Bay Area drivers react to Newsom signing bill targeting gas price spikes
Gov. Gavin Newsom signed a bill Monday afternoon that seeks to lower gas prices in California by granting the energy regulators the ability to require oil refineries to have a minimum amount of gasoline in storage at all times.
The goal is to keep gas prices from rising when the refineries shutter for maintenance work, which Newsom calls the one of driving forces of gas price spikes.
"One of the principal issues that was holding back our capacity to tame these price spikes was the issue around supply issues, around maintenance issues, around refineries," Newsom said at the signing.
Lauren Wickham commutes between Marin County and San Francisco, spending an average of $200 a month on gas. Wichman said she's in support of anything that has the potential to lower prices as the pump.
"If I have a car, I might as well use it," she told CBS News Bay Area. "I'd rather spend it on other things."
Wickham represents the thousands of commuters in San Francisco paying some of the highest gas prices in the country. According to AAA, the national average is about $3.20, but in San Francisco, drivers shell out about $5 a gallon.
Opponents of Newsom's gas bill, like Catherine Reheis-Boyd of the Western States Petroleum Association, said the new law does little to address the real issues causing high gas prices in California.
Instead, she said the bill will only increase costs for refineries who will need to maintain storage, create dangerous conditions for refinery workers and potentially raise prices at the pump.
"This is legislators who do not understand how a refinery works," said Reheis-Boyd, president of the trade group. "There are ways we should be talking about that we brought to the table, to really influence bringing supply to market and minimizing price volatility."
Severin Borenstein, the faculty director of the Energy Institute at UC Berkeley's Haas School of Business believes the law will benefit consumers, but not substantially.
"I don't think this is going to have much effect at all most of the time, and it will have a small effect in dampening gas prices occasionally," he told CBS News Bay Area.
Borenstein said big refinery maintenance work doesn't happen enough to cause consistent price spikes. The new law may provide consumers some relief, as they may see a small dip in prices but not enough to drive down the overall costs at the pump.
"Most of the problem with California's high gas prices above and beyond the fact that we have higher taxes and environmental fees, is not due to the supply shortages," Borenstein said. "Most of it is actually happening downstream from the actual supply of gasoline in the distribution and marketing and retailing sectors. And this law isn't going to address that at all."
Following Newsom's signing, the bill goes into effect in 90 days.
