Senate Bill X1-2
Senate Bill X1-2 (SB X1-2), the California Gas Price Gouging and Transparency Law, was signed by Governor Gavin Newsom in March 2023.
The law was passed during a special legislative session convened to protect Californians from price spikes at the pump, after consumers experienced extreme gasoline prices in fall 2022. The law introduced new data reporting and oversight measures to provide state agencies with better information to understand the complexities of the petroleum industry, support long-term planning efforts, increase industry accountability, and protect consumers.
Specifically, the law states that:
- The petroleum industry—oil producers, refiners, marketers, transporters, and storers—will submit additional information and detailed data to the California Energy Commission (CEC), enabling the CEC to better assess and predict price trends and protect consumers from price spikes.
- Refineries must report to the CEC the timing and expected impact of refinery maintenance outages.
- Refineries must give the CEC one year notice of any plans to shut down or reconfigure their operations.
- The CEC shall produce a transportation fuels assessment every three years reporting on the state of the transportation fuels market, including policy options to improve market stability, reliability, and affordability.
- The CEC shall assess the effects of implementing a maximum gross gasoline refining margin and penalty to determine if such a profit margin and penalty system would help control price spikes or cause unintended impacts to supply or prices.
- The CEC and California Air Resources Board shall develop a transportation fuels transition plan to plan and monitor the state’s transition away from petroleum fuels.
- The Division of Petroleum Market Oversight (DPMO) will be created as a new and independent division within the CEC responsible for oversight, investigation, economic analysis, and policy recommendations related to the transportation fuels market.
- The Independent Consumer Fuels Advisory Committee will be created as an independent committee to advise the CEC and DPMO. Members are appointed by the Governor, the Speaker of the Assembly, and the Senate Committee on Rules.
Assembly Bill X2-1
Assembly Bill (AB) X2-1, the Reducing Gasoline Price Risks Law, signed in October 2024, further enhances the provisions of Senate Bill X1-2.
Specifically, the law states that:
- The California Energy Commission (CEC) will assess and may develop a framework for resupply requirements that would require oil refiners to plan for resupply during planned maintenance outages to avoid supply shortages that create higher gasoline prices for consumers.
- The CEC will assess and may develop a framework for minimum inventory requirements that would require oil refiners to maintain a minimum inventory of fuel to support market liquidity and help avoid price spikes.
- The CEC’s transportation fuels assessment will be expanded to evaluate California’s future petroleum product and crude oil import needs, and identify steps needed to ensure that marine infrastructure and port facilities can accommodate those needs.
Read updates on SB X1-2 and AB X2-1 implementation below.
Requirements: Expands the CEC’s data collection authority for the petroleum industry.
Status: The CEC is collecting and publishing additional data from the petroleum industry including monthly and historical costs and profits, daily spot market transactions, and refinery maintenance reports. All this data helps expand the CEC’s knowledge about how the petroleum market works.
The CEC is required to publish aggregated reports for the monthly refiner data on gasoline production, sales, and cost. Staff analysis for each month is posted on the SB 1322 webpage.
At the October 18, 2023 business meeting, the commissioners voted to start a rulemaking focused on refiner maintenance.
At the February 14, 2024 business meeting, the CEC adopted emergency regulations to increase reporting of spot market transactions for greater transparency. These regulations will be in place from February 26, 2024 to February 26, 2026.
At the May 8, 2024 business meeting, the CEC adopted emergency regulations to increase reporting of refinery maintenance, refiner margins, and marine imports for greater transparency. These regulations will be in place from May 20, 2024 to May 20, 2026.
At the July 10, 2024, business meeting, the CEC adopted emergency regulations to increase reporting of inventory holdings and spot market dynamics for greater transparency. These regulations will be in place from July 22, 2024 to July 22, 2026.
At the February 12, 2025, business meeting, the CEC adopted emergency regulations to clarify reporting requirements for petroleum refiner and major marketer three-month projections. These regulations will be in place from February 24, 2025, to February 25, 2027.
On July 11, 2025, the CEC opened rulemaking proceedings regarding certifying emergency regulations adopted in February 2024, May 2024, July 2024, and February 2025. Certifying these emergency regulations will make these adopted emergency regulations permanent. The CEC is proposing no changes to the express terms as they were written when adopted as an emergency regulation. Materials for this proceeding can be found on docket 23-OIR-03.
The regulations help provide information that can be used to better analyze market behavior and to help look at what actions can be taken to reduce gasoline price spikes. During the two-year effective period, the CEC may undergo the regular rulemaking process to make these regulations permanent.
Requirements: Authorizes the CEC to set a maximum gross refining margin and to impose a civil penalty for exceeding that margin.
Status: The law requires the CEC to conduct an analysis on the effects of a margin penalty. This analysis will require profit margin information, which refiners have begun providing.
At the October 18, 2023 Business Meeting, the Commissioners voted to start a proceeding looking at whether to establish a maximum margin and penalty. The CEC held a workshop on April 11, 2024 to explore the structures for determining a maximum margin and penalty.
The idea to deprioritize implementation on maximum gross gasoline refining margins was first proposed in the CEC's response to Governor Newsom's letter on June 27, 2025.
On August 28, 2025, a draft report with findings that an implementation pause for no less than 5 years extending to 10 years on a conditional basis was published; the final report was published on October 9, 2025.
At the August 29, 2025 Business Meeting, the Commissioners resolved to deprioritize implementing the maximum GGRM and penalty for at least five years while the state continues to develop and implement a sector-wide managed transition strategy. The CEC reserved the right to revise or rescind the resolution and committed to continued data collection and analysis to assess a maximum GGRM.
The CEC is continuing to perform analysis to assess the potential impacts of a maximum GGRM, with plans to publish an updated analysis by early 2027.
The Transportation Fuels Assessment is a leading component of SB X1-2. The first Transportation Fuels Assessment was published in August 2024 and identifies potential alternative methods to ensure a reliable supply of affordable and safe transportation fuels in California, evaluates the price of transportation fuels, considers supply conditions, assesses the impact of refinery closures, analyzes impacts on production from refinery maintenance and turnarounds, evaluates the feasibility of alternative methods to maintain adequate supply of fuels, and proposes solutions to mitigate impacts described elsewhere in the assessment.
Requirements: Develop and submit the second triennial Transportation Fuels Assessment by January 1, 2027, as required by PRC Section 25371. The 2027 Assessment builds on the 2024 Assessment and incorporates expanded requirements enacted through AB X2-1 (2024) and SB 237 (2025).
Status: The CEC is currently developing the 2027 Assessment which will be discussed in upcoming workshops. The Assessment is expected to be adopted at a CEC Business Meeting in December 2026.
Requirements: The CEC and the California Air Resources Board (CARB) must prepare a Transportation Fuels Transition Plan.
Status: The Transition Plan will identify how to plan for and monitor progress toward the state’s transition away from petroleum fuels, incorporating results from the first Transportation Fuels Assessment. The CEC and CARB held a workshop on May 3, 2024 to discuss the draft Assessment and the Transition Plan. The Plan will include results from consultation efforts from a multistakeholder, multiagency workgroup. It will also include results and considerations from community outreach efforts in refinery communities. The Transition Plan draft and its Appendix A and Appendix B are now available.
Requirements: The CEC is consulting with the California Department of Industrial Relations on managing refinery turnaround to ensure safety and supply availability.
Status: The CEC is working on developing regulations that address refinery maintenance programs and related issues of ensuring adequate supply. The draft regulations are expected to be released in spring 2024.
Guidelines for event-based reporting for planned and unplanned maintenance were published May 2024.
Second edition guidelines for event-based reporting for planned and unplanned maintenance were published August 2025.
Requirements: Create an independent committee to advise the CEC and DPMO. Appointees would come from the Governor, the Speaker of the Assembly, and the Senate Committee on Rules.
Status: The Speaker of the Assembly appointed Timothy Jefferies to the Independent Consumer Fuels Advisory Committee on March 26, 2025. The Senate Committee Rules named Antonio Sanchez as an appointee to the advisory committee on August 23, 2023. On October 14, 2024, Governor Newsom appointed five members to the advisory committee: Martha Dina Arguello, Michael Jorgenson, Neale Mahoney, Norman Rogers, and Astrid Zuniga.
Requirements: The California Department of Tax and Fee Administration and the CEC must develop an annual report to examine the relationship between gasoline prices and state revenues.
Status: The 2024 report was published in May 2024. The 2025 and 2026 reports are under review ahead of publication.
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