A RESULT OF THE
GOVERNOR'S ACTION ON THE WAY
OVER A WINTER SUMMER. IS WHY.
THE MARKET REACTED THE WAY IT
DOES BECAUSE IT COSTS LESS MONEY
TO MAKE WINTER BLEND IN THE
MARKET TOOK ADVANTAGE OF HAVING
A REDUCED PRICE NOTHING TO DO
WITH A PRESS RELEASE THAT HAD TO
DO WITH A WAIVER THAT BROUGHT
MORE SUPPLY. MORE MORE
AFFORDABLE SUPPLY TO MARKET
WINDED THAT SUPPLY COME INTO THE
MARKET. LATER IN OCTOBER IS MY
UNDERSTANDING I THOUGHT LIKE AT
THE BACK END OF OCTOBER AND THIS
DROP WAS BEFORE THAT PLANNED
ACTUALLY CAME ONLINE SO. I'M
JUST TRYING TO PUT THOSE FACTS
TOGETHER BECAUSE IT. IF YOU SAY
IT'S JUST APPLYING DEMAND. THAT
DOESN'T QUITE LINE UP AT THE
TIME SO. WELL IN A LAYER- THAT'S
A SPECIFICALLY OF A LAYER OCEAN
TO THE OTHER THING I WOULD SAY
SENATOR IS. AT TO THE COMMITTEE
I HAVE NOT HEARD THIS ENTIRE DAY
OR AFTERNOON. ABOUT THE
REDUCTION. IN EARNINGS FROM
THESE COMPANIES AND TWENTY
FOURTEEN AND TWENTY FIFTEEN AND
TWENTY TWENTY THE BILLIONS OF
DOLLARS THAT WERE LOST WHEN YOU
LOOK AT. AN ANNUALIZED THREE
YEAR PERIOD FIVE YEAR PERIOD
WHICH IS HOW ANYONE LOOKS AT
EARNINGS. WE ARE WELL BELOW. S.
AND P. FIVE HUNDRED COMPANIES IT
COMPANIES COMMUNICATIONS
COMPANIES. HEALTH CARE INDUSTRY
. SO I WOULD IMAGINE THIS
COMMITTEE IS GOING TO BE JUST AS
INTERESTED IN THOSE EARNINGS
THAT ARE WELL ABOVE THIS
INDUSTRIES WHEN YOU TAKE INTO
FAQ IS A CYCLIC IT'S A CYCLING
INDUSTRY AND THERE ARE UPS AND
DOWNS AND THAT'S HOW YOU SHOULD
LOOK AT EARNINGS. THAT SO YOU
SHOULD LOOK AT RETURN ON
INVESTMENT IT SHOULDN'T BE
SNAPSHOTS OF THREE POINTS IN
TIME. OTHER WORDS THE PROFITS
THAT WERE DERIVED DURING THIS
LAST CYCLE- THERE WAS A PRESSURE
ON THE OIL COMPANIES TO COLLECT
THOSE LARGE PROFITS TO DELIVER
SHAREHOLDER DIVIDENDS BECAUSE
THEY HADN'T COLLECTED THAT PRIOR
KNOWLEDGE IS BASIC MARKET SUPPLY
AND DEMAND. THE PRICE GOES UP
THE PRICE GOES DOWN IT'S BASED
ON SUPPLY AND DEMAND. AND THAT'S
FOR EVERY COMMODITY- ANY GLOBAL
COMMODITY AND THAT'S HOW
BUSINESSES OPERATE SO YOU WOULD.
ASSERT PERFECT COMPETITION IN
THIS MARKET PLACE THAT IT'S A
PERFECTLY FUNCTIONING MARKET I
THINK COMPETITION IS VERY GOOD
IN ANY MARKET PLACE AND I THINK
IS ANOTHER. ANALYSTS MENTIONED I
AM CONCERNED OVER. THE STATE'S
ALLOWANCE OF REDUCED. GAS
STATIONS THROUGHOUT THE STATE
TAKEN BY LOCAL CITIES AND
COUNTIES. THIS IS NOT INCREASED
COMPETITION THIS IS NOT. THE
DIRECTION WE SHOULD BE GOING AND
LIMITING GAS STATIONS DURING
THIS PERIOD OF TIME. SENATOR
DOLLARS. THANK YOU VERY MUCH-
FIRST I HAVE A QUESTION FOR MR
COURT- ON THE VIRTUAL LINE HERE
ABOUT THANK YOU SO MUCH FOR YOUR
PRESENTATION- ABOUT THE FIFTY
CENTS CAP IT WOULD THERE BE. IS
THERE ARE OTHER BEEN DISCUSSIONS
ABOUT POTENTIALLY A RANGE IN
THAT CAP. I JUST I JUST LEVELED
OFF AT FIFTY CENTS FOR THE
PURPOSES OF- SHOWING HOW
EXTRAORDINARY THAT LINE WAS THAT
ONLY THREE TIMES IN THE LAST.
TWENTY YEARS IT WAS IT WAS
EXCEEDED BUT I THINK THE
LEGISLATION ITSELF DOES TAPER IN
THE- THE PENALTY AND WHAT THE
GOVERNOR WHAT THE GOVERNOR'S
OFFICE WAS PRESENTED TODAY IS A
LITTLE DIFFERENT TOO. THEY WERE
TALKING I BELIEVE ABOUT IT IN
THE IN THE DALE IN A DAY WHEN
THAT REFINING MARGIN GOES UP AS
OPPOSED TO LOOKING AT OVER A
PERIOD OF TIME BUT- THE
PRINCIPLES THE SAME- YOU EVEN IF
YOU IF YOU IF YOU IF YOU SET AN
UPPER LIMIT. WHERE THERE'S A
PENALTY YOU KEEP IT WITHIN A
FAIR PLAYING RANGE. OKAY THANK
YOU VERY MUCH- AND CAN YOU JUST
GO OVER ANOTHER YOU HAD ONE
SLIDE- REGARDING THE- POLLING
ABOUT CALIFORNIANS IN ABOUT TWO
THIRDS OF CALIFORNIANS YES- CAN
YOU JUST GO OVER THAT A BIT AND
THEN WHAT ARE THE ATTRIBUTING.
THESE EXCESSIVE PROCESS PROFITS
. TO WELL IT IN THE POLL THAT WE
DID- THEY BELIEVE IT'S PRICE
GOUGING THEY BELIEVE IT'S PRICE
GOUGING MORE AT THE END OF IT
AND FIRE METAL POLICY OR TAXES-
AND THEY BELIEVE THAT- THAT IS
IT IT'S THE OIL COMPANIES-
PENALIZING THEM- AND THAT'S WHY
THEY WANT TO TAKE. THAT THAT
THAT THAT THAT MONEY BACK UP.
AND IN THE POLL THAT BINDER DID
HE HE BROKE IT DOWN A LITTLE BIT
MORE BY DEMOGRAPHICS. THE THING
ABOUT THE DEMOGRAPHICS ARE IT IS
ACROSS THE BOARD LARGELY- IN
ALMOST EVERY DEMOGRAPHICS EXCEPT
FOR WHITE REPUBLICAN MEN. THAT
SUPPORT THIS PENALTY. OKAY
THAT'S WHAT I'M SAYING TO
ACROSS- AND REGIONAL IT SEEMS TO
BE THE SAME OVER. OVER
OVERWHELMINGLY 60% SUPPORT THIS
. THIS AND THAT'S AFTER THE
ARGUMENTS AGAINST IT AS WELL
THAT WAS THE INTERESTING THING
WE GIVE ARGUMENTS FOR DAVE
ARGUMENTS AGAINST IN THE VOTE
AFTER THE ARGUMENTS AGAINST-
CAME OUT OVER 60% OKAY THANK YOU
VERY MUCH AND THEN- I HAVE A
QUESTION OF COURSE THE QUESTIONS
FOR- MYSTERIES VOID AS WELL AS
MISTER WENGER- I THINK YOU'D
MENTIONED MYSTERIES VOID ABOUT
THE YOUR FIDUCIARY
RESPONSIBILITY IT'S NOT INCUR
TAXES AND FEES SO CAN YOU
EXPLAIN. TO VIOLATE THE LAW.
OKAY CAN YOU EXPLAIN WITH. SO IF
YOU IF YOU HAVE A CAP IN PLACE-
WE CANNOT VIOLATE THE LAW AND SO
REFINERS WILL HAVE TO MAKE
DECISIONS ON TO HOW TO MAKE SURE
THEY HAVE A FIDUCIARY
RESPONSIBILITY TO COMPLY WITH
THE LAW. AND SO AGAIN THIS
POLICY IS NOT ONE THAT WE
BELIEVE WILL HELP THE INTENDED-
THE INTENDED RESULT THAT YOU
WOULD ALL EXPECT AND SO I THINK
THERE ARE BETTER WAYS AS WE'VE
DISCUSSED TO LOOK AT THE PRICE
PRESSURES AT THE PUMP WHICH IS I
THINK WHAT WE'RE ALL HERE FOR
IT'S NOT ABOUT. EARNINGS OR
PROFITS IT'S ABOUT RELIEF AT THE
PUMP AND I THINK. YOU KNOW WE'VE
TALKED ABOUT WAYS TO DEAL WITH
THAT INCLUDING IMPROVED
INFRASTRUCTURE INCLUDE
PERMITTING INCLUDE SUPPORT FOR
CCS AND HYDROGEN A RENEWABLE
NEED DIESEL RENEWABLE NATURAL
GAS ALL OF WHICH ARE COMPANIES
ARE DOING IN SPADES. AND TO DO
THINGS IN THE IMMEDIATE TERM
LENDS PRICE WHEN PRICE SPIKES
HAPPENED LIKE WAIVER ON WINTER
TO SUMMER. PERHAPS LOOKING AT
SOMETHING ON IMPROVE COMPETITION
IS ONE OF THE IKONOMIDIS HAD
MENTIONED FROM BRINGING CARBON
TO THE STATE WHICH IS VERY
DIFFICULT BECAUSE NOT MANY
PRODUCES IT TAKES A LONG TIME TO
GET HERE. SO THERE'S THINGS I
THINK LIKE THAT TO REALLY
EXPLORE AS WE PEEL THE ONION BUT
THIS IS THIS BILL IS NOT ONE OF
THEM. AND SO I GUESS MAKE MY
LAST QUESTION TO BOTH OF YOU IS
YOU KNOW GIVEN. YOUR IS
FIDUCIARY RESPONSIBILITY AS YOU
CLAIM AND- KNOWING THAT OVER THE
LAST YEAR. I MEAN IT SEEMS
PRETTY CLEAR TO ME TWO HUNDRED
BILLION DOLLARS. IT'S QUITE A
LOT OF MONEY- FOR FIVE OF THE
LARGEST OIL COMPANIES TO BE
MAKING. WHILE CALIFORNIANS WERE
PAYING THE MOST AT THE PUMP
ACROSS THE COUNTRY I MEAN DO YOU
NOT FIND THE SUCCESSIVE AND IF
YOU DON'T. WHY NOT. AGAIN I
THINK I ANSWERED THE QUESTION
PREVIOUSLY YOU LOOK AT EARNINGS
OVER A PERIOD OF TIME AND OUR
EARNINGS ARE WELL BELOW MANY
MANY OF THE S. AND P. FIVE
HUNDRED COMPANIES AND SO. IT IS
A HISTORIC EARNINGS THOUGH NO
THEY ARE AND THEY'RE NOT THAT
HISTORIC THERE IN THE LAST THREE
ANALYZE YEARS SO IF WE HAVEN'T
SUBMITTED THAT MATERIAL TO YOU
WE WILL. BECAUSE THAT- THOSE
GRAPHS CERTAIN AND DATA ARE
READILY AVAILABLE CERTAINLY FROM
THE FEDERAL GOVERNMENT AND THE
STATE GOVERNMENT SO. AGAIN I
THINK- AS WE LOOK AT THIS ISSUE
LET'S REALLY FOCUS ON RELIEF AT
THE PUMP. AND IT IS NOT THROUGH
A PRICE CAP- AS PROPOSED IN THIS
BILL THERE ARE OTHER WAYS TO
DEAL WITH- RELIEF AT THE PUMP
AND THIS IS NOT ONE OF THEM.
MISTER WINNER WHICH LIKE TO
RESPOND YEAH I CAN'T SPEAK TO
THE FIVE- COMPANIES I REPRESENT
THE TWELVE THOUSAND YOU KNOW
SMALL MOM AND POP GAS STATIONS
IN THE IN THE STATE- BUT I
THINK. YOU KNOW THOSE RESULTS AS
A RESULT OF PRICES GOING UP NOT
THE BECAUSE- THE CAUSES VERY
CLEARLY LACK OF SUPPLY. AND
EVERY TIME WE SEE SOMETHING
HAPPEN AT A REFINERY ON PLANNED
MAINTENANCE WHERE THE SUPPLY.
SUDDENLY GOES DOWN WE SEE- THE
STOCK MARKET THE INCREASE WE SEE
BY TRADERS. JACK THE PRICE UP
AND- IT'S JUST IT'S AN EXTREMELY
VOLATILE MARKET FOR OUR FOLKS AT
THE RETAIL LEVEL TRYING TO
FIGURE OUT HOW THE HOW THE
MARKET'S GONNA WORK ONE ONE
MARKETER TOLD ME IN IN SAN
FRANCISCO. YOU KNOW THERE'S SUCH
LITTLE LIQUIDITY THERE THAT- ONE
TRADE COULD IMPACT THE PRICE
SIGNIFICANTLY SO IT'S- IT'S A
VERY DIFFICULT. THING TO PREDICT
AT THE STREET LEVEL. FIVE JUST
MY LAST COMMENT IT'S NOT A
QUESTION IS LESS COMMON IT IS
YOU KNOW- A LOT OF. BILLIONS OF
DOLLARS THIRTY FOUR BILLION IN
LOBBYING LAST YEAR- TWENTY
MILLION SPENT TO OVERTURN A LOT
OF PROTECT HEALTH. OF FOR
CALIFORNIANS. AND TWENTY YEAH
TWENTY MILLION IN SIGNATURE
SIGNATURE GATHERING- TO OVERTURN
THIS LAW. ALONG WITH- ADDITIONAL
FIFTY BILLION DOLLARS JUST WITH
EGGS ON FOR STOCK. BUYBACKS I
WOULD THINK THAT THAT THOSE
DOLLARS BILLIONS OF DOLLARS
BEING SPENT ON THIS COULD HAVE
BEEN USED. TO ACTUALLY SUPPORT
CALIFORNIANS TO ACTUALLY BEEN
USED TO PROVIDE COMPETITION
HERE. TO TRANSITION AS WE'VE
BEEN TO TALKING ABOUT AND I
DON'T SEE THAT. AS OF THIS IS
WHY WE I THINK YOU KNOW
WHOLEHEARTEDLY WE NEED TO ASK
THESE QUESTIONS AND FIND OUT
MORE FROM EACH AND EVERYONE OF
YOU ON ON DATA AND THE
TRANSPARENCY THAT IS NEEDED FOR
EVERY CALIFORNIANS SO. THAT WITH
ALL DUE RESPECT SENATOR WE HAVE
AN ARE INVESTING BILLIONS OF
DOLLARS IN ALTERNATIVE RENEWABLE
FUELS IN HYDROGEN AND CCS AND
EVERYTHING THE STATE NEEDS TO
MEET ITS CLIMATE CHANGE GOALS WE
ARE NOT OPPOSED TO THOSE GOALS
WE JUST THINK THERE'S A MORE
AFFORDABLE PATH TO GET THERE.
AND WE ARE NOT INVOLVED IN
FUNDING THE REFERENDUM WAS BUT
IS NOT INVOLVED IN FUNDING THE
REFERENDUM MY MEMBERS ARE NOT
INVOLVED IN REFER IN FUNDING THE
REFERENDUM. THAT DOES NOT MEAN
THAT I MEAN WE SUPPORT SET BACKS
WE JUST SUPPORT IN THAT ARE THAT
ARE BASED ON SCIENCE AND FACTS
BUT WE ARE NOT INVOLVED IN THE
REFERENDUM THAT YOU'RE REFERRING
TO. AND WE ARE NOT SPENDING
DOLLARS SUPPORTING IT. WELL THE
SB ELEVEN THIRTY SEVEN HAD A-
SLEUTH PANELISTS. THAT DIDN'T
FACTS STATE THAT. A SETBACK WAS
WAS NEEDED SO THEIR ADDRESSES
MANY CENTERING RIGHT JUST THAT
HAVE ALTERNATIVE FOR USE. THANK
YOU A CENTER ASTRI. THANK YOU
VERY MUCH AND I JUST WHILE I
APPRECIATE THE PREVIOUS TWO SETS
OF PANELISTS THIS THIS PANEL IS
PROBABLY JUST A LITTLE MORE MY
SPEED REALLY. REALLY CLEAR. WHO
YOU'RE WITH AND WHAT I STAND
FOR. ALL FOUR OF YOU AND-
PASSIONATELY ADVOCATING ON
BEHALF OF. YOUR ORGANIZATIONS SO
LITTLE EASIER FOR ME TO SORT OF
WALK THROUGH. AND I APPRECIATE
THAT AND I YEAH I PARTICULARLY.
RESHOOT TO THE BALANCE ON THIS
PARTICULAR PANEL MISPLAYED AND
MISS SIEGEL IF YOU HADN'T SHOWN
UP TODAY. WE WOULD HAVE HEARD
FROM NINE MEN PANELISTS AND I'M
I'M GLAD TO SEE BOTH. THANK YOU
FOR BEING HERE IN TAKING SOME
TIME IN BRINGING YOUR EXPERTISE
BOTH OF YOU ALL OF YOU TO THE
EQUATION. MISTER WENGER YOU ARE
NOT WRONG I COME FROM LOCAL
GOVERNMENTS. LIKE YOU KNOW THREE
MONTHS AGO I WAS A VICE MAYOR
AND TODAY I'M A SENATOR. IT IS
NOT EASY TO OPEN A GAS STATION
IN A IN A BIG CITY IN CALIFORNIA
AND IT IS. I DON'T EVEN KNOW IF
IT'S POSSIBLE FOR A SMALL
INDEPENDENT RIGHT NOW THAT WOULD
BE REALLY CHALLENGING- SO YOU
KNOW THERE IS YOU YOU MAKE GOOD
POINTS. ALL OF YOU AND I REALLY
ACTUALLY QUITE ENJOYED HEARING
THE PASSIONATE- DISPLAY FROM ALL
FOUR PANELISTS INCLUDING THE TWO
ON NOT. ON ZOOM IT COMES ACROSS
THAT MR CORDOBA SIEGEL IN CASE
YOU'RE WONDERING YOU SOUND JUST
AS PASSIONATE ACROSS THE SCREEN
AS AS THEY DO HERE IN PERSON. I
DO HAVE ONE QUESTION AND IT'S
REALLY JUST BECAUSE ACTUALLY
AFTER ALL THIS TIME TODAY I
HAVEN'T HEARD IT ADDRESS AND-
DESPITE IT'S PROBABLY BASS. HAD
POSED TO YOU. IN THE GOVERNOR'S
PROPOSAL PART OF WHAT HE TALKS
ABOUT AND FOR PART OF WHAT I'VE
HEARD A LOT ABOUT. HIS AROUND
WHEN THE REFINERIES CAN SHUT
DOWN FOR MAINTENANCE I
UNDERSTAND THAT NEEDS TO HAPPEN
THAT'S OBVIOUS ALSO UNDERSTAND
THAT THERE COULD BE A VARIETY OF
REASONS WHY THAT NEEDS TO HAPPEN
. BUT I'VE ALSO HEARD. PART OF
THE DISCUSSION BE AROUND IF
MULTIPLE REFINERIES SHUT DOWN AT
THE SAME TIME. THAT CREATES A
SUPPLY ISSUE I'VE ALSO HEARD
MANY PEOPLE TELL US TODAY THAT
THIS IS ABOUT A SUPPLY ISSUE. SO
WOULDN'T THERE BE SOME
RATIONALITY AT LEAST
COORDINATING AND DISCUSS YOU
DISCUSSING WHEN REFINERIES WOULD
SHUT DOWN SO THAT. THEY DIDN'T
ALL DO IT AT THE SAME TIME OR SO
THAT THE STATE COULD PLAN. FOR
SUCH AN INSTANCE BECAUSE TO ME
THAT THAT SEEMS TO BE A
CONFLICTING ISSUE HERE. CAN YOU
HELP ME BETTER UNDERSTAND THAT
YES THAT'S A GREAT QUESTION
THANK YOU FOR IT- OUR COMPANY'S
REPORT TURNAROUND INFORMATION TO
THE DEPARTMENT OF INDUSTRIAL
RELATIONS- OTHER INFORMATION IS
REPORTED TO THE ENERGY
COMMISSION AS YOU KNOW ON THE ON
THE MARKET SIDE- OFTEN THE
ENERGY COMMISSION CALLS OUR
MEMBERS AND ASK THESE QUESTIONS
AND THERE'S INFORMAL
CONVERSATIONS AND SHARING OF
INFORMATION THAT IS PART OF A
PROTECTED. AND I THINK THE
BIGGEST ISSUE FOR US IS AS LONG
AS AND IT SHOULD BE FOR THIS
COMMISSION AND I THINK THE
ENERGY COMMISSION AND THE
ATTORNEY GENERAL WOULD AGREE IT
SHOULD BE PROTECTED UNDER PIRA.
AND SO IF THAT IS- SOME
INFORMATION COORDINATION BETWEEN
THOSE TWO AGENCIES THAT NEED TO
OCCUR- WE CERTAINLY HAVE A ARE
VERY OPEN TO TALKING ABOUT THAT.
ON THE TRANSPARENCY SIDE- EVEN
WITH S. B. THIRTEEN TWENTY TWO-
COM. SENATOR STERN WITH ALL DUE
RESPECT- WE VERY MUCH- ALTHOUGH
WE DIDN'T SUPPORT THE BILL AND
WE DO SUPPORT THE BILL NOT
BECAUSE OF THE BILL ITSELF WOULD
IN SUPPORT OF BECAUSE NOT THE
CLARITY IT NEEDED. FOR COMPANIES
TO GIVE THEM THE DATA THAT
ACTUALLY WOULD BENEFIT THE
ENERGY COMMISSION IS SOME
CONSISTENT MANNER. HAS SO WE-
RECEIVED LETTERS FROM THE ENERGY
COMMISSION ENCOURAGING US TO
REQUEST A RULEMAKING WHICH WE
DID IN A LETTER TO THEM WHISPER
RECEIVE THIS LETTER EVERY
REFINERY RECEIVED THIS LETTER WE
RESPONDED IN ASKING FOR RULE
MAKING- I WAS CALLED BY THE
ENERGY COMMISSION TO SAY THAT
WASN'T THE RIGHT PROCESS AND I
SAID. OKAY GOOD TO KNOW WHAT IS
THE RIGHT PROCESS YOU NEED TO
PETITION. AND OKAY GREAT HOW DO
WE DO THAT THE TO FIND IT FORCE
WE PETITIONED. AS DID BRIEFINGS
WITH EVERY. ENTERED COMMISSION
ARE SO ONE WHO'S BEING. AND OUR
ON OUR OUR DESIRE TO PROVIDE
CONSISTENCY AND DATA FROM THE
REFINERS SO THAT THE ENERGY
COMMISSION GETS THE INFORMATION
NOT FROM SEVEN DIFFERENT
INTERPRETATIONS BUT THERE IS
SOME- DATA THAT'S PROVIDED THAT
CAN BE OF BENEFIT. THIS WAS ALL
IN THE SPIRIT OF TRANSPARENCY
THAT PETITION WAS DENIED IN A
TWELVE HOUR PERIOD AFTER ALL ALL
THE PREVIEWS HAD TAKEN PLACE.
AND THE ANSWER I WAS GIVEN WAS
FRANKLY BECAUSE THERE'S
INFORMATION ALLEN THIS HEARING
WERE BEING DISCUSSED AND SO WE
DON'T THINK WE SHOULD SPEND TIME
ON A RULE MAKING IN THIRTEEN
TWENTY TWO. I WAS APPALLED. AND
SO I THINK. WHEN WE TALK
TRANSPARENCY WERE ALL ABOUT IT.
AND ANY ASSERTIONS THAT WERE
NOT. IS ARE TOTALLY INCORRECT
SO. JUST ONE ON THIS WILL BE MY
FINAL. SORT OF QUESTION ON IT. I
HEAR THE FRUSTRATION BUT I ALSO
HEARD IN THEIR- AN OPENNESS TO
SOME KIND OF DIALOGUE AROUND
COORDINATION OF WIN THE
REFINERIES DO MAINTENANCE IS
SHUT DOWN AS LONG AS YOU CAN BE
ASSURED SOME PRIVACY GUARANTEES.
WHICH COULD POTENTIALLY BE
HELPFUL IN THIS DISCUSSION
BECAUSE- YOU CAN'T BOTH SAY THAT
IT'S SUPPLY AND THEN ALSO SAY
THAT. YOU KNOW SHUTTING OFF
SUPPLY AT THE SAME TIME DOESN'T
CREATE THE ISSUE SO I APPRECIATE
THAT THANK YOU. THANK YOU
SENATORS ARE CHOICE CHAU TO. C.
R. THANK YOU. NOT A PROBLEM.
WELL THERE'S BEEN AN INTERESTING
DAY- THAT AND I COULD SUMMARIZE
WHAT I'VE LEARNED TODAY. BY YOU
JUST SAYING THAT. YOU KNOW
OBVIOUSLY. THERE ARE A THOUSAND
DIFFERENT OPINIONS. ABOUT THE
OIL INDUSTRY. ABOUT WHAT'S
CAUSING HIGH GAS PRICES ABOUT
THE EFFECT IT'S HAVING ON ON OUR
YOU KNOW ON OUR PEOPLE- AND OUR
ENERGY POLICY ESSENTIALLY AND
THAT'S REALLY WHAT IT ALL BOILS
DOWN TO- I I'M NOT TO REHASH THE
BILL FROM LAST YEAR- BUT I DO
HAVE A QUESTION FOR- MISS
SIEGEL. ARE YOU THERE. A SINGLE
. YES I'M HERE ARE YOU STILL
THERE OKAY. YOU'RE FAMILIAR WITH
A LOT OF THE CITY'S I'M GONNA
LIST HERE LONG BEACH SIGNAL HILL
SAN PEDRO HUNTINGTON BEACH
BEVERLY HILLS EL SEGUNDO.
BALDWIN HILLS CULVER CITY IN
TORRANCE. SUMMERED JUST YEAH
THOSE ARE THOSE ARE CITIES THAT
DAD'S OF GOODS THE BATTALION
CHIEF I USED TO. GET TO COVER.
AND ALL OF THOSE CITIES ARE
CITIES THAT- I DON'T KNOW THAT I
WOULD CHARACTERIZE THEM AS A
MINORITY OR DISADVANTAGED
COMMUNITIES AND YET MOST OF THE
OIL WELLS THAT WE- ARE WHAT
WE'RE AWARE OF WE DON'T HAVE TO
DEAL WITH THEM VERY MUCH. WE'RE
ALL LOCATED IN THOSE COMMUNITIES
AND- THE COMMUNITIES THAT WERE
THERE- THE HOUSES THAT WERE
WITHIN THE PRESCRIBED OF
DISTANCE THAT WE'RE SUPPOSED TO
BE HARMFUL- WE'RE NOT- HOUSES
THAT I COULD AFFORD- AND SO I'M
I'M KIND OF CURIOUS. WHICH OF
THE POOR COMMUNITIES ARE YOU
TALKING ABOUT THAT YOU FOUND
THESE OIL WELLS THAT ARE DOING
THIS DAMAGE TO OUR COMMUNITIES.
YES TO OVER TWO MILLION PEOPLE
IN CALIFORNIA LIVE WITHIN THIRTY
TWO HUNDRED FEET. OF A TOXIC OIL
AND GAS WELL AND SO THAT THAT
PEOPLE FROM ALL WALKS OF LIFE-
LIVE NEAR NEAR THESE WELL SO
THAT IS TRUE. EVERYBODY IS
AFFECTED BUT THESE WELLS ARE
DISPROPORTIONATELY LOCATED IN
LOW INCOME COMMUNITIES OF COLOR
THAT ALREADY GREASE. SOME OF THE
UNHEALTHIEST CARE IN THE NATION.
LOS ANGELES IN PARTICULAR LOS
ANGELES HAS THE COUNTRY'S
LARGEST URBAN OIL FIELD. YEAH
YOU KNOW IT'S CHILDREN AND THE
ELDERLY THAT THAT ARE MOST
AFFECTED RIGHT AND SO. THIS IS
VERY DANGEROUS STOCKS YOU DO NOT
WANT TO BE LIVING NEXT TO AN OIL
WELL. PEOPLE WHO LIVE NEAR THAT
STUFF THEY GET HEADACHES THEY
GET NOSE BLEEDS THEY GET
NAUSEOUS ONE YOUNG. WOMAN I
ELLIE CALDWELL WHO WON THE
GOLDMAN PRIZE FOR ENVIRONMENTAL
ACTIVISM THIS YEAR SHE GREW UP
NEXT TO MODEL WELL SHE HAD TO
SLEEP. SITTING UP IN A CHAIR SO
HE WOULDN'T CHOKE ON HER OWN
BLOOD FROM THE NOSE BLEEDS THAT
SHE GOT FROM THIS TOXIC AIR
POLLUTION. AND OVER THE LONG
TERM. THESE CHEMICALS INCREASE
YOUR RISK OF CANCER BUT INCREASE
THE RISK. OF DEATH REMOVED FROM
CARDIOVASCULAR DISEASE AND MAY
EVEN. HARM BABIES. IN THEIR
MOTHER'S WOMB. AND SO IT IS SO
CRITICAL THAT WE PROTECT
CALIFORNIANS FROM THIS TOXIC
INDUSTRY IT'S COULD CALIFORNIA
IS ONE OF THE LAST STATES IN THE
NATION THAT DID NOT HAVE A
HEALTHY BUFFER. BETWEEN OIL
WELLS IN HOMES AND SCHOOLS AND
HILL SENATOR GONZALEZ IS BILL
PASSED LAST YEAR SO THAT'S A
LITTLE BIT ABOUT SOME OF THE
PEOPLE IN THE COMMUNITIES THAT
I'M TALKING ABOUT. AND THANK YOU
FOR THAT BUT I ALSO KNOW THOSE
COMMUNITIES QUITE WELL AND THE
PEOPLE ARE NOT PACKING UP IN
FLEEING FOR THEIR LIVES. AND
THEY'VE BEEN THERE A LONG TIME
SO- ANOTHER ANOTHER IN THE
VILLAIN IS ATION OF OUR- OUR-
PETROLEUM PRODUCING WORLD-
THERE'S A LOT OF OTHER PRODUCTS
THAT ARE BY PRODUCTS OF
PETROLEUM. AND THEY INCLUDE
MEDICAL SUPPLIES LIKE IVEY'S IV
BAGS- THE BLOOD WHEN YOU GO GIVE
BLOOD THE BLOOD PACKETS THOSE
ARE MADE WITH PETROLEUM
PRODUCTS. FURNITURE WINDMILLS
SOLAR PANELS TYERS ROAD MATERIAL
COOKING FOOD IF WE GOT RID OF
THE OIL INDUSTRY TOMORROW WHAT'S
YOUR PROPOSAL. FOR REPLACING ALL
OF THOSE. YEAH SO HERE THE THING
ABOUT. AND WHERE WE ARE WITH
THINGS RIGHT LIKE. FIFTY YEARS
AGO BRIEFLY IF YOU CAN I'M SORRY
I DON'T KNOW IT'S A LONG SUBJECT
WE DO ALL NIGHT ON IT. YEAH
ABSOLUTELY THERE ARE. WIENER
HEALTHIER ALTERNATIVES FOR OIL
FOR ENERGY USE YOU DIDN'T HEAR
TOO MUCH ABOUT IT TODAY AT THIS
HEARING BUT BUT- BACK IN THE
NOVEMBER OUT TO SEE YOU SEE
HEARING THERE. FOR DIFFERENT
PRESENTATION ON THE
ELECTRIFICATION OF THE VEHICLE
FLEET RIGHT ONE IN FIVE CARS.
CALIFORNIA RIGHT NOW IS AN
ELECTRIC VEHICLE THE TRANSITION
IS STARTING TO HAPPEN THERE ARE
ALTERNATIVES BUT THE OIL
INDUSTRY GROWS. OVER HALF A
CENTURY TO LIE ABOUT THE SCIENCE
PROGRAM I HAD TO MARKET THEIR
PRODUCTS BECAUSE AND THE BLOCKS
ALLUSIONS THE WORLD WOULD BE A
VERY DIFFERENT PLACE RIGHT NOW.
WITH MUCH CLEANER HEALTHIER
SAFER ALTERNATIVES AT THIS
MASSIVE DISINFORMATION CAMPAIGN
NOT BE UNDERTAKEN SO I THANK YOU
FOR YOUR QUESTION AND I. I WOULD
COMMEND TO YOU THE REFERENCES
THAT I PUT ON YOUR HANDOUT THE
TALK ABOUT. THE SCALE OF THE
DISINFORMATION LYING THE
ASTROTURFING AND THE LOBBYING
THAT WE'RE UP AGAINST THIS IS
THE RICHEST AND MOST POWERFUL
INDUSTRY ON EARTH. IT HAS BEEN
SELECTED ALMOST DONE THEM YOU
THINK ABOUT THE NEXT FIVE
MINUTES THANK YOU I. THINK YOU
ANSWERED THE- S. IN A- IT BEEN
IN BASICALLY THERE IS NO. FOR
THEM RIGHT NOW AND SO THAT WOULD
CAUSE A MASSIVE MASSIVE PROBLEM
FOR US IF WE JUST MAKE IT AND MY
POINT IS THIS WE'RE MAKING A
TRANSITION. TO TRY TO BE MORE
ENVIRONMENTALLY CONSCIOUS- WE'RE
TRYING TO DO THINGS THAT ARE
HEALTHIER FOR OUR COMMUNITIES
BUT YOU CAN'T DO OVERNIGHT AND
WHAT WE ARE EXPERIENCING RIGHT
NOW WITH OUR OIL PRICES IS NOT
UNPREDICTABLE THESE ARE THINGS
THAT WE TALKED ABOUT. A FEW
YEARS AGO WHEN THEY'RE TALKING
ABOUT WE'RE GONNA MOVE TOMORROW
TO DO ALL THIS STUFF WELL GUESS
WHAT YOU'VE JUST CREATED A
MARKET THAT IS VERY HIGHLY
SENSITIVE TO US PULLING. BACK ON
THE THINGS THAT WERE USED TO
WHICH IS OIL AND GAS AND THINGS
LIKE THAT. AND MAKING THOSE
PRICES SPIKE. AND WE REALLY
DON'T HAVE ANYTHING TO REPLACE
THEM YET AND WE MAY BY THE WAY
THOSE EVEY VEHICLES ARE MADE
WITH PETROLEUM PRODUCTS- WE
DON'T HAVE ANYTHING TO REPLACE
IT RIGHT NOW WE NEED A BETTER
ENERGY POLICY THAT ALLOWS US TO
MAKE. TRANSITIONS TO THE POINT
THAT WE CAN BECAUSE WE ARE NOT
EVER GOING TO BE NON DEPENDENT
ON THAT VIEW THAT ENERGY SOURCE-
AND THAT'S WHAT. YOU KNOW FOR ME
THAT'S WHAT I'M GETTING OUT OF
THIS IS WE NEED TO BE MORE
COGNIZANT OF THE TRANSITION THAT
WE'RE MAKING AND BE MORE
RESPONSIBLE ABOUT IT BECAUSE
THERE IS WAY TOO MUCH COLLATERAL
DAMAGE. AND THAT COLLATERAL
DAMAGE IS ARE PEOPLE OUT THERE
PAYING SEVEN DOLLARS A GALLON
FOR GAS ME PAYING FIVE HUNDRED
AND FIFTY DOLLARS FOR HEATING.
BECAUSE I DID GET MY ENERGY
REBATE OF FIFTY BUCKS- OTHERWISE
HAVE BEEN SIX HUNDRED TEN AND
THAT'S GOING ON ALL OVER. AND
PEOPLE CAN'T AFFORD THAT. WE'RE
GOING TO WORRY WE HAVE AN ENERGY
POLICY THAT'S CREATING THAT. AND
THEN I APPRECIATE THE OIL
INDUSTRY I APPRECIATE ALL THE
OTHER INDUSTRIES TRYING TO
ADDRESS THIS. BUT YOU KNOW AT
THE END OF THE DAY WE REALLY
NEED TO RE EXAMINE IN THEIR
DIRECTION WE'RE GOING IN. AND
TRY TO MODIFY THAT SO THAT WE
CAN. BE MORE RESPONSIBLE TO OUR
OUR OUR CONSTITUENTS THANK YOU
SENATOR MATT. THANK YOU SURE
RADFORD- I RESPECTFULLY DISAGREE
WITH SOME OF THE COMMENTS OF MY
PREDECESSOR JUST MADE. I DON'T
THINK THIS IS A RESULT IN ENERGY
POLICY I THINK IS THE RESULT OF
A OF. A ECONOMIC MODEL THAT IS
CLEARLY FIGHT NIGHT I WILL JUST
SAY. IN RESPONSE TO MY COLLEAGUE
SENATOR STERN I THINK. ON THIS
FOR YOU SAID THIS IS A
COMPETITIVE MARKET IS WORKING
JUST FINE. I DON'T KNOW HOW YOU
CAN MAKE THAT CLAIM GIVEN WHAT I
UNDERSTAND THAT THIS MARKET
THEIR FIVE PLAYERS IN IN THEIR
FINERY INDUSTRY FIVE PLAYERS. I
WANT TO REVIEW THE DEFINITION
OLIGOPOLY I DON'T HAVE A WHITE
BOARD BUT- I'LL JUST READ TO YOU
A STATE OF LIMITED COMPETITION.
IN WHICH A MARKET IS SHARED BY A
SMALL NUMBER OF PRODUCERS OR
SELLERS. FIVE PRODUCERS I THINK
FITS THAT DEFINITION PRETTY WELL
THIS IS A THINLY TRADED MARKET
THE MARKET AS WE HEARD BEFORE-
FROM A WITNESS WHO TESTIFIED
THAT THERE WERE NO TRADES ON THE
SPOT MARKET IN TWO WEEKS. THAT
IS A MARKET THAT IS RIPE FOR
MANIPULATION. IT'S RIGHT FOR
COORDINATION- AND AS I EXPRESSED
EARLIER I DO HAVE CONCERNS ABOUT
THIS PROPOSAL BUT FROM THE
GOVERNOR- I DON'T THINK THERE'S
A SMOKING GUN AT THIS POINT-
THAT BEING SAID I THINK THIS IS
A BROKEN MARKET- IT IS ONE IN
WHICH- OIL COMPANIES LIKE YOURS.
WERE ABLE TO ISSUE RECORD SHARE
BUYBACKS I BELIEVE LAST YEAR
YOUR COMPANY. AUTHORIZED TWO
POINT FIVE BILLION DOLLARS IN
SHARE BUYBACKS WHILE MY
CONSTITUENTS ARE SAYING SEVEN
EIGHT DOLLARS AT THE PUMP- AND I
DON'T I DON'T KNOW WHAT PLANET
WE CAN LIVE ON SAY. THAT THIS IS
A COMPETITIVE MARKET THAT WORKS
JUST FINE. AS FOR THE SHARE
PRICE BACK IN TWO THOUSAND
THIRTEEN I KNOW YOU GO BACK TO
TWO THOUSAND THIRTEEN FOURTEEN I
JUST LOOK THIS UP. YOUR TRADING
TWENTY SEVEN DOLLARS AND THREE
CENTS IN TWENTY THIRTEEN. TODAY
YOU ARE TRADING AT A HUNDRED
THIRTY DOLLARS AND SIXTY SEVEN
CENTS. THAT IS A MODEL THE
BROKEN A BROKEN. LIKE ECONOMIC
MODEL I THINK WE HAVE TO DO
SOMETHING ABOUT THAT I DON'T
THINK THIS IS A PROBLEM OF
ENERGY POLICY ON OUR END. I
THINK THIS IS A PROBLEM WITH A
BROKEN MARKET. WE HAVE TO FIX
IT- AND I DO THINK WE NEED
ANSWERS AND ACCOUNTABILITY HERE
BECAUSE- I DON'T KNOW WHERE THE
BLAME LIES I'VE HEARD A LOT OF
TESTIMONY TODAY. BUT THE FACT OF
THE MATTER IS THAT THAT A NUMBER
OF COMPANIES WERE MAKING
REFERENCE RECORD PROFITS. THEY
WERE DEPLOYING THOSE PROFITS TO
THEIR SHAREHOLDERS WHICH I
UNDERSTAND IS YOUR RIGHT TO DO.
BUT THEY'RE DOING THAT IT ANY
ANY VERY OLIGOPOLY WHAT MARKET A
LOOK UP A LUCK. LET ME. THANK
YOU. YOU GET MY POINT MARKET. AT
A TIME AGAIN WHEN MY
CONSTITUENTS ARE CONSTITUENTS
WERE PAYING OUTRAGEOUS FEES THAT
WERE. BANKRUPTING SOME OF THEM.
AND I THINK IT INTO YOU HE WE
CANNOT SAY THAT THAT IS A-
MARKET THAT WORKS WE DO HAVE TO
FIX IT- AND I DO THINK WE NEED
ANSWERS AT THE END OF THIS I
WANT TO. THANK THE CHAIR FOR
HOLDING THIS. I WANT TO THANK
THE GOVERNOR FOR. INTRODUCING
THIS POLICY- TO JUMPSTART A
CONVERSATION OF WHAT TO DO NEXT
BECAUSE I DO THINK WE NEED
ANSWERS WE NEED SOLUTIONS- SO
THAT. MY CONSTITUENTS THAT THE
SITUATION NEVER HAPPENS AGAIN I
I'M SURE YOU CAN UNDERSTAND THE
OPTICS. OF YOU GUYS MAKING
RECORD PROFITS AT A TIME WHEN.
PRICES AT THE PUMP RIDICULOUSLY
HIGH. THAT'S SOMETHING THAT THAT
CAN'T HAPPEN AGAIN WE GOT TO FIX
THAT. SO THAT'S REALLY NOT A
QUESTION SO MUCH AS A COMMENT- I
GUESS I WOULD OPEN IT UP IF
THERE'S ANY REACTIONS FROM ANY
THAT. THE WITNESSES THAT SENATOR
THANK YOU I BY. TO LISTENING TO.
AND AN EYE MIND TO. THE
COMPLEXITY OF THIS ISSUE- AND
THANK GOD WE HAVE FIVE COMPANIES
BECAUSE WE USED TO HAVE NINETEEN
. AND IT IS A DIFFICULT PLACE TO
DO BUSINESS. AND WE HAVE LOST.
MANY PARTICIPANTS IN THE MARKET.
BECAUSE OF THAT. AND SO THOSE
THAT REMAIN ARE HERE TO SUPPLY.
THE CALIFORNIA MARKET IN MEET
DEMAND THAT'S WHAT THEY DO EVERY
SINGLE DAY. SO THAT THIS STATE
CAN CONTINUE TO MOVE. AND THAT
IS NOT SHUT DOWN. AND IN TWENTY
THIRTY FIVE WE'RE STILL GONNA
HAVE 83% NEED FOR GASOLINE. 76%
NEED FOR DIESEL WE'VE GOT A LONG
PATH TO GO ON THAT SO. I
APPRECIATE THE ALSO- CHAIR AND
THE COMMITTEE FOR HOLDING THIS
BECAUSE- WE'VE GOT TO FIGURE IT
OUT LIKE I SAID AT THE END I
THOUGHT I STILL THINK WE'RE MORE
UNITED THAN WE ARE DIVIDED UP
TRYING TO MAKE SURE WE FIND
RELIEF AT THE PUMP WHICH IS WHAT
THIS IS ABOUT. ANNE DO EITHER
THE OTHER WITNESSES ON ON THE
PANEL HAVE ANY. THOUGHTS ON THIS
ARE TRYING TO MOVE ALONG SO IF
THEY HAVE A QUICK ANSWER PLEASE.
I JUST WANTED TO SAY. I THINK
THAT THERE IS OBVIOUSLY A
REFINING PROBLEM BUT I ALSO
THINK THERE IS A MYSTERY
SURCHARGE PROBLEM AND I THINK
THE REFINING PROBLEM IS EASIER
TO DEAL WITH. THE MYSTERY
SURCHARGE PROBLEM I FULLY
SUPPORT THE IDEA OF GOING INTO
THOSE CONTRACTS BETWEEN THE
REFINERS AND RETAILERS AND SEE
WHAT'S GOING ON I SUSPECT YOU'LL
FIND. THAT THERE IS. THERE IS
ACTUALLY A- KICKBACK OR SOME
TYPE OF- OF- CONTRACT THAT GIVES
THE REFINERS MONEY BACK FROM THE
RETAILERS BECAUSE THAT IS GOING
TO TAKE INVESTIGATION I SUPPORT
THAT DESTINATION. WHILE WE HAVE
THEM IN A YEAR WHERE THERE'S
HUGE DIFFERENCES WE REALLY NEED
TO MAKE IT MAKE IT HAPPEN. THIS
YEAR AT THE REFINING LEVEL AND
DEAL WITH THE REFINING SURCHARGE
THIS YEAR AND THE MYSTERY
SURCHARGE NEXT YEAR. THANK YOU.
IF YOU'RE GONNA TO REAL QUICK
MASEGO PLUS. IT IS REALLY
ALARMED ME. WE CAN HAVE THIS
PRICE GOUGING GOING ON WHILE.
GASOLINE DEMAND IS ACTUALLY
DECLINING AND SO I THANK YOU FOR
YOUR TIME ON THIS ISSUE IN THIS
INCREDIBLY IMPORTANT PROPOSAL I
URGE YOU TO MOVE IT FORWARD- AS
QUICKLY AS POSSIBLE BECAUSE- THE
TYPES OF PRICE GOUGING AND
PROBLEMS. AND DISRUPTION THAT
WE'RE SEEING IS GOING TO
CONTINUE. AND LAST THIS INDUSTRY
IT INVESTS AND ONCE THE
OVERSIGHT IS INCREASED. AND THE
INDUSTRY IS SUBJECTED TO THE
STRONGEST POSSIBLE REGULATION
THAT'S GOING TO PROTECT.
CALIFORNIANS THANK YOU. THANK
YOU. AND I'M GONNA THANK OUR
WITNESSES BECAUSE I KNOW WE HAVE
TO MOVE TO PUBLIC COMMENT BUT I
DO WANT TO TAKE EXCEPTION TO
WHAT WAS SAID AS WELL AS-
PAINTING THIS IS COMMUNITIES OF
COLOR- BECAUSE- THERE'S NOT A
SINGLE. OIL WELLS ARE EXTRA OUR
OUR REFINERY IN A COMMUNITY OF
COLOR WITH THE EXCEPTION OF
BALLWIN HILLS AND THAT'S A MULTI
MILLION DOLLAR HOMES. AND IT'S
BEEN KNOWN AS THE BLACK BEVERLY
HILLS FOR THE LAST FIFTY YEARS
AND IT'S BEEN GENTRIFIED EVERY
DAY. SO IT SOON WILL NOT BE AN
AFRICAN AMERICAN COMMUNITY. BUT
DISCONTINUE TO SAY THAT THIS IS
IN POOR AND MINORITY COMMUNITIES
ARTISTIC EXCEPTION IT OUT
BECAUSE ALSO GOD DOES NOT A
MINORITY COMMUNITY COURTS IS NOT
A POOR MINORITY COMMUNITY AND I
COULD GO ON AND ON AND OFF. SO
HE WENT OVER AND ALL THE AND
WE'RE GOING TO NOW MOVE ON TO MY
DISTRICT. THE ONE IN THE
DISTANCE WE'RE GOING TO MOVE ON
TO- PUBLIC COMMENT I'M GOING TO
I'M THANK EVERYBODY FOR THEIR
TESTIMONY- IN THE PRESENTERS-
DOES YOUR WOULD LIKE TO
PARTICIPATE- IN PUBLIC COMMENT
WE'RE ASKING YOU TO DIAL THE
TOLL FREE NUMBER OF. EIGHT SEVEN
SEVEN. TWO TWO SIX. EIGHT ONE
SIX THREE THAT 877-226-8163 HAN
ACCESS CODE IS. FOUR FOUR ZERO
ZERO FIVE NINE FIVE. THAT'S.
FOUR FOUR ZERO ZERO FIVE NINE
FIVE. AND NOW WILL MOVE TO THOSE
WITNESSES HERE INSIDE A ROOM
TWELVE HUNDRED WHO WISH TO
PARTICIPATE IN PUBLIC COMMENT I
WOULD ASK THAT YOU. LIMIT YOUR
COMMENTS TO ONE MINUTE PLEASE I
KNOW YOU'VE SET THROUGH A LOT
TODAY BUT WE WANNA MAKE SURE
THAT EVERYBODY. HAS THE
OPPORTUNITY TO ADDRESS THE
COMMITTEE SO YOU MAY START. THE
YEAR COMMENTS NOW AND MODERATOR
CAN YOU LET US KNOW HOW MANY
FOLKS YOU MIGHT HAVE QUEUED UP.
ON THE LINE THAT WILL WANT TO
TALK- AS WELL. THANK YOU MISTER
CHAIR- ANYONE WHO WISHES TO.
MAKE A COMMENT PLEASE PRESS ONE
TO ZERO AT THIS TIME. MISTER
CHAIRED APPEARS THAT WE HAVE AT
LEAST SEVEN OR EIGHT PEOPLE
SIGNAL BILLS WHICH THE STATE
OKAY. IT WILL START NOW WITH
OUR- WITNESSES HERE AND I'M
PERSON IN TWELVE HUNDRED PLEASE
THANK YOU TERRY MEMBERS MELISSA
ROMERO WITH CALIFORNIA BERMAN TO
VOTERS. WE ARE TODAY WE'RE HERE
TODAY LARGELY BECAUSE OF A LACK
OF ACCOUNTABILITY ON AN INDUSTRY
THAT USES THEIR UNLIMITED
DOLLARS TO LIE TO THE PUBLIC
WHILE SIMULTANEOUSLY CONVINCING
THEM THAT THEY'RE HELPING THEM.
MEANWHILE THE PAY GAP BETWEEN
OIL EXECUTIVES AND WORKERS IN
THE INDUSTRY GROWS. WE NEED
LEGISLATORS TO HAVE AT THE
FOREFRONT OF THEIR MINDS AS THEY
LEGISLATE THE FACT THAT THE OIL
INDUSTRY SPENDS THE MOST ON
LOBBYING BY FAR WISPA ALONE
SPENT ELEVEN POINT SEVEN MILLION
AND LOBBYING LAST LEGISLATIVE
SESSION. CHEVRON ALONE SPENT
EIGHT POINT SIX MILLION THIS IS
THE SAME INDUSTRY SITTING ON
UNUSED FEDERAL OIL AND GAS
LEASES WILL THEY PAY FOR ADS
ACROSS THE COUNTRY ASKING FOR
MORE. THIS IS THE SAME INDUSTRY
THAT BURIED THE SCIENCE THAT
FOSSIL FUELS ARE CAUSING CLIMATE
CHANGE THE SAME INDUSTRY THAT
HAS SHIFTED AWAY. FROM CLIMATE
DENIALISM TO DELAY TACTICS AND
GREENWASHING OF OTHER FOSSIL
FUEL BASED FEELS THAT GO BY
DIFFERENT NAMES. THE SAME
INDUSTRY THAT OPPOSES
ELECTRIFICATION. AND THE SAME
INDUSTRY THAT SPENDING MILLIONS
TO UNDO SB ELEVEN THIRTY SEVEN
SIMPLE AND HEALTH AND SAFETY
BUFFER ZONES. BETWEEN ACTIVE OIL
DRILL DRILLING AND CHILDREN'S
DAY CARES. IT IS DEADLY THAT THE
OIL INDUSTRY CONTINUES TO FIGHT
OPPOSE EVERY SINGLE POLICY
EFFORT TO MAKE PROGRESS ON
CLIMATE ACTION. BUT THE SCALES
WILL CONTINUE TO BE TIPPED IN
THEIR FAVOR. AT ALL OF OUR
EXPENSE. THE LEGISLATURE HAS A
RESPONSIBILITY TO ENSURE THAT
WE'RE NOT JUST ADDRESSING THE
COUPLE IN FRONT OF US. WHICH IS
TO ADDRESS THE EXPLOITATIVE
BEHAVIORS. THAT THE OIL INDUSTRY
HAS USED ANY UNEXPLAINABLE HIGH
GAS PRICES OVER THE LAST YEAR.
BUT THE LEGISLATURE ALSO HAS
RESPONDED ONE MINUTE I HATE TO
CUT YOU OFF AT YOUR ONE MINUTE
THANK YOU THANK YOU. IF YOUR
MEMBERS MIKE MONEY GOING TO BE
AT THE CALIFORNIA STATE BUILDING
AND- CONSTRUCTION TRADES
COUNCIL. THE BUILDING TRADES
REPRESENT FIVE HUNDRED THOUSAND
MEN AND WOMEN. IN CONSTRUCTION.
AND WE ARE OPPOSED. WE THINK
THIS LEGISLATION WILL RESULT IN
RISING GAS PRICES. WE THINK
LEGISLATION WILL. BECAUSE
REFINERIES TO SCALE BACK THEIR
OPERATIONS AND CERTAINLY WILL
COST OUR MEMBERS JOBS THANK YOU.
THANK YOU NEXT WITNESS. HELLO
SENATORS I'M MAKING SOME WAY I'M
A RETIRED NURSE. AND PUBLIC
HEALTH NURSE- I'M A FOR A
PANOPLY TO BE LEVERAGE. BECAUSE
THERE WERE THREE REFINERIES THAT
SHUT DOWN SHORTLY BEFORE LAST
SUMMER'S. SPIKE I KNOW THAT THEY
KNEW FULL WELL. IT WOULD CAUSE A
PRICE SPIKE IN THE- GASOLINE.
PRICES AND WHEN KATHLEEN PRICES
GO UP. THE PRICE OF EVERYTHING
GOES UP SO THIS IS AN EXAMPLE.
OF PLAIN AND SIMPLE CORPORATE
GREED. TAKING PROFITS. ON THE
BACKS OF CALIFORNIANS. AND IT
NEEDS TO HAVE A LIMIT ON HOW
MUCH THEY CAN DO THAT- IT'S YOU
KNOW 17100% PROFIT OVER LAST
YEAR'S PROFITS IS NOT ACCEPTABLE
. ELLIPTIC JUST AS TOO MUCH-
THERE NEEDS TO BE MORE I'M
REALLY APPALLED THAT THERE'S NO
MORE NOT MORE TRANSPARENCY I'M
HOPING YOU CAN GET SOME MORE
TRANSPARENCY INTO THIS INDUSTRY.
AND DO SOMETHING ABOUT IT I GREW
UP IN LOS ANGELES. I HAVE ASTHMA
SO THIS IS SOMETHING I KNOW
ABOUT PERSONALLY IRAN'S- IT'S-
HI ESPECIALLY. GREGIS THAT
THEY'RE TAKING PROFITS ON PEOPLE
LIKE THEY ARE. AND- IT'S HURTING
EVERYBODY BECAUSE IT IS CAUSING
INFLATION. THERE ACTUALLY
DRIVING IT. WITH THEIR EXTREME
PROFIT TAKING BECAUSE IT'S WHEN
THE PRICES GO UP IN GASOLINE
EVERYTHING GOES UP THANK YOU
TAKE YOUR NEXT WITNESS. THANK
YOU FOR YOUR TIME HI MANY MISTER
CARTER WHAT'S YOUR CODE
CALIFORNIA ON BEHALF OF OVER
FIVE HUNDRED THOUSAND MEMBERS
AND SUPPORTERS SIERRA CLUB
CALIFORNIA SUPPORTS S. B. X. ONE
DASH TWO THANK YOU THANK YOU
MCGEORGE. GOOD EVENING SHARON
MEMBERS ARE BANKAMERICA IS
REPRESENTING THE CONSUMER
PROTECTION POLICY CENTER AT THE
UNIVERSITY OF SAN DIEGO SCHOOL
OF LAW WE URGE THE LEGISLATURE
TO PASS THE PRICE GOUGING
PENALTY TO PROTECT CALIFORNIANS
FROM UNJUSTIFIED PRICE HIKES AND
STOP OIL COMPANIES FOR MARKET
RIPPING US OFF IN THE FUTURE
WHILE ENSURING A FAIR
COMPETITIVE MARKET PLACE. OIL
COMPANIES ARE SEVERELY OVER
CHARGING CALIFORNIA'S FOR
GASOLINE AND PROP POCKETING THE
PROFITS LAST YEAR CALIFORNIA
CONSUMERS PAID A 23% PRICE HIKE
AT THE PUMP WHILE SHAREHOLDERS
REAP THE REWARDS. AS YOU KNOW
HIGH COSTS AT THE PUMP
TRANSLATES TO HIGHER COSTS FOR
CALIFORNIANS TO DO EVERYTHING
EVERYDAY THINGS SUCH AS DRIVE TO
WORK GO TO SCHOOL AND TO BUY
ESSENTIAL ITEMS SUCH AS
GROCERIES. THE PRICE GOUGING
PENALTY WOULD ESTABLISH
AGGRESSIVE TRANSPARENCY MEASURES
TO HOLD OIL COMPANIES
ACCOUNTABLE AND PREVENT PRICE
HIKES FROM HAPPENING AGAIN IT
WILL ALSO ENSURE THE CDC AND THE
CD TFA. HAVE THE ABILITY TO
INVESTIGATE AND OBTAIN MORE
INFORMATION FROM OIL COMPANIES
HELPING THE STATE TO EVALUATE
COSTS AND PROFITS AND PRICING
CALIFORNIA'S GASOLINE MARKETS
THESE MEASURES WILL MAKE OIL
COMPANIES PLAY BY THE SAME RULES
THAT OTHER INDUSTRIES IN
CALIFORNIA MUST DO. AND PROTECT
CONSUMERS FROM ANTI COMPETITIVE
CONDUCT AN UNFAIR OR DECEPTIVE
ACTS OR PRACTICES IN THE
INDUSTRY THANK YOU. THANK YOU
NICK JONAS. THANK YOU CHAIR AND
MEMBERS MY NAME IS RECALL MASON
I'M HERE WITH THE CALIFORNIA
ENVIRONMENTAL JUSTICE ALLIANCE
AND SAY HI ACTION I'M HERE TODAY
TO SHARE STRONG SUPPORT FOR THIS
PROPOSAL AND STRESS THE
IMPORTANCE OF HOLDING THESE
ACCOUNT. BOIL COMPANIES
ACCOUNTABLE FOR THEIR
UNDISGUISED GREED AND AT THE
EXPENSE OF CALIFORNIA CONSUMERS
FOR DECADES THESE CONSENT THE
SAME COMPANIES HAVE POLLUTED OUR
NEIGHBORHOODS AND THREATEN THE
HEALTH. AND SAFETY OF LOW INCOME
COMMUNITIES LIKE RICHMOND- WHERE
REFINERIES BASE IT IS CLEAR THAT
THE OIL INDUSTRY'S BOTTOM LINE
IS THEIR INVESTORS AND AMASSING
UNPRECEDENTED WEALTHSIMPLE.
IMPLEMENTING A WINDFALL PROFITS
CAP WILL PUT AN END TO THESE
TACTICS AND CONTINUE TO SIGNAL
TO THIS INDUSTRY CALIFORNIANS
INTENT. TO IS A HEALTHIER AND
REGENERATIVE FUTURE THANK YOU.
THANK YOU THE QUICKNESS. THANK
YOU SENATOR BRETT BRADFORD- FOR
HAVING THIS HEARING TODAY IT'S
VERY IMPORTANT HEARING IN CENTER
TO SKINNER SKINNER FOR
INTRODUCING THE BILL AND FOR THE
COMMITTEE MEMBERS FOR LISTENING-
MY NAME'S KEITH MAMODO
REPRESENTING THE CALIFORNIA
ALLIANCE FOR RETIRED AMERICANS.
WE ARE IN STRONG SUPPORT OF S.
B. X. ONE. TWO AND THE REASON
BEING I THINK WE'VE HIDDEN UNIT
UNANIMITY OF HEARD EVERYONE
SPEAKING THAT THERE IS A PROBLEM
AND GAS PRICES. AND WE NEED TO
ADDRESS IT IT FOR ALL OF YOU.
YOU ARE NOT- SENATORS- WOULD YOU
THINK OF WHEN YOU INTRODUCE A
PIECE OF LEGISLATION. WHEN IS IT
WHAT PIECE OF LEGISLATION IS
SECURE TO CURE EVERY SINGLE
ELEMENT OF THAT ISSUE. SO THE
GOVERNOR AND SENATOR SKINNER
HAVE INTRODUCED A BILL THAT IS
GOING TO ADDRESS ONE PART OF IT.
AN IMPORTANT PART. IT'S GOING TO
REVEAL A LOT OF GOOD
INFORMATION. THAT'S GOING TO
HOPEFULLY MITIGATE SOME OF THE
GAS PRICES THAT WE HAVE SEEN.
THAT AT THE SAME TIME IT IS
AFFECTING EVERY SINGLE ONE OF
THE CALIFORNIANS. IN MOST
DISPROPORTIONATELY THOSE ARE LOW
INCOME AND ONE FOOTNOTE. THE LOW
INCOME PEOPLE HAVE A LOT LESS.
ALTERNATIVES AS YOU BERRY WELL
NO ELECTRIC VEHICLES COST
FIFTEEN THOUSAND DOLLARS MORE
THAN THAT OUR TEN FIFTEEN
THOUSAND DOLLARS. MORE THAN
AVERAGE THAT'S WHY. WHEN YOU
PASS LEGISLATION ON IT YOU
WANTED TO PROVIDE MORE
INCENTIVES. FOR LOW INCOME.
THAT'S IN THE BOOKS IN THE STATE
OF CALIFORNIA RIGHT NOW. YOU
WERE PROVIDING ADDITIONAL
INCENTIVES FOR LOW INCOME
PEOPLE. AND THAT'S A GOOD THING
SO. LET'S LET'S BE REAL. WE'RE
NOT GOING TO CURE EVERYTHING FOR
THIS PIECE OF LEGISLATION IT IS
DEFINITELY. TAKING THE RIGHT
STEP FORWARD THANK YOU VERY MUCH
THANK YOU NEXT WITNESS. WELL
CHURN MEMBERS WHEN INTERNATIONAL
BATTLE I'M REPRESENTING THE
DISTRICT COUNCIL FIND WORKERS HI
SO WE'RE RESPECTFULLY IN
OPPOSITION WE THINK THAT THE GAS
TAX DOESN'T HAVE THE SUFFICIENT
EVIDENCE- TO PROVIDE. RELIEF AT
THE PUMPS WHICH IS ULTIMATELY
THE GOAL HERE FOR ALL OF OUR
CONSTITUENTS WE ALSO THINK THAT
A DISRUPTION IN OIL GAS MARKET
IS GOING TO I'D- YOU KNOW CAUSE
LAYOFFS FOR BLUE COLLAR WORKERS
ACROSS THE STATE. THANK YOU
GUYS. THANK YOU THE QUICKNESS.
THANK YOU A GOOD AFTERNOON CHAIR
AND MEMBERS BRAVING THE
CALIFORNIA CHAMBER OF COMMERCE-
CAL CHAMBERS PARTICULAR CONCERN
ABOUT THAT PRESIDENT OF THE
WINDFALL PROFITS PENALTY WILL
SET. LARGER BUSINESS COMMUNITY
I'M THE MESSAGE IT SENDS THE
BUSINESS COMMUNITY. FIRST
GENUINE GENUINE CONCERN- THAT
THIS IT BASICALLY ESTABLISHES A
PLAYBOOK THAT THE LEGISLATURE WE
USE TO DETERMINE WHAT THE RECENT
PROGRESS REASONABLE PROFIT. TO
DO BUSINESS IN CALIFORNIA- AS WE
HEARD EARLIER TODAY TO- YOU KNOW
WE HAVE THE BENEFIT OF HISTORY
TO SUGGEST THAT- THIS APPROACH.
HAS NOT REALLY GARNERED THE
MEANINGFUL RESULTS WHEN TRYING
TO PASS STOCKLEY WHAT'S
DIFFERENT THIS TIME AROUND TO
SUGGEST THAT THERE CAN BE ANY
KIND OF DIFFERENT OUTCOME-
FURTHER THIS APPROACH WOULD
LIMIT THE VERY CAPITAL THIS
NEEDED TO TRANSITION TO CLEANER
ENERGY SOLUTIONS. THAT WE NEEDED
TO ACHIEVE OUR AMBITIOUS CLIMATE
GOALS MOVING FORWARD FOR THESE
REASONS CALCHAMBER REPRESENTING
REPORTING THOUSAND MEMBERS
RESPECTFULLY OPPOSES SIMPLE
PROFITS FAMILY. LOOKS FORWARD TO
CONTINUE DISCUSSIONS TO HELP US
ACHIEVE AFFORDABLE RELIABLE
LOWER CARBON ENERGY SOLUTIONS
NOW AND IN THE FUTURE. THANKS
THANK YOU. PETER WALKER THE
CALIFORNIA ASSOCIATION AND FOR
THAT THAT UNDER OUR ANALYSIS
CENTER PROP TWENTY SIX AND SUCH
WITH LEGISLATION WITH THE COURTS
LAID OUT. WE BELIEVE THIS WHAT
IS REFERRED TO AS A PENALTY IS
IMPACTED TAX. AND WE THINK IT
WILL FUNCTION LIKE A TAX IN THAT
COST THE WAY THE ATTACK WITH
TAXES DUE. OF CALIFORNIANS
CURRENTLY PAY THE HIGHEST GAS
TAXES IN THE COUNTRY. AND THAT
THOSE TAXES ARE GOING TO GO UP
IN JULY- AGAIN AND SO WE THINK
THAT SHOULD BE IN CONSIDERATION
AND WE DO BELIEVE THAT THIS WILL
NOT. PROVIDE RELIEF AT THE PUMP.
THANK YOU THE QUICKNESS. GOOD
EVENING CHAIR BRADFORD MEMBERS
DEAN JOLLY WITH THE CALIFORNIA
MANUFACTURERS AND TECHNOLOGY
ASSOCIATION OR C. M. DA. M. DA
WERE TO IMPROVE AND ENHANCE A
STRONG BUSINESS CLIMATE FOR
CALIFORNIA'S THIRTY THOUSAND
MANUFACTURING PROCESSING AND
TECHNOLOGY BASED COMPANIES. AS
THE ANTI RE REPRESENT NEARLY
FIVE HUNDRED COMPANIES ACROSS
THE STATE AND ONE POINT THREE
MILLION CALIFORNIANS WE- GREATLY
APPRECIATE THE OPPORTUNITY GIVE
COMMENT THE ATTENTION THIS
COMMITTEE TO GIVE THIS ISSUE.
AND THE THOUGHT THOUGHTFUL
DISCUSSION TODAY. SEEM TO JUST
FIND FROM THE CDC ON THIS ISSUE
LAST NOVEMBER THE LARGEST FACTOR
PATROLLING FUEL PRICES THE PRICE
OF CRUDE OIL WHICH IS A GLOBALLY
TRADED COMMODITY OTHER FACTORS
INCLUDING. OPERATING COSTS.
AVAILABILITY LOGISTICS PIPELINE
CAPACITY LOCAL STATE AND FEDERAL
TAXES IT IS EXTREMELY IMPORTANT
WITH THE ONGOING DEMAND FOR
ENERGY HAVE A RELIABLE SOURCE OF
GAS AND DIESEL LIMITS BY
OPTIONS. LOGIN TORIES
INVENTORIES DECLINING REFINING
CAPACITY FEW RESOURCES TO OBTAIN
. CALIFORNIA'S UNIQUE BLEND OF
FUEL. SEEM TO WORK TO
COLLABORATING WITH THE
CALIFORNIA LEGISLATURE'S ON THE
SOLUTIONS AND OUR STATE HOWEVER
THIS PROPOSAL WILL INCREASE OUR
MANUFACTURING COSTS AND MAKE OUR
SECTOR LESS COMPETITIVE. THIS
PROPOSAL HELP STALL FUTURE
DIVISION AND FINANCIAL EXPANSION
AND HAVE AN UNPREDICTABLE IMPACT
ON THE STATE'S ECONOMY THANK
YOU. THANK YOU. FOR THIS. HI MY
NAME IS THE LONGEST THAT THAT
AND I'M THE PRESIDENT OF THREE
FIFTY SACRAMENTO AND ALSO WITH
OIL AND GAS ACTION NETWORK. YOU
HEARD A LOT OF STATISTICS AND
GRAPHS AND THINGS TODAY AND I
JUST WANTED TO PULL AND
EXCERPTS. FROM CDC DATA THAT TO
ME BEST EXEMPLIFIES THE ISSUE.
THIS SHOWS FROM ONE YEAR OCTOBER
OF TWENTY TWENTY ONE OCTOBER
TWENTY TWENTY TWO. WE SEE THAT
THE PRICE OF CRUDE OIL IS ABOUT
THE SAME WE'VE SEEN THAT THE
TAXES AND FEES ARE ABOUT THE
SAME. WE SEE THAT RETAIL IS
ABOUT THE SAME COST WHAT WE SEE
IS THE DIFFERENCE. IN REFINERY
PROFITS AND COSTS. I DOUBT THAT
THERE COSTS WENT UP THAT MUCH.
BUT WHAT DID GO UP THEIR
PROFITS. THIS IS THE PROBLEM AND
THAT IS A PROBLEM THAT THIS BILL
IS GOING TO ADDRESS. WE KNOW
THAT REFINERS- MAKE 30% MORE IN
CALIFORNIA THAN THEY DO IN THE
REST OF THE COUNTRY. AND THEY DO
THIS BECAUSE THEY CAN- OR IS IT
BECAUSE TO CALIFORNIA IS TRYING
TO PUSH LEADERSHIP INTO THE
SPACE IT ARE THEY TRYING TO
PUNISH US. I THINK THAT'S THE
MYSTERY SURCHARGES THE
CALIFORNIA TAX OF JUST. TRYING
TO LEAD THE WAY. ARE THEY USE
THE SIX OF THE PROFITS NOT JUST
TO STUFF THE POCKETS OF THEIR
EXECUTIVES AND SHAREHOLDERS. AT
THE EXPENSE OF WORKING
CALIFORNIA FAMILIES BUT ALSO TO
MANIPULATE OUR ECONOMIC
POLITICAL AND DEMOCRATIC SYSTEMS
SUPERCHARGING INFLATION AND
LYING TO VOTERS IN ORDER TO
REPEAL HEALTH AND SAFETY
PROTECTION LAWS THAT THEY DON'T
LIKE. THANK YOU ALL COMMITTEE
MEMBERS I. IMPLORE YOU TO
SUPPORT THIS BILL THANK YOU. THE
QUICKNESS. HELLO MY NAME IS
THOMAS W. YATES I'M US BORN
RAISED IN SACRAMENTO. AND LIKE A
LONGER I WOULD LIKE TO SAY THAT
THERE IS A MYSTERY HAS BEEN
SOLVED. THE GREAT MYSTERY THEY
ROSE THEY WERE THE OIL INDUSTRY
RAISES THEIR PRICES. BECAUSE
THEY CAN THERE IS NOT A LOT OF
COMPETITION FOR OIL WORLDWIDE.
WE HAVE HIGH HOPES FOR EV'S AND
ALTERNATIVE POWER BUT RIGHT NOW
EVERYBODY AROUND THE WORLD. IS
DEPENDENT ON OIL THE OIL
INDUSTRY IS THE MOST POWERFUL
INTEREST ENTITY ON EARTH BECAUSE
THEY GET SOME OF EVERYONE'S
MONEY. THEY ARE RUNNING THE SHOW
THEY CAN DO WHAT THEY WANT. OKAY
. IT IS UP TO OUR DIM
DEMOCRATICALLY ELECTED
GOVERNMENT TO STAND UP TO THIS
MOST POWERFUL OF THE
INTERNATIONAL CARTELS THE OIL
INDUSTRY. THEY ARE SOLELY
FOCUSED ON GROWING THEIR PROFITS
THROUGH THE MARKET AND THE
MARKET HAS NO MORAL RUDDER. OKAY
MY AGE PUNJAB THE FRIEND WHO
OWNS A GAS STATION DOES NOT
DICTATE THE PRICE OF THE OIL.
YOUR TWO ONE MENTAL IMAGE OKAY
THANK YOU VERY MUCH- I SUPPORT
THIS BILL AND- IF ENVIRONMENTAL
REGULATIONS ARE SO ROUGH ON OIL
AT THE EARLY INDUSTRY WHY ARE
THERE ANNUAL PROFITS SO OBSCENE
. THANK YOU- IS THERE'S NO
FURTHER WITNESSES HERE IN ROOM
ONE TWELVE. I MEAN OUR TWELVE
HUNDRED I'M SORRY I'LL WILL MOVE
NOW TO THE PHONE LINES
MODERATORS CAN YOU. NOW ARE
PUMPED INDIVIDUALS WISHING TO
TESTIFY ON- AND MAKE PUBLIC
COMMENT TO BEGIN THE MODERATE
WILL NOW ASK ALL INDIVIDUALS
INTERESTED IN TESTIFYING TO
PRESS ONE THEN ZERO. A AND- THE
MODERATOR CAN YOU PLEASE GIVE ME
THE TOTAL NUMBER OF PEOPLE
WANTING TO TESTIFY. MISTER CHAIR
WE HAVE- SIT AT LEAST A TWENTY
PEOPLE WHO SIGNALED THAT THEY
WISH TO SPEAK OKAY THANK YOU
MODERATOR SO IF YOU'LL PLEASE
OPEN LINES AND NOW WE CAN START
TAKING CALLS FROM THE PUBLIC ON
THIS ISSUE. AND WILL CONTINUE
NOW START WITH. WHERE TO START
WITH LINE. ONE ZERO FOUR ONE
HUNDRED AND FOR YOUR LINE IS NOW
OPEN. THANK YOU VERY MUCH- HELLO
. AND SOON TO BRADFORD SPENDING
REVEREND JONATHAN MOSTLY FROM
LOS ANGELES REPRESENTING THE.
NATIONAL ACTION NETWORK.
OPERATING AND THE REGIONAL. I'M
HERE IN STRONG SUPPORT. HI GOD
WILLING COMMITTEE. IN ADDITIONAL
TRANSPARENCY ALBANY SECTION. NOW
ELSE BIGELOW WILL PLEASE
CALIFORNIANS AGAIN THIS SUMMER
AND FALL- A LACK OF REGULATION
ALLOWING ALL COMPLETES. THE HIKE
PRICED. SHARES CAL. SIX DOLLARS
IMPORTANT TO STUDENT PER GALLON
THIS FALL. STORED FOOD AND FIFTY
ONE CENTS MORE THAN THE NATIONAL
AVERAGE. IF WE DON'T ACT NOW. WE
KNOW BASEBALL KIDS DOING THIS
CALIFORNIANS THANK YOU VERY
MUCH. THANK YOU NEXT CALL. LINE
ONE SEVENTEEN YOUR LINE IS NOW
OPEN. HELLO MY NAME IS MICHAEL
STORED CALLING ON BEHALF OF THE
LOS ANGELES CLEANTECH INCUBATOR
OR LAZY. LATELY STRONGLY
SUPPORTS THE BILL WHICH WOULD
ESTABLISH A PRICE GOUGING
PENALTY OIL COMPANIES EXCEPT
PROFIT PROFITS- EXCESSIVE PRICE
INCREASES. DURING Q. THREE OF
TWENTY TWENTY TWO OIL COMPANY
RECORDED BILLION DOLLAR PROFITS
AT THE EXPENSE OF HARD WORK
CALIFORNIA. IF PROFITS WERE THEN
USED FOR SHAREHOLDER BUYBACKS
WHICH BENEFIT WALL STREET
INVESTORS AND EXECUTIVES
RECEIVED MULTI MILLION DOLLAR
REYES. DIDN'T COMING UPON THE
LEGISLATURE TO TAKE SWIFT ACTION
FIFTY FOUR COMPANIES ARE
UNWILLING TO PROVIDE A
TRANSPARENT EXPLANATION THE LAST
YEAR'S PRICE BY EIGHTY ISN'T
STRONG SUPPORT THIS MEASURE
THANK YOU THANK YOU NEPTUNUS.
NINE ONE TWO TWO YEAR LINE IS
NOW OPEN. THANK YOU GOOD EVENING
THIS IS FERRE CON MAYOR FOR THE
CITY OF IRVINE IN ORANGE COUNTY
I'M HERE IN STRONG SUPPORT OF
PRICE GOUGING PENALTY IN
ADDITIONAL TRANSPARENCY ON BIG
OIL. IT IS ABSOLUTELY AN
INJUSTICE TO OUR RESIDENTS AND
WORKERS OIL COMPANIES RAISE
THEIR RATES WITHOUT ANY
JUSTIFICATION FOR OVERSIGHT. IN
IRVINE WE THOUGHT SOME OF THE
HIGHEST RATES THE FACT YEAR
ALMOST REACHING EIGHT DOLLARS
PER GALLON HOUSING FINANCIAL
HARDSHIP FOR SO MANY. WE CANNOT
LET THAT HAPPEN AGAIN IT ALSO
SHAMEFUL THAT WHEN THIS
CALIFORNIA ENERGY COMMISSION
HELD A HEARING ALL FIVE OIL
REFINERS WE ACCEPT THE
INVITATION. WE NEED THE STATE'S
EXPANDED FORTY OF THIS DEBATE
AND THE CALIFORNIA DEPARTMENT OF
TAX ADMINISTRATION INVESTIGATE
BIG WILD COMPANIES AND PROVIDE
TRANSPARENCY AND ACCOUNTABILITY
WE CANNOT LIVE IN FEAR OF THE
OIL INDUSTRY'S LEADING
CALIFORNIA FOR NOT PROVIDING
ENOUGH HE'LL- BUT WE DO NEED OUR
STATE LEGISLATORS TO PROPOSE
CALIFORNIA RESIDENTS AND
WORKERS. I WOULD LIKE TO LET MY
RESIDENTS YOU KNOW IT WILL NO
LONGER BE TAKEN ADVANTAGE. OF-
THANK YOU. THANK YOU NEXT CALLER
. WHY FIFTY SEVEN YEAR LINE IS
OPEN. HELLO THE LINE. WE CAN
HEAR YOU GO RIGHT AHEAD. HI MY
NAME IS PUBLIC I AM A REGISTERED
NURSE. FORMER FROM WOODLAND
CALIFORNIA. YEAH ARE YOU SUPPORT
THIS PROPOSAL. YOU COULD NOT
REDUCE TO ME THAT THE- OKAY A
FEW. FOCUSED THANK YOU SO MUCH
MONEY THAT THEY CAN DECIDE
ELECTIONS. THEY CAN SUPPORT.
ASSEMBLY SPREAD MORE LIES. ABOUT
THE PROGRESSIVE CANADA FORGET
THE FUSES. ALSO I FEEL THAT IN
LARGE PART RESPONSIBLE. FOR THE
CLIMATE EMERGENCY. THAT WE PUT
IT ALL TOGETHER AND I CANNOT
STAND. WHY DAY AND WHAT.
LEGISLATORS IN CALIFORNIA AND
WASHINGTON. OR REALLY. BUT
IMPORTANT CHANGES. BUT I THINK
IT'S BECAUSE OF THE MONEY. THE
BAY YEAH. RADIANT WITHOUT ANY-
NEED LIMIT. SO I BELIEVE. THAT'S
A START THE ENGINE ONE POINT AN
EMERGENCY AND GOVERNMENT THAT
REPRESENTS THE PEOPLE THEY WERE
SUPPOSED WILL THEY GET ELECTED
BY. THE FIRST STEP THANK YOU
VERY IMPORTANT THANK YOU TO
ADDRESS. LINE NINETY NINE YOUR
LINE IS NOW OPEN. HI MY NAME IS
MARTIN IN MELANIA MISINFORMATION
SPEAKING ON BEHALF OF PHYSICIANS
FOR SOCIAL RESPONSIBILITY LOS
ANGELES AND SAN FRANCISCO BAY
CHAPTERS IN SUPPORT OF WINDFALL
PROFIT CAP THE OIL AND GAS
INDUSTRY PUT PEOPLE'S HEALTH AT
RISK AT EVERY STAGE FROM
DRILLING TO TRANSPORT TO
PROCESSING AND BURNING
CALIFORNIANS ALREADY PAY A HIGH
PRICE WITH THEIR HEALTH. FOSSIL
FUELS ARE ALSO BY FAR THE
GREATEST CONTRIBUTOR TO GLOBAL
WARMING THE GREATEST HEALTH
THREAT B. HAVE EVER FACED OR TO
FIND A THIRD QUARTER PROFIT WAS
30% HIGHER IN CALIFORNIA THAN
ELSEWHERE IN THE COUNTRY
AFFECTING CALIFORNIA'S ABILITY
TO SHOW UP FOR THEIR HEALTHCARE
PAY FOR THEIR FOOD AND
MEDICATION OIL COMPANIES HAVE
CAN. BE USED THEIR PROFITS FOR
MISINFORMATION I'M BLOCKING
HEALTH PROTECTIVE MEASURES SUCH
AS SB ELEVEN THIRTY SEVEN THE
OIL INDUSTRY HAS ENGINEERED OUR
DEPENDENCY ON FOSSIL FUELS AND
THAT IS KILLING US WE NEED YOU
TO PROTECT THE PUBLIC WE NEED
YOU TO PROTECT THE PUBLIC
HEALTH. THANK YOU. THANK YOU
NEXT CALL. LINES SIX FOR ONE NOW
A- HI MY NAME IS ARMY RESERVE
ALL I'M HERE REPRESENTING THE
ASIAN PACIFIC ENVIRONMENTAL
NETWORK OR A PLAN WHICH IS A
GRASSROOTS ORGANIZATION THAT
WORKS ON AGENT. THAT WORKS WITH
ASIAN IMMIGRANT AND REFUGEE
COMMUNITIES ON CLIMATE
ENVIRONMENTAL JUSTICE I. WANT TO
PUSH BACK ON THE COMMENTS THAT
REFINERIES ARE NOT IMPACTED
IMPACTING POOR COMMUNITIES OF
COLOR WE ARE ORGANIZING IN
RICHMOND AND WILMINGTON WHERE
CHEVRON VALERO AND PHILLIPS
SIXTY SIX ARE REFINING AND
EITHER ABSOLUTELY POOR
COMMUNITIES OF COLOR THAT ARE
SEEING THE DAILY IMPACT ON THE
FENCE LINE. OF THESE FACILITIES
WHAT THEIR CHRONIC AIR POLLUTION
OIL SPILLS WEARING AN EXPLOSION
WE EXPRESS OUR SUPPORT FOR THE
PENALTY AT THE KEY PIECE. TOWARD
OIL INDUSTRY ACCOUNTABILITY AND
IMMEDIATE TERM RESPONSE. AND AT
THE SAME TIME BEEF. PRICES LAKES
ARE A PRODUCT OF UNCOORDINATED
SUPPLY AND DEMAND SO WE WOULD
LIKE TO SEE WHAT COMPELLED BY
THE BILL'S INCLUSION OF AN INTER
AGENCY PROCESS. TO PLAN FOR THE
STATE TRANSITION AWAY FROM OIL
AND WE HOPE THAT WORKERS AND
COMMUNITIES LOCAL IMPACTED BY
THE OIL INDUSTRY ARE AT THE
CABLE FOR THE PLANNING PROCESS.
BECAUSE WE NEED THE STATE TO
PLAY A ROLE IN ACHIEVING A PLAN
COORDINATED IN MANAGED PETROLEUM
PHASE OUT AND A FUTURE BEYOND
OIL FOR CALIFORNIANS. THANK YOU
THE NEXT CALLER. LINES EIGHT
YOUR IS SO. GOOD EVENING
CHAIRMAN BOB BRADFORD THANK YOU
FOR THE STOP COMPLAINING OF
MEETINGS AND I'D LIKE TO BELIEVE
THAT- THAT WORK CLOSER TOGETHER
THAN APART. AND I WANT MY- I AM
PLEASED TO THE JEOPARDY- I DON'T
ASK LEGITIMATE BOILERMAKERS.
REPRESENTABLE AMERICAN JOURNAL
CALIFORNIA RIGHT. AND I DO HAVE
BEEN SAID THAT. ISSUE WITH
SUPPLY- WE DON'T FIFTY FIFTY
ADDITIONAL PARMI DRESSED HIS
REPLY DOWN DOWNSTREAM WITH IT
WHATEVER THAT MAY BE THAT IT'S
PART OF SPOKE. SPOKE TO IT BEING
DOWNSTREAM. DOWNSTREAM ISSUE AT
THE BEGINNING OF THE MEETING
THE- IT WAS THE FIRST ACTION WAS
NO ON TO THE CONSUMER. AND I'M
NOT SURE THAT YOU KNOW PRESENT
FOR THIS- YOU GOT TO GO BACK AND
SPEAK TO SOME OF THE- THIS
MORNING YEAH YOU DON'T MAKING
EARLIER YEAH DEFINITELY WHAT THE
LINE AT THE OF RIGHT NOW THIS IS
NOT. NOT YET SO I DO HAVE TO GO
BACK IN AND- BE LOOKED AT AGAIN
I WOULD THINK THAT THE REGRETFUL
BECAUSE WHEN YOU MADE YOUR
COMMENTS REGARDING. THE COLOR
WHEN I GET OUT WE BECOME FRIENDS
BECAUSE- THE GROUP THAT MY
COMMUNITY IS WELL TOO SO THANK.
YOU FOR MAKING A COMMENT- SO I
THINK I MIGHT ORIGINALLY I HAD A
- THINKING THAT IF. WE LOOK AT
YOUR A TRUE MINUTE MAKE IT. ON
THE MIKE HI. WHAT WITH THE RIVER
HAVE BEEN CHARGED RESPOND DOES
TWENTY ONE AND TWENTY TWO BY
THREE BY ONE AS THE CORE BUT YOU
FOR THE PART TIME THANK YOU.
STENOSING VICE HERE THERE AND
YOUR QUESTION I DIDN'T QUITE IN
. OUR NEXT CALLER PUSH. LINE ONE
TWENTY- HELLO THIS IS THE
EMERGENCY BEACON ON BEHALF OF
THE- STEVE WE BELIEVE WE NEED A
PROTECTING PENALTY TO DISCOURAGE
DETRIMENTAL PRICE HIKE FROM
HAPPENING IN THE FUTURE AND TO
PROVIDE MUCH NEEDED OVERSIGHT
AND TRANSPARENCY. PARENTS NEED
TO HOLD THE OIL AND GAS INDUSTRY
ACCOUNTABLE. MOMENT BIG OIL USES
THE PROFIT FROM POLLUTING OUR
COMMUNITY TO ENSURE THEY CAN
CONTINUE DOING SO LAST YEAR OIL
COMPANIES SPEND MILLIONS TO
CRASH AT THE ONE ONE THREE SEVEN
UP PUBLIC HEALTH THOUGHT. IT
WOULD AND DIRTY OIL DRILLING IN
OPERATIONS IN NEIGHBORHOODS
SHOULD BE PAID FOR AN ARMY OF
PETITIONERS TO STAND OUTSIDE
GROCERY STORES AND GAS STATIONS
ACROSS THE STATE. MANY THE STATE
DIVISION THE MAJOR GATHERED.
SPREAD LIES ABOUT THE PUBLIC
HEALTH LAW. THE PETITIONER HELP
THAT SETBACKS WILL SEND GAS
PRICES SOARING BUT WE KNOW THAT
OVERTURNING THE VITAL HEALTH
PROTECTION WON'T BRING DOWN GAS
PRICES- PRICE GOUGING PENALTY
HOWEVER WELL. THE THOUGHT OF YOU
INDUSTRY HAVE A HISTORY OF
PROTECTING THEIR BOTTOM LINE FOR
ANY MEANS NECESSARY USING THEIR
DIRTY MONEY TO UNDERMINE
DEMOCRACY AND MISINFORM THE
PUBLIC TO CONTINUE RAKING IN
PROFITS- THE PRETENDING. HE
WOULD TAKE STEPS TO UPHOLD TO
HOLD THEM ACCOUNTABLE FOR THAT.
IN FACT JUST THE THREAT OF THE
LAW HAD COINCIDED WITH THE OIL
COMPANIES BRINGING PRICES. AGAIN
IN THE FUTURE. WE STRONGLY URGE
THE CALIFORNIA LEGISLATURE TO
STAND ON THE SIDE OF THE PEOPLE
AND STOP. BIG OIL GREEDY PRICE
GOUGING. THANK YOU NEXT CALLER.
LINE. ONE EIGHTEEN. NINE ONE
EIGHTEEN YOUR LINE IS OPEN.
WE'RE GONNA LOOP MOVE ON TO LINE
ONE TWENTY ONE. THANK YOU. THE
CALL HELLO. HELLO MY NAME IS
JESSICA YES I AM A COMMUNITY
ORGANIZER WITH THE CENTRAL
CALIFORNIA ENVIRONMENTAL JUSTICE
NETWORK- I KNOW WHAT IT'S LIKE
TO LIVE IN THE SHADOW OF THE OIL
AND GAS COMPANIES. YESTERDAY I
REPORTED A REFINERY IN THE MARCH
FIRST BETWEEN BLACK SMOKE THAT
REFINERY HAS A MONITORING SYSTEM
THAT'S SUPPOSED TO BE LIVE YET
THERE WAS PLANNED MAINTENANCE
WINDOWS BLACK SMOKE WAS SPEWING
FROM THE REFINERY. I KNOW THAT
REFINERIES CANNOT BE TRUSTED TO
PROTECT COMMUNITY MEMBERS AND
THEY CANNOT BE TRUSTED TO
PROTECT OUR ECONOMY THEY WILL
WORK- AT ANY AND TO MAKE SURE
THAT PROFIT IS THEIR BOTTOM LINE
AND THE CALIFORNIA ECONOMY
CANNOT DEPEND ON- SOMEONE WHO-
YOU KNOW- INDUSTRY THAT LIVES ON
CORPORATE WELFARE AND ALSO
CAUSING A BIG DISCREPANCY
BETWEEN. THE PRICE OF GAS AT A
NATIONAL LEVEL AND HERE IN
CALIFORNIA- FINERY NEED TO BE
HELD ACCOUNTABLE AND WE CANNOT
TRUST THEM TO DO SO THEMSELVES
SO I SUPPORT A PRICE GOUGING
PENALTY TO MAKE SURE THAT
CALIFORNIANS ARE PROTECTED
BEFORE SIGNERS THANK YOU. THANK
YOU NEXT CALLER. WINE ONE
FOURTEEN YOUR LINE IS NOW OPEN.
RECORD GRADING ASSISTANT WALL
COMING UP OPPOSED BY FUELS BOTH
PARTIES ONE LARGE WORDS LARGEST
PRODUCERS OF BIOFUEL GLOBAL
LEADER IN SUSTAINABLE
BIOPRODUCTS. WE ALSO SHARE YOU
KNOW THE CONCERNED ABOUT HIGH
FUEL PRICES IN CALIFORNIA. WE
DON'T WANT THAT I REJECTED
PLEASE CONSIDER MEASURES IN
ADDITION TO THE ONE PAUL- OF
THE- TO REDUCE ABOUT GASOLINE
PRICES AT THE IN CALIFORNIA AS
WELL AS LOWER GREENHOUSE GAS
EMISSIONS AND KEPT. CONTROLLING
CONSUMPTION BY INCREASING THE
AVAILABILITY AND USE OF
SUSTAINABLE BIOFUEL BLENDS. ONE
THING THAT YOU NEED ABOUT
CALIFORNIA'S AT THE CALIFORNIA
MONTANA ARE THE ONLY STATES THAT
DO NOT ALLOW FOR THE USE OF E.
FIFTEEN ABOUT FUELS CURRENTLY AT
TEN IS USED TO CALIFORNIA- WHICH
IS WHICH IS 10% ETHANOL EITHER
TEAM V. 15% BIOETHANOL- IT WAS
DOCUMENTED. BUT WITH THAT WITH
THE USE OF THE FIFTEEN WE CAN
REDUCE YOU KNOW THERE'S PRICES
AT THE PUMP FUEL- STUDIES HAVE
SHOWN- BUT FROM LAST YEAR. THAT
THE DIFFERENCE BETWEEN THE TEN
OF THE FIFTEEN WITH SIXTEEN
CENTS PER GALLON LESS- THE
DIFFERENTIAL- ON THAT AS WELL AS
WOULDN'T GAS PRICES INCREASE
THAT DIFFERENTIAL ALSO
INCREASES. THE TIME SAVINGS BY
USING EVICTING GROWS AS A
PATROLLING PRICES INCREASE. IF
IT IS ALSO MORE PART YOUR TO ONE
MINUTE TO. OKAY THANK YOU OKAY
YOU WE'RE WITH YOU FOR ALL RIGHT
WILL WORK NINE ONE NINE. YOUR
LINE IS OPEN. GOOD EVENING CHAIR
AND COMMITTEE MEMBERS I'M CONTRA
COSTA COUNTY SUPERVISOR JOHN
GIOIA FROM RICHMOND AND SERVE ON
THE BAY AREA AIR QUALITY
MANAGEMENT DISTRICT BOARD AND
PRIVILEGE PREVIOUSLY SERVED ON
THE AIR RESOURCES BOARD. I
STRONGLY SUPPORT THE GOVERNOR
AND SENATOR SKINNER'S PRICE
GOUGING PANEL THE BILL. MY
SUPPORT IS BASED ON TWENTY FOUR
YEARS OF EXPERIENCE AS A
SUPERVISOR REPRESENTING E. J.
COMMUNITIES AND CONTRA COSTA
COUNTY. HIS COMMUNITIES I
REPRESENT HAVE BEEN IMPACTED BY
REFINERY POLLUTION. AND HAD BEEN
HEAVILY BURDENED WITH THE
INCREASING COST OF GASOLINE. I
REGULARLY HEAR THEIR FRUSTRATION
ABOUT HOW MUCH MORE THEY PAY IN
FUEL COSTS DESPITE RECORD OIL
COMPANY PROFITS. IT IS NOT FAIR
OR EQUITABLE. THE GOVERNOR'S
PROPOSAL WILL PROVIDE RELIEF TO
THOSE COMMUNITIES WHICH HAVE
PAID THE COST OF LIVING NEAR THE
FACILITIES THAT REFINED GASOLINE
FOR DRIVERS THROUGHOUT OUR STATE
. I SCOUTING PENALTY BILL IS
LONG OVERDUE FOR FRONT LINE
IMPACTED COMMUNITIES. THANK YOU
AND THANKS TO SENATOR SKINNER.
LINE ONE THANK YOU YOUR LINE IS
NOW OPEN. THANK YOU. HELLO I AM
DOCTOR RANDY VIEGAS FROM MY
SAILOR CALIFORNIA I AM A
PROFESSOR AN ELECTED TRUSTEE FOR
THE MY CELL UNIFIED SCHOOL
DISTRICT AND A RESIDENT OF THE
CENTRAL VALLEY. I'M HERE IN
STRONG SUPPORT OF THIS PRICE
GOUGING PENALTY AND INCREASED
TRANSPARENCY ON THE OIL
INDUSTRY. HERE IN THE CENTRAL
VALLEY WE HAVE SOME OF THE WORST
AIR QUALITY AND HEALTH OUTCOMES
IN THE NATION. OUR RESIDENTS
HAVE SOME THE HIGHEST POVERTY
RATES IN THE STATE HIGHER GAS
PRICES DISPROPORTIONATELY HARM
THOSE LOW INCOME COMMUNITIES AND
COMMUNITIES OF COLOR AND YES FOR
THOSE FEW SENATORS AND DENIAL
THOSE COMMUNITIES EXIST IN YOUR
DISTRICT AND ALL ACROSS THE
STATE. WE CAN NO LONGER ALLOW
BILLION PROFITEERING WHICH
EXPLOITS SOMEHOW SUPPORT
POPULATION THE CALIFORNIA.
INSTEAD OF KEEPING PRICES FAIR
FOR CONSUMERS BIGELOW IS KEPT
THEIR PRICES HIGH SO THEY CAN
RAKE IN THESE RECORD PROFITS AND
ALL THAT MONEY AND BILLION TO GO
TOWARDS INVESTORS STOP BONUSES
AND SHAREHOLDERS. WE NEED TO
REIN IN BIG OIL IN PROTECT
WORKING CLASS FAMILIES. BUT MANY
MEMBERS I URGE YOU TO SUPPORT
THIS BILL AND THE PEOPLE ABOUT
PROFIT I URGE YOU TO PUT
FAMILIES BEFORE REFINERIES. AND
ASK YOU TO PRIORITIZE ALL
CALIFORNIANS INSTEAD OF THE
COMPLICITOUS OF THE OIL.
INDUSTRY THANK YOU NEXT CALL. BY
ONE THIRTY YEAR LINE NOW A-
BEGINNING CARING COMMITTEE
MEMBERS MY NAME IS DAVID FRANK
AND I'M WITH THE LOS ANGELES
BUSINESS COUNCIL AND WE STRONGLY
SUPPORT S. B. X. TWO. THE LOS
ANGELES BUSINESS COUNCIL THE
BUSINESS ADVOCACY AND RESEARCH
ORGANIZATION REPRESENTING OVER
FIVE HUNDRED MEMBERS ACROSS
CALIFORNIA. THE PRICE OF
GASOLINE REACHED RECORD HIGHS
WHILE THE OIL INDUSTRY
SIMULTANEOUSLY RE CORPORATE
PROFITS THE COST OF CONDUCTING
BUSINESS FOR BUSINESSES OF ALL
SIZES WITHIN THE STATE HAS
BECOME BURDEN. BURDENSOME INMATE
AND MAKE CALIFORNIA LESS
COMPETITIVE. S. B. X. TWO WOULD
BRING MUCH NEEDED TRANSPARENCY
NECESSARY TO ANALYZE COSTS
PROFITS AND PRICING. IN THE
REFINING DISTRIBUTION AND RETAIL
SEGMENTS OF THE CALIFORNIA
GASOLINE MARKET. WE SUPPORT S.
B. X. TWO WHICH WE HOPE WILL PUT
AN END TO HARMFUL MARKET PRICING
PRACTICES. THE BURDEN OF HIGH
GAS PRICES BORN BY ALL
CALIFORNIANS IN CALIFORNIA
BUSINESSES CURRENCIES ME SB X.
TWO WILL ESTABLISH INSTITUTIONAL
PROTECTIONS. THAT PROTECT ALL OF
US AGAINST UNFAIRLY HIGH GAS
PRICES. FOR THIS REASON THE LOS
ANGELES BUSINESS COUNCIL IS
PLEASED TO SUPPORT S. B. X. TWO.
THANK YOU FOR YOUR TIME. LINE
FORTY SIX YOUR LINE IS NOW OPEN
. HI THERE MY NAME IS RISKY AS
HELL I AM REPRESENTING THE
CENTER ON READ POVERTY MEANS
IRONMAN. THE ENVIRONMENTAL
JUSTICE ORGANIZATION BASED IN
KERN COUNTY CALIFORNIA. OIL
COMPANIES ARE RIPPING OFF
CALIFORNIANS. PRICE GOUGING
PENALTY OR WINDFALL PROFITS CAP
IS SORELY NEEDED TO PROTECT
CALIFORNIANS FROM GREEDY
POLLUTERS. CALIFORNIA ALREADY
IMPOSES A CAP ON PROFIT FOR
OTHER AND ENERGY COMMODITIES
LIKE ELECTRICITY AND NATURAL
GAS. WE CAN AND SHOULD DO THIS
FOR GASOLINE PRICES TO PROTECT
CONSUMERS WHILE ENSURING
RELIABLE SUPPLY. GOVERNOR NATHAN
THE CALIFORNIA LEGISLATURE MUST
FOR BIG OIL ACCOUNTABLE AND PASS
A PRICE GOUGING PENALTY. THANK
YOU NEXT CALLER. LINE ONE TWENTY
THREE. SHE HI MY NAME IS MARIA
MONTEZ I'M ACTUALLY CALLING FROM
THE COUNTY OF SAMBAR DINO WHICH
SURPRISED YOU HAVEN'T HEARD
ANYBODY- I'M COLIN I DO SUPPORT
IT IS PRICE GOUGING BILL-
HOWEVER WE DO NEED TO FIND OUT
WHAT IS THAT MYSTERY- TAXES THAT
WE'RE BEING TAXED ON. SO MANY
THINGS ABOUT HER SO MANY-
COMMENT BACK BEFORE THE COURTS
WE HEAR ABOUT ALL THE DOLLARS
THAT BE OUR PRIMARY STATE
HOWEVER. THERE ARE ALSO PUSHING
. FOR ELECTRIC CARS AND WHAT
NOT. IT SENATORS ID STAND DO YOU
KNOW HOW MUCH THE CAR ELECT CARS
BECAUSE CAN WE AFFORD THEM DO
THEY KNOW THAT THERE IS A DEVICE
THAT HAVE TO SOMEHOW HOW MUCH OF
COST. IS GONNA GO BUT YOU SOUL
THAT IN THE REGARDING THE GUY
TAX IS IN OUR- I HAVE PERSONALLY
IN MY BOB WHAT I HAVE TO DO MY
WITH FAMILY FOUR. SO I URGE YOU
SENATORS TO PLEASE DO WHAT WE
VOTED YOU IN THERE FOR TO HELP
US CALIFORNIANS WE HAVE TO HELP
SAN DIEGO THEY WANTED TAX ON THE
MILEAGE FOR BILL TO TRY FOR YOUR
HOPE IT DOESN'T COME HERE BUT WE
URGE YOU SENATORS TO DO THE
RIGHT THING HELP US
CALIFORNIANS. WE NEED TO BE MORE
INFORMED ALL CALIFORNIANS OF ALL
THIS. HOW DO NOT HAPPENING THE
FIFTY FOURTH. TO ACT. SO PLEASE
. FIND UP TO YOUR IS NOW OPEN.
HELLO- THE IS MAYOR HERNANDEZ
WITH THE CITY OF COACHELLA- AND
- COUNTY. I'M CALLING IN SUPPORT
OF THE GOVERNOR'S- BUT A PRICE
GOUGING AND MEASURE. I JUST TO
REMIND EVERYBODY OF THE
DEFINITION OF PRICE GOUGING THAT
THE ACTION OR PRACTICE. OF
OVERCHARGING CONSUMERS FOR
SOMETHING. BY SHARPLY INCREASING
ITS PRICE ESPECIALLY IN ORDER.
TO TAKE ADVANTAGE OF THE SITE IN
HIGH DEMAND. AND IF YOU LOOK AT
THE LAST FEW YEARS THAT'S
EXACTLY WHAT'S- BEEN OCCURRING
IN. THE REAL WORLD IMPACTS ON
OUR CONSTITUENTS THAT WE SEE ON
THE STREETS IS. PRETTY PROFOUND
IT. CONSTITUENTS WHO CAN'T
AFFORD. NO GAP AT ALL BECAUSE
THEY NEED TO PAY FOR
PRESCRIPTION DRUGS. THIS
INSURANCE WHO CAN'T AFFORD NO
GAP AT ALL BECAUSE- THEY NEED TO
BUY FOOD- WHEN YOU TAKE IT ALL
IN THE TOTALITY THE INFLATION
THAT WE'RE SEEING. THE PRICES ON
DEALING CREASES IN GAP ON
HOUSING. ON NATURAL GAS AS WELL.
AS THE IMPACT ON THE COMMON FOLK
IS VERY SEVERE ON THE STREETS
HERE IN RIVERSIDE COUNTY AND
ESPECIALLY OUR RURAL
AGRICULTURAL COMMUNITY AND
THAT'S WHY WE'RE IN FOR THIS
MEASURE. THANK YOU. NINE DOLLARS
GOOD LUCK THANK YOU. BLY ONE. HI
I'M BILL ALLEY- DIRECTOR OF
GOVERNMENT AFFAIRS FOR THE
ENVIRONMENTAL WORKING GROUP BY
WITH THE IMPRESSIVE FOR MOST OF
THE HEARING TODAY AND HAD TO
LEAVE. IMPRESSED BY A LOT OF THE
TESTIMONY AND GREAT QUESTIONS
FROM THE SENATORS- IT'S
INTERESTING THAT THE INDUSTRY
FALL BACK UPON THIS SYSTEM
CLIENT DEMANDS EXPLAIN THIS HUGE
GAP THAT THEY WERE UNWILLING TO.
FIT BEFORE THE HEARING LAST FALL
AND ANSWER QUESTIONS THE SALE WE
I CAN'T REVEAL PROPRIETARY
INFORMATION YOU KNOW THAT WAS
THE REASON. THEY WERE IN THE HOT
SEAT AND NOW THEY ARE FINALLY
COMING FORWARD JUST TO OPPOSE
THE BILL. AND SOME WOULD SAY
DAYS SPENT A LOT OF MONEY TO GET
SB ELEVEN THIRTY SEVEN PASSED
AND MAYBE THEY ARE HELPING TO
PAY FOR THAT EFFORT BY JACKING
UP PRICES. APPOINTMENTS THERE'S
NO EXPLANATION FOR THE GAP. THE
ENERGY COMMISSION STAFF HAS
SHOWN THAT ABSOLUTELY.
EXCLUSIVELY CAN THEY WON'T
ANSWER THE REASON WHY INTERFAITH
REPLIED DEMAND WHEN WORLDWIDE
SUPPLY DEMAND IT IS. BECAUSE THE
THREE YEAR FLUCTUATIONS IN THEIR
REVENUE AND PROFIT THAT- THE
HEAD OF WITH THE SAD WHEN THE
CRUDE CRUDE PRICES ARE
SUPPRESSED BY OPEC AND WE'RE
GOING TO REDUCE. THE- PRODUCTION
IT AFFECT. PRICES IN. THE UNITED
STATES THE PRICE OF CRUDE.
ACCESSING HEALTH. THANK YOU YOU
WE HOPE THAT THE- TOP LET'S GET
IT DONE THANK NEXT. LINE SEVENTY
FOUR. HI MY NAME'S BRIAN CALL
FROM C. INDIA I'M WITH THREE
FIFTY AN OPPORTUNITY INDUSTRY
FOR FIFTEEN YEARS I STRONGLY
SUPPORT THIS PRICE GOUGING BILL.
AND I WANT TO EMPHASIZE TO THE
CENTERS HOW ANGRY PEOPLE ARE
VERY ANGRY AND WE'RE NOT GOING
TO SUPPORT WE'RE NOT GOING TO BE
OKAY WITH NOTHING HAPPENING-
IT'S VERY GALLING TO BE LECTURED
BY THE OIL INDUSTRY. TALKING
ABOUT THEIR OTHER PRODUCTS ARE
GOING UP THEY ARE INTENDED TO BE
LECTURED BY PEOPLE WHO WORK FOR
THE SAUDI ARABIAN GOVERNMENT
ABOUT HOW GOVERNMENT CAN'T PLAY
ANY ROLE HERE. THIS IS VERY
IMPORTANT FOR HOLDING UP OIL OIL
ACCOUNTABLE THANK YOU. THANK YOU
NEXT WITNESS NEXT CALLER. NINE
ONE THIRTY SIX. GOOD AFTERNOON
OR GOOD EVENING. MY NAME IS IGOR
TRIANGLE. AND I FIVE IS CHAIR OF
THE ALAMEDA COUNTY DEMOCRATIC
PARTY. I'M ALSO A UKRAINE NATO'S
. TWEET INDOORS TO UNANIMOUSLY.
THIS I ITEM S. B. X. TILL WE
FINALLY PRE SCHEDULED
MAINTENANCE IS NOT A CREDIBLE
EXPLANATION FOR THE SUDDEN.
DOPPLER FIFTY FOUR ASSEMBLY
INCREASE IN WHAT WE FIND AT
LEAST CHARGE FOR EVERY GALLON OF
GAS CALIFORNIANS BY PUTTING A
MARK THE NORMS OF THE OIL
COMPANIES USING THE BAR IN MY
HOMELAND TO MAKE EXORBITANT
PROFITS IT'S INHUMANE. BOB YOU
CRANE WOULD NOT BE SUFFERING IF
YOU HAVE WASN'T DEPENDENT ON
QUESTION GAPS THE PEOPLE OF
CALIFORNIA WOULDN'T BE DECIDING
WHAT SUPPLIES NOT TO BUY IT
BECAUSE THEY HAVE TO FILL UP
YOUR GAS TANK TO GET TO WORK.
FOR SECURITY IN THE WORLD WE
NEED ENERGY INDEPENDENCE FROM
FOSSIL FUELS FIRST WE NEED TO
ENSURE A WIN PAPA PAPA CAP AND
WE BATES FOR CONSUMER TO COMPLY.
THE LEGISLATURE MUST SEE THIS AS
A NATIONAL SECURITY ISSUE AND
GET IT DONE. HEY WE HAVE TO
LISTEN IN SUPPORT OF THIS ALSO
PASSED WITH UNANIMOUS LEAVE AT
THE LAST CALIFORNIA DEMOCRATIC
PARTY MEETING THANK YOU GOVERNOR
NEWSOM. AND THANK YOU TO OUR
HOMES SENATOR NANCY SKINNER AND
ALL OF YOU FOR YOUR LEADERSHIP
LET'S WORK TOGETHER AND GET. THE
STUFF THANK YOU NEXT CALLER. BY
. ONE THIRTY EIGHT. BY THAT I
MEAN ALL WAY BACK INTO COACHELLA
VALLEY I'M JUST CALLING INTO. OR
OR AT THE ACT THAT ONE WELL AND
THE THING SENATORS DINNER FOR
PUTTING THAT PROPOSAL FORWARD.
I'M HERE AND I CAN TELL ABOUT
OUR COMMUNITY IS PARTICULARLY
SUSCEPTIBLE TO- THAT THAT
POSSIBILITY THAT ARE NOT
PARTICULARLY ALSO WITH- STOCKLEY
PARK IS GOING UP AND BEING ABLE
TO- AND GO ABOUT THEIR DAILY
LIVES AND ALSO PARTICIPATE IN
CIVIC ENGAGEMENT- AND GET BEAT
PARTICULAR ADVOCATE ESPECIALLY
IN THE AREA WHERE. A LOT OF THEM
ARE CONCERNED ABOUT WHAT'S GOING
ON THAT WAY- OTHER ENVIRONMENTAL
ISSUES SUCH AS THE BOND THEME-
SO WE ARE STRONGLY- IN. SUPPORT
OF AB. ONE TWELVE AND WE THINK
YOU. OPPORTUNE TO COMMENT. THANK
YOU THE CALLER. LINE ONE THIRD.
NINE GOOD EVENING THANK YOU
CHAIR BRADFORD A MEMBER OF THE
COMMITTEE I'M KERRY ONLY WITH
ECONOMIC SECURITY PROJECT ACTION
CALLING IN SUPPORT OF THIS
MEASURE. OIL AND GAS COMPANIES
CHARGE HIGH PRICES FOR ONE
SIMPLE REASON BECAUSE THEY CAN
WE'VE HEARD THAT TIME AND TIME
AGAIN. THE POWER IS CONCENTRATED
AND THEIR PRICING IS COMPLETELY
OPAQUE WELL COMPANIES MADE EVERY
EXCUSE TODAY FOR THE
SKYROCKETING PRICES BUT THE
TRUTH IS A BIG OIL MADE HISTORY
LAST YEAR AS THEY RAKED IN A
RECORD BREAKING PROFITS. FOR
PAYING- FACING EXORBITANT PRICES
AT THE PUMP WELL THEY MAKE MORE
PROFIT FROM CALIFORNIA THAN
ANYWHERE ELSE IN THE WORLD
FRANKLY WE'RE BEING PLAYED AS
FOOLS. THEY OBVIOUSLY DON'T NEED
TO CHARGE THESE HIGH PRICES BUT
THEY'RE DOING SO ANYWAY. WILL
CALL THEIR- REQUIRING OIL TO
JUSTIFY WHAT THEY CHARGE AND WHY
AND IF THEY CAN'T JUSTIFY IT
THEY PAY THE PENALTY IT'S A
SUPER SIMPLE MEASURE IS VERY
STRAIGHTFORWARD AND IT MAKE SURE
THAT BIG OIL IS A WHINY POCKETS
WITH OUR HARD EARNED MONEY.
PEAPOD W. SOME FOR CALLING BIG
OIL'S BLASTS AND DEMANDING
ACCOUNTABILITY ON BEHALF OF
CALIFORNIANS. THANKS TO SENATOR
SKINNER FOR BRINGING THIS
IMPORTANT PIECE OF LEGISLATION
ALREADY AND WE URGE THE
COMMITTEE AND THE ENTIRE
LEGISLATURE TO SUPPORT THIS.
THANK YOU FOR YOUR TIME THANK
YOU. NEXT CALL. AND OUR FINAL
COLOR MADE OR MAY NOT BE AWARE
OF THEIR NUMBER HOWEVER THEY
JUST QUEUED UP AT THE VERY LAST
MINUTE. PLEASE RESPOND AT THIS
TIME. THE CAPTAIN DODD CALLING
FROM SANTA ROSA CALIFORNIA ON
ASSOCIATE MYSELF WITH THE
REMARKS OF THE PREVIOUS PERSON.
THIS IS ABOUT OIL COMPANY GREED
AND IT THANKS SENATOR SKINNER
FOR HAVING- THE COURAGE TO STAND
UP TO BIG OIL AND GOVERNOR'S
SOON AS WELL AND HOPEFULLY THE
REST OF THE COMMITTEE MEMBERS
WILL FOLLOW SUIT THANK YOU.
THANK YOU MODERATORS OUR LAST
CALLER. YES RICHARD WE ARE
CONCLUDED WITH THE COMMENTS OKAY
WELL MEMBERS WE'VE HEARD FROM
ALL OF OUR CALLERS WITH. BOTH
AND IT WITNESSES INSIDE THE-
MMHM ONE. PUT ME TWELVE HUNDRED
ARE THERE ANY QUESTIONS OR
CONCERNS THAT MEMBERS HAVE AT
THIS TIME. IS GOING TO SAY THANK
YOU CHAIRMAN HUNG IN THERE FOR A
LONG TIME. TO CALL THOSE
COMMENTS AND THREE PANELS COULD
JOB. THANK YOU AND I THINK ALL
OF MY COLLEAGUES TO PARTICIPATE
IN THIS HEARING TODAY. AND THE
TWO THAT ARE STILL HERE WITH ME
I REALLY APPRECIATE THAT AND I
WANT TO THANK ALL THE
INDIVIDUALS WHO CALLED. IN TO
PARTICIPATE IN THE PUBLIC
TESTIMONY TODAY IF YOU WERE NOT
ABLE. TO TESTIFY VIA
TELECONFERENCE OR RESULTS PLEASE
SUBMIT YOUR COMMENTS OR
SUGGESTIONS IN WRITING TO THE
SENATE COMMITTEE ON ENERGY
UTILITIES AND COMMUNICATIONS OR
VISIT OUR WEBSITE. YOUR COMMENTS
AND SUGGESTIONS ARE IMPORTANT TO
US AND WE WANT TO INCLUDE YOUR
TESTIMONY IN THE OFFICIAL
HEARING RECORD. THANK YOU AND WE
APPRECIATE YOUR PARTICIPATION WE
HEARD SOME VALUABLE TESTIMONY
TODAY TO HELP GUIDE OUR EFFORTS
GOING FORWARD. IN FOR
CONSIDERATION AS AFFECTING
GASOLINE PRICES I WOULD ONLY
TAKE ONE EXCEPTION TO CONTINUE
TO COMPLETE THE ENVIRONMENT WITH
THE PRICE OF GASOLINE AND
THEY'RE- NOT ONE IN THE SAME
THEY'RE TWO DIFFERENT DISCUSSION
SO. WE ARE ALL HERE COMMITTED TO
IMPROVING OUR ENVIRONMENT BURGER
ALSO WHAT THE PRICE OF GASOLINE
IS SO THAT'S THE ONLY. ISSUE I
WOULD MAKE THIS IS ABOUT PRICING
AND NOT TO ENVIRONMENT. BUT ALSO
I WANT TO KNOW WHAT- LEGISLATIVE
ANALYST'S OFFICE STATED IT'S
IMPERATIVE THAT WE IDENTIFIED
THE PROBLEM WERE SEEKING TO
SOLVE AND DEVELOP SOLUTIONS THAT
WILL TRULY. HELP ALL OF
CALIFORNIA. LAST YEAR THE LETTER
. ENACTED LEGISLATION S. B.
THIRTEEN TWENTY TWO WE ARE A LOT
OF FOLKS REFERENCE THAT DAPPER
WILL REQUIRE REFINERY SPECIFIC
DATA REGARDING COST PAID FOR
CRUDE OIL. QUANTITY OF WHOLESALE
GASOLINE MEETING CALIFORNIA'S
SPECIFICATIONS SOLD
CONSIDERATION FOR A LOCAL STATE
AND FEDERAL TAXES AND THE COST
OF COMPLYING WITH THE LOW CARBON
FUEL STANDARD AND A CAP
INTRIGUED TO BE REPORTED TO THE
CDC BEGINNING THIS YEAR. WE HOPE
THE COLLECTION OF THIS DATA WILL
HELP SHED ADDITIONAL LIGHT. ON
THE FACTORS AFFECTING GAS PRICES
HERE IN CALIFORNIA WE HEARD LOUD
AND CLEAR FROM SEVERAL
PRESENTERS TODAY THAT MORE
ACCESS TO DATA IS NECESSARY TO
GAIN. A GREATER UNDERSTANDING OF
THE GASOLINE FUELS MARKET. AS I
CLOSE THIS HEARING TODAY I LOOK
FORWARD TO OUR ONGOING
COLLABORATION. WITH MY
COLLEAGUES HERE ON THE SENATE
ENERGY COMMITTEE THE ASSEMBLY
THE ADMINISTRATION AS A WHOLE
AND ALL OF OUR STAKEHOLDERS TO
SHAPE THE POLICY PROPOSAL THAT
WILL MEET THE CHALLENGES. TO
ENSURE AFFORDABLE AND RELIABLE
GASOLINE SUPPLIES FOR ALL OF
CALIFORNIA. AND AS I'VE STATED
BEFORE. MAKE SURE IT FIRST DOES
NO HARM TO NO ONE. THANK YOU
EVERYONE FOR YOUR PARTICIPATION
WE HAVE CONCLUDED TODAY'S AGENDA
THE SENATE COMMITTEE ON ENERGY
UTILITIES AND COMMUNICATIONS NOW
STANDS ADJOURNED. THANK YOU
MISTER CHAIR.