Amended in Senate May 6, 2013

Amended in Senate April 23, 2013

Amended in Senate April 1, 2013

Senate Bill No. 448

Introduced by Senator Leno

February 21, 2013

An act to add Section 25356.5 to the Public Resources Code, relating to energy.

LEGISLATIVE COUNSEL’S DIGEST

SB 448, as amended, Leno. Energy: petroleum supply and pricing.

Existing law establishes the State Energy Resources Conservation and Development Commission in the Natural Resources Agency, and specifies the powers and duties of the commission with respect to energy resources in the state. Under existing law, various provisions regulate petroleum supply and pricing. Existing law requires the commission to obtain and analyze monthly production reports prepared by the State Oil and Gas Supervisor under a specific provision. Existing law authorizes the State Lands Commission to enter into oil and gas leases for the extraction and removal of oil and gas deposits on state lands. Existing law requires the leases to include a royalty provision.

This bill would require the State Energy Resources Conservation and Development Commission, upon appropriation by the Legislature begin delete from end delete begin insert of end insert moneys generated by the collection of royalty payments from the oil and gas leases, to identify motor vehicle fuel price manipulation, establish a methodology to determine whether begin delete motor vehicle end delete fuel price manipulation is occurring, and analyze data and investigate for suspected begin delete motor vehicle end delete fuel price manipulation. The bill would require the commission, in consultation with the State Air Resources Board and other relevant state agencies, to prepare and submit to the Legislature a report on further legislative recommendations to limit the amount of price volatility and comparative price increase in the California begin delete motor vehicle end delete fuel market.

Vote: majority. Appropriation: no. Fiscal committee: yes. State-mandated local program: no.

The people of the State of California do enact as follows:

SECTION 1.  

Section 25356.5 is added to the Public Resources
Code, to read:

25356.5.  

(a) In addition to the requirements of begin delete section end delete begin insert Section end insert
25356, the commission begin insert shall do all of the following: end insert

(1) Establish a definition for begin delete motor vehicle end delete fuel market
manipulation.

(2) Identify data necessary to determine whether begin delete motor vehicle end delete
fuel pricing manipulation is occurring that includes all of the
following:

(A) Individual begin delete motor vehicle end delete fuel producer data, including all
of the following:

(i) Production or throughput data.

(ii) Emission data or operational data.

(iii) Sales volumes.

(iv) Price.

(B) Marketwide pricing data.

(3) Establish an analytical methodology necessary to evaluate
whether begin delete motor vehicle end delete fuel price manipulation is occurring that
includes both of the following:

(A) Producer level analysis.

(B) Marketwide analysis, comparing real time prices to expected
prices based on modeling output.

(4) Analyze the data and investigate for suspected begin delete motor vehicle end delete
fuel price manipulation using both of the following:

(A) Producer level analysis.

(B) Marketwide analysis.

(b) The commission, in consultation with the State Air Resources
Board and other relevant state agencies, shall include in the biennial
assessment specified in subdivision (b) of Section 25358 a report
on further legislative recommendations to limit the amount of price
volatility and comparative price increase in the California begin delete motor
vehicle end delete fuel market. The report shall include an evaluation of
strategies doing all of the following:

(1) Increasing begin delete motor vehicle end delete fuel storage.

(2) Leveraging the state’s purchasing power related to the state’s
fleet.

(3) Increasing timely imports of begin delete motor vehicle end delete fuels during price
swings.

begin insert

(c) For purposes of this section, “fuel” means gasoline and
diesel derived from petroleum.

end insert begin delete

(c)

end delete

begin insert (d) end insert  The commission shall implement this section upon
appropriation by the Legislature of moneys generated by the
collection of royalty payments from oil and gas leases entered into
pursuant to Article 2 (commencing with Section 6826) of Chapter
3 of Part 2 of Division 6.