Assembly hearing: agencies warn refinery exits could tighten California fuel market; agencies promise a transition plan

SACRAMENTO — State energy, air-quality and market‑oversight officials told the Assembly Committee on Utilities and Energy on Oct. 26 that California faces a narrowing cushion between refining capacity and fuel demand and that recent refinery closure announcements make planning for the transition away from petroleum more urgent.

The hearing, led by Assemblymember Cottie Petrie‑Norris, brought together California Air Resources Board Chair Leanne Randolph, California Energy Commission Vice Chair Siva Gunda, and the newly created Division of Petroleum Market Oversight director Ty Melder to brief legislators on supply, price spikes and planned agency work. “We need a real plan,” Petrie‑Norris said in opening remarks, describing the session as an effort to lay out the state’s options.

The agencies emphasized three priorities: increase market transparency, plan and coordinate a statewide “fuels transition” strategy, and evaluate narrowly the permissive authorities the legislature gave regulators in SBX1‑2 and ABX2‑1 to stabilize supply if benefits exceed risks. Gunda said the agencies were “digging through the analysis” to decide whether to use those tools and would be “prudent” about imposing requirements that could raise costs for consumers.

Why it matters: California’s refining system serves local demand and parts of Nevada and Arizona. Regulators said in‑state refining capacity has declined over the past decade while imports and supply chain outages have played a…