BILL ANALYSIS
AB 1340
Page 1
CONCURRENCE IN SENATE AMENDMENTS
AB 1340 (Kehoe)
As Amended September 2, 2003
Majority vote
-----------------------------------------------------------------
|ASSEMBLY: |74-0 |(May 22, 2003) |SENATE: |23-14|(September 10, |
| | | | | |2003) |
-----------------------------------------------------------------
Original Committee Reference: U. & C.
SUMMARY : Requires oil refiners, producers, transporters,
marketers, pipeline operators, and terminal operators, as
specified, to submit weekly, rather than monthly, reports to the
California Energy Commission (CEC) relating to inventory levels,
gasoline imports and exports, and other specified information.
The Senate amendments outline with additional specificity what
information is to be included in the weekly reports, and allow
persons submitting the information to request that it be held in
confidence pursuant to existing CEC confidentiality statutes.
EXISTING LAW requires major oil producers, refiners, major
marketers, major oil transporters, and major oil storage
facilities to supply to CEC each month certain designated
information regarding petroleum supplies.
FISCAL EFFECT : According to the Senate Appropriations
Committee, CEC is in the process of promulgating similar
regulations, it is difficult to determine to what extent the
increased costs may be associated with the regulations or this
bill. Costs are estimated to be in the range of $150,000
annually.
COMMENTS : Between January 1, 2003 and March 17, 2003, the
statewide average retail price of regular gasoline jumped 36%,
climbing from $1.58 a gallon to a record-setting $2.15 a gallon
on March 17, 2003, an increase of $0.57.
In August 2003, gasoline prices in the western United States
jumped by about $0.17 a gallon to an average of $1.89, which is
the second highest weekly regional price rise recorded by the
federal Energy Information Administration. In addition, there
have been several unplanned oil refinery shutdowns in the state
AB 1340
Page 2
and a refinery outage in Washington during the month of August.
A pipeline from the East that supplies about 30% of the gasoline
used in Phoenix, Arizona via Tucson was shut down completely on
August 8, 2003 due to a rupture, resulting in additional
gasoline exports from California, which already had tight
supplies.
California enjoys significant refinery capacity. At maximum
production, the state's refineries make more than 44 million
gallons of gasoline a day, but the state imports an estimated
100 million gallons of gasoline and blend stocks each month to
meet demand.
Weekly versus monthly information: In its March 28, 2003,
report on gasoline and diesel price spikes, CEC concluded it
needs the information it's now getting on a monthly basis on a
weekly basis instead. It believes the information is necessary
to more accurately track inventories, imports, and exports, all
of which will help CEC more precisely determine the causes of
price spikes. CEC recommended that the petroleum industry
change its current practice of submitting information on a
monthly basis and begin voluntarily submitting reports to CEC
weekly. This bill gives effect to that recommendation.
Regulatory proceedings are currently underway at CEC to modify
reporting requirements for the petroleum industry. The
contemplated regulations require weekly reporting from the
industry.
Analysis Prepared by : Paul Donahue / U. & C. / (916) 319-2083
FN: 0003355