Antonio Villaraigosa’s Plan to Lower Gas Prices

Message from Antonio

Californians are paying more for gasoline than anyone else in the country — and it's getting worse.

My answer is direct: we have to lower prices for working families.

Right now, most of our vehicles use gasoline - and that isn’t changing anytime soon, especially for working families. To lower prices, we must stop importing foreign oil (especially in light of Trump’s war in Iran), cut regulatory red tape driving up costs, invest in clean fuels, and maintain responsible environmental protections that ensure California continues to produce the cleanest fuel in the world.

This is not a choice between affordable energy and a clean environment. It is a choice between a managed, pragmatic approach that maintains California's refining capacity, protects over 500,000 oil and gas jobs, preserves $2.7 billion in revenue for clean energy projects, and brings gas prices down — or an ideological approach that shutters refineries, spikes prices, and leaves working families holding the bill.

Priorities

  1. LOWER GAS PRICES FOR WORKING FAMILIES

  2. PROTECT AND SUPPORT CALIFORNIA'S REFINING CAPACITY

  3. CUT REGULATORY RED TAPE DRIVING UP ENERGY COSTS

  4. INVEST IN THE INDUSTRY'S FUTURE: CCUS, CLEAN FUELS, AND ENHANCED RECOVERY

  5. MAINTAIN RESPONSIBLE ENVIRONMENTAL PROTECTIONS

  6. REFORM AND OVERHAUL THE CALIFORNIA AIR RESOURCES BOARD

PRIORITY 1: LOWER GAS PRICES FOR WORKING FAMILIES

The goal is simple: Californians should not be paying $2 or $3 more per gallon than the rest of America because of Sacramento’s policy choices.

My Administration will attack gas prices from both the supply side (supporting in-state refining, reducing regulatory costs passed through to consumers) and the demand side (monitoring refiner margins, ensuring fair pricing, and delivering direct relief when prices spike).

Supporting in-state oil and gas production is a direct lever for reducing gas prices. Every barrel of crude oil produced in California reduces the state’s dependence on imported crude, which must be shipped by tanker, adding cost, time, and emissions. California’s in-state crude production, while declining, is extracted under the strictest environmental standards in the world; replacing it with imports from countries with far weaker standards does not advance environmental goals. It simply exports the pollution while importing the cost.

I have pointed to the stakes: “Look at Norway: it’s one of the greenest countries in the world, but it still produces oil and gas. They use that revenue to fund their transition to green energy.” California should follow that model by producing responsibly, using the revenue to invest in clean energy, and stopping the punishment of working families with gas prices that are the direct result of policy choices.

My Administration will support a California Fuel Affordability Guarantee (CFAG) which caps gas prices for working families.

California should establish a Fuel Affordability Guarantee that provides automatic, targeted relief to working families when gas prices exceed a defined threshold. When the statewide average regular gasoline price exceeds $5.50 per gallon for 30 consecutive days, the state would automatically disburse monthly fuel assistance payments to income-qualified households (income below 400% FPL) via the Franchise Tax Board. Payments would equal the per-gallon differential above $5.50, multiplied by an estimated 80 gallons per month, for each registered vehicle in the household (up to two).

Funding would be sourced from:

(1) windfall revenues captured through the CEC’s margin cap authority (which generates state revenue when refiner margins exceed the cap);

(2) a portion of cap-and-trade auction proceeds (which increase when fuel prices increase); and

(3) if needed, General Fund appropriations during price emergencies. The automatic trigger mechanism eliminates the need for legislative action during each price spike, ensuring relief reaches families within 30 days of the trigger.

IMPACT ON GAS PRICES: Combined supply-side and demand-side actions in this section (margin monitoring, LCFS cost containment, direct relief during spikes) could close up to half of California’s $1.40/gallon premium over the national average, saving the average household $700+ per year.

  • •     Division of Petroleum Market Oversight (Pub. Resources Code § 25354 et seq.): The Division has authority to monitor petroleum markets, investigate pricing anomalies, and recommend enforcement actions. The Governor can direct the Division to prioritize investigation of the persistent “mystery surcharge” and to publish transparent pricing data that holds refiners publicly accountable.

    •     Maximum Refining Margin Authority (Pub. Resources Code § 25355): ABX2-1 authorized the CEC to set a maximum gross gasoline refining margin during periods of market tightness. This authority should be used as a targeted backstop against price manipulation — not as a permanent price control that discourages investment. The key is calibrating the margin cap to prevent exploitation while preserving the profitability necessary for continued operations.

    •     LCFS Cost Containment (17 CCR § 95480 et seq.): CARB has regulatory authority to adopt cost-containment mechanisms within the LCFS, including credit price ceilings. The Governor can direct CARB to implement a firm credit price ceiling that limits the pass-through of LCFS compliance costs to consumers.

    •     Cap-and-Trade Cost Containment (17 CCR § 95911): The cap-and-trade regulation already includes a price containment mechanism (Allowance Price Containment Reserve). The Governor can direct CARB to ensure the APCR is adequately funded and that allowance prices do not spike in ways that increase fuel costs beyond what is necessary to meet emissions targets.

    •     California Penal Code § 396 (Price Gouging): During declared emergencies (including supply disruptions from refinery closures), California’s anti-price gouging statute prohibits raising the price of consumer goods — including gasoline — by more than 10%. The Governor can ensure that any refinery closure that creates a supply emergency triggers these protections.

    •    Appropriating Funds for Consumer Relief (CA Constitution, Art. IV, § 12): The Franchise Tax Board has proven capacity to administer income-verified direct payments (Middle Class Tax Refund, Golden State Stimulus). An automatic trigger can be codified in statute, with the Controller directed to certify the trigger condition based on CEC pricing data.

PRIORITY 2: PROTECT AND SUPPORT CALIFORNIA’S REFINING CAPACITY

California’s refining industry is in crisis not because of market forces alone, but because Sacramento has created a regulatory environment so hostile that refineries cannot justify continued investment. Phillips 66 shut down its 139,000-barrel-per-day Wilmington refinery in 2025. Valero is closing its 145,000-barrel-per-day Benicia facility by spring 2026. Together, these closures eliminate nearly 20% of California’s refining capacity. The result will be higher gas prices, greater import dependency, and the loss of thousands of jobs with no net reduction in global emissions, since the fuel Californians consume will simply be refined elsewhere under weaker environmental standards. A Villaraigosa Administration will treat refinery retention as a priority, reform the regulatory barriers driving refineries out of California, and ensure that the remaining refining infrastructure has the regulatory certainty needed to continue operating and investing.

My Administration will support the California Refinery Retention and Investment Act.

California should enact a Refinery Retention and Investment Act that provides meaningful incentives for existing petroleum refineries to continue operating in California and to invest in operational improvements. The Act would include:

(1) a 10-year regulatory stability guarantee for refineries that commit to continued operations and compliance with existing environmental standards, protecting them from retroactive application of new regulatory requirements during the stability period;

(2) an expedited permitting pathway for refinery capital investments that improve efficiency, reduce emissions, or add CCUS capacity; and

(3) a state investment tax credit of 15% for qualifying refinery modernization expenditures (up to $50 million per facility per year).

The economic case is straightforward: a single large refinery generates approximately $1.5 to $3 billion in annual economic activity, supports 1,000 to 3,000 direct jobs (averaging $85,000+ in wages), and generates tens of millions in local property and sales tax revenue. The cost of retaining a refinery through tax credits and regulatory certainty is a fraction of the cost the state bears when one closes — in lost tax revenue, unemployment insurance, gas price increases, and import dependency.

IMPACT ON GAS PRICES: Retaining California’s remaining refining capacity prevents the projected $1.21+/gallon price increase from further closures — saving a typical two-vehicle household $1,200 to $2,400 per year at the pump.

  • The U.S. Department of Energy has identified California’s refinery capacity reduction as a national energy security vulnerability. California refineries supply not only the state’s 40 million residents but also more than one-third of Arizona’s gasoline and 86% of Nevada’s motor fuels.[1][2] The loss of 20% of in-state capacity means that California must import significantly more finished gasoline by tanker which is a more expensive, less reliable, and more carbon-intensive supply chain than in-state refining. Every barrel refined in California under the state’s strict environmental standards is a barrel that would otherwise be refined in a jurisdiction with fewer controls.

    Gas price projections are alarming. UC Davis researchers project a baseline increase of $1.21 per gallon once both closures take full effect, and worst-case scenario analyses have projected prices exceeding $8 per gallon if closures coincide with supply disruptions or seasonal demand spikes.[3] As of late 2025, California drivers already pay approximately $4.34 per gallon which amounts to $1.40 above the national average. At projected post-closure levels, a typical two-vehicle household consuming 1,000 gallons annually would face $1,200 to $2,400 in additional fuel costs per year. These increases fall hardest on the working families and middle-class Californians who drive to work, haul goods, and run small businesses.

    The regulatory environment is the proximate cause. Villaraigosa has noted: "We’ve made it so difficult for refineries to exist in this state."[4] Multiple layers of regulation including the state’s unique fuel blend specifications, the Low-Carbon Fuel Standard’s escalating compliance costs (projected to add $0.30 to $0.70 per gallon by 2030), cap-and-trade obligations, and aggressive emissions mandates imposed without corresponding support for compliance, have made California’s refineries among the most expensive to operate in the world.[5] This is not an argument against environmental standards; it is an argument for standards that are achievable, predictable, and paired with the regulatory certainty that industry needs to justify continued investment.

    [1]Western States Petroleum Association, "California Fuel Facts," 2025. California refineries supply more than one-third of Arizona's gasoline and 86% of Nevada's motor fuels.

    [2]U.S. Energy Information Administration, “Refinery closures and rising consumption will reduce U.S. petroleum inventories in 2026,” 2025; see also U.S. DOE and EIA analyses documenting that premature refinery closures without replacement infrastructure create fuel security vulnerabilities.

    [3]California State Senate, Office of Senate Minority Leader Brian Jones, May 2025, citing analysis by USC Professor Michael Mische. Worst-case projections estimated prices reaching $8.43/gallon under combined refinery closures and supply disruption conditions. UC Davis CAES provides the more conservative baseline of $1.21/gallon increase (see note 2, supra).

    [4] See note 3, supra. GVWire, “Antonio Villaraigosa lays out 2026 California governor campaign plan: lower costs, all-of-the-above energy,” September 29, 2025.

    [5]California Budget and Policy Center. The LCFS credit price, if unconstrained, could add $0.30 to $0.70 per gallon to gasoline prices by 2030.

  • •     Governor’s Executive Authority: The Governor can issue an executive order directing all state agencies — including CARB, the CEC, and CalGEM — to conduct a comprehensive regulatory impact assessment of all rules and policies affecting petroleum refining operations in California, with the explicit goal of identifying and eliminating rules that impose excessive costs without commensurate environmental benefit. This is within the Governor’s general executive authority under Cal. Const., Art. V, § 1.

    •     California Energy Commission (Pub. Resources Code §§ 25000 et seq.): The CEC has statutory responsibility for energy supply adequacy. The Governor can direct the CEC to treat in-state refining capacity as a critical energy security asset and to formally assess the supply and price impacts of any further refinery closure before it occurs.[1]

    •     Division of Petroleum Market Oversight (Pub. Resources Code § 25354 et seq.): Created by ABX2-1 (2023 extraordinary session), this CEC division monitors petroleum markets. The Governor can direct the Division to expand its mandate to include regulatory burden analysis and to recommend regulatory reforms that reduce unnecessary costs on refinery operations.

    •     CARB Regulatory Authority (Health & Safety Code §§ 38500–38599): CARB administers the cap-and-trade program and the LCFS. The Governor can direct CARB to adopt cost-containment mechanisms (credit price ceilings, compliance flexibility) that prevent these programs from imposing costs on refineries that exceed what is necessary to achieve California’s emissions targets. CARB has existing statutory authority to do so under Health & Safety Code § 38562(b).[2]

    •     CalGEM (Pub. Resources Code §§ 3000 et seq.): CalGEM regulates all oil and gas operations. The Governor, through the Director of the Department of Conservation, can direct CalGEM to streamline permitting for operational modifications at existing refineries (e.g., efficiency upgrades, emissions reduction retrofits, CCUS installations) to reduce the regulatory friction that discourages capital investment.[3]

    [1]Public Resources Code §§ 3000 et seq. (CalGEM); § 3106 (well permitting authority); §§ 25000 et seq. (CEC).

    [2]AB 32, California Global Warming Solutions Act (2006), Health & Safety Code §§ 38500–38599.

    [3] See note 13, supra. Public Resources Code §§ 3000 et seq. (CalGEM); § 3106 (well permitting authority).

    •     Maximum Refining Margin Authority (Pub. Resources Code § 25355): ABX2-1 authorized the CEC to set a maximum gross gasoline refining margin during periods of market tightness. This authority should be used as a targeted backstop against price manipulation — not as a permanent price control that discourages investment. The key is calibrating the margin cap to prevent exploitation while preserving the profitability necessary for continued operations.

    •     LCFS Cost Containment (17 CCR § 95480 et seq.): CARB has regulatory authority to adopt cost-containment mechanisms within the LCFS, including credit price ceilings. The Governor can direct CARB to implement a firm credit price ceiling that limits the pass-through of LCFS compliance costs to consumers.

    •     Cap-and-Trade Cost Containment (17 CCR § 95911): The cap-and-trade regulation already includes a price containment mechanism (Allowance Price Containment Reserve). The Governor can direct CARB to ensure the APCR is adequately funded and that allowance prices do not spike in ways that increase fuel costs beyond what is necessary to meet emissions targets.

    •     California Penal Code § 396 (Price Gouging): During declared emergencies (including supply disruptions from refinery closures), California’s anti-price gouging statute prohibits raising the price of consumer goods — including gasoline — by more than 10%. The Governor can ensure that any refinery closure that creates a supply emergency triggers these protections.

    •    Appropriating Funds for Consumer Relief (CA Constitution, Art. IV, § 12): The Franchise Tax Board has proven capacity to administer income-verified direct payments (Middle Class Tax Refund, Golden State Stimulus). An automatic trigger can be codified in statute, with the Controller directed to certify the trigger condition based on CEC pricing data.

    •   Enacting Targeted Tax Credits (Cal. Rev. & Tax Code §§ 17053, 23600 et seq. ). The Legislature has authority to enact targeted tax credits. Regulatory stability guarantees are within the Legislature’s police power, subject to the state’s reserved authority to address genuine public health and safety emergencies. Expedited permitting for facility improvements is achievable through CalGEM and local APCD regulatory coordination under existing statutory frameworks.

PRIORITY 3: CUT REGULATORY RED TAPE DRIVING UP COSTS

California has layered regulation upon regulation on the oil and gas industry often with good intentions but without adequate consideration of cumulative cost impacts on consumers and the industry’s economic viability. The Low-Carbon Fuel Standard, cap-and-trade, unique fuel-blend specifications, escalating air quality requirements, and well-permitting delays have created a regulatory environment that is opaque, unpredictable, and punitive. A Villaraigosa Administration will conduct a comprehensive regulatory review of all rules affecting oil and gas operations, eliminate redundant or unjustified mandates, introduce cost-containment mechanisms where climate programs threaten energy affordability, and establish a regulatory coordination office to ensure that industry engages with one state process rather than a dozen.

IMPACT ON GAS PRICES: Reducing the California regulatory premium by even 25% through streamlined permitting and cost containment would save the average California driver $130 to $340 per year. Faster permitting for efficiency upgrades helps refineries lower operating costs that are ultimately passed to consumers.

  • The cumulative cost of California-specific regulations on gasoline has been estimated at $0.50 to $1.30 per gallon above the costs imposed in other states, according to analyses by the California Budget and Policy Center, the CEC Division of Petroleum Market Oversight, and industry studies (the range reflects differing methodological assumptions about cost allocation and pass-through rates). The components include: LCFS compliance costs ($0.10–$0.25 currently, projected to reach $0.30–$0.70 by 2030); cap-and-trade allowance costs ($0.10–$0.15 per gallon); unique California reformulated gasoline blend specifications ($0.10–$0.20); and various other fees and assessments.[1] These costs are not inherently unreasonable because each regulation addresses a legitimate policy objective, but their cumulative impact on a single industry, without cost-containment guardrails, has created a competitive disadvantage that is driving capital and capacity out of California.

    California’s well-permitting timelines have also become a significant burden. Under CalGEM, the average time from application to permit issuance for a new oil or gas well has increased substantially, with operators reporting wait times exceeding 12 months for routine permits that other states process in weeks. This delay is not primarily a function of environmental review complexity; it reflects understaffing, process inefficiency, and a regulatory culture that treats delay as a de facto tool for discouraging production. Meanwhile, California’s in-state crude oil production has fallen to 325,000 barrels per day, increasing the state’s dependence on imports.[2]

    Norway, the model Villaraigosa has cited, provides an instructive contrast. Norway produces approximately 2 million barrels per day of crude oil, maintains one of the world’s most stringent environmental regulatory frameworks, and yet has streamlined its permitting and regulatory processes so that operators have regulatory predictability. The result: The industry thrives, revenues fund the world’s largest sovereign wealth fund ($1.9 trillion), and Norway leads the world in electric vehicle adoption and per-capita renewable energy investment.[3],[4] The lesson is rather clear. Environmental leadership and a productive oil and gas industry are not merely compatible and they are mutually reinforcing when revenues from production fund the clean energy transition.

    [1] See note 12, supra. California Budget and Policy Center; CEC Division of Petroleum Market Oversight; industry studies. The range ($0.50–$1.30/gallon) reflects differing methodological assumptions about cost allocation and pass-through rates.

    [2]California Energy Commission, Quarterly Petroleum Report, Q1 2025. California produced 325,000 barrels per day in 2024, down from 1.1 million bbl/day in 1985.

    [3]Norges Bank Investment Management, 2025. Norway's Government Pension Fund Global held $1.9T+ in assets, funded entirely from petroleum revenues.

    [4]IMF Finance & Development, "Putting Oil Profits to Global Benefit," 2022. Norway's petroleum sector: 28% of GDP, 58% of exports in 2022.

  • •     Governor’s Reorganization Authority (Cal. Const., Art. V, § 1; Gov. Code §§ 12800 et seq.): The Governor has broad executive authority to reorganize state agencies, create interagency coordination bodies, and direct regulatory agencies to conduct reviews of their existing rules. A Governor’s Executive Order can establish a Regulatory Coordination Office for energy permitting and direct agencies to streamline overlapping requirements.

    •     CARB Cost-Containment Authority (Health & Safety Code § 38562(b)): CARB’s authorizing statute requires the Board to “design the emissions reduction measures” in a manner that “minimize[s] costs and maximize[s] the total benefits.” The Governor can direct CARB to prioritize cost-containment in the LCFS and cap-and-trade programs — including implementing credit price ceilings, compliance flexibility mechanisms, and phased implementation schedules that give industry time to adapt.

    •     CalGEM Permitting Authority (Pub. Resources Code §§ 3000–3106): CalGEM’s well permitting and inspection authority is set by statute. The Governor can direct the Department of Conservation to set permitting performance targets, increase staffing for permit processing, and adopt clear, predictable timelines for permit decisions.[1]

    •     California Environmental Quality Act, Existing Exemptions (Pub. Resources Code § 21084): CEQA already includes categorical exemptions for certain classes of projects. The Governor can support legislation creating a categorical exemption for emissions-reduction retrofits and efficiency upgrades at existing oil and gas facilities, reducing permitting timelines for projects that improve environmental performance.


    [1] See note 13, supra. Public Resources Code §§ 3000–3106.

PRIORITY 4: INVEST IN THE INDUSTRY’S FUTURE: CCUS, CLEAN FUELS, AND ENHANCED RECOVERY

The future of California’s oil and gas industry is not decline. Carbon capture, utilization, and storage (CCUS) technology allows continued operation of existing facilities while dramatically reducing their carbon footprint. Clean fuel production (renewable diesel, sustainable aviation fuel, green hydrogen) leverages existing refinery infrastructure, workforce skills, and supply chain logistics. Enhanced oil recovery with CO2 injection produces crude oil while permanently sequestering carbon underground. These are not speculative technologies. They are commercially proven and incentivized by federal tax credits. My administration will make California the national leader in CCUS deployment, clean fuel production, and technology-enhanced energy production.

My Administration will support the California CCUS Fast-Track Permitting and Investment Act.

California should enact a CCUS Fast-Track Permitting and Investment Act that:

(1) establishes a 12-month maximum permitting timeline for CCUS projects at existing industrial facilities;

(2) provides a state tax credit of $15/ton of CO2 permanently sequestered in California, stacking with the federal 45Q credit to make California the most attractive CCUS investment destination in the nation;

(3) creates a streamlined CEQA pathway (programmatic EIR) for CCUS projects that meet defined environmental performance standards; and

(4) directs CalGEM to apply for EPA Class VI well primacy to bring permitting under state control.

The combined federal ($85) and proposed state ($15) credit of $100/ton would make California’s CCUS incentive the most competitive in the country, attracting billions in private investment. At an estimated 10 million tons of CO2 per year of capture potential from California’s industrial facilities, the state tax credit would cost approximately $150 million annually — a modest investment that would generate thousands of high-paying jobs, billions in private capital expenditure, and measurable emissions reductions.

IMPACT ON GAS PRICES: Converting refineries to clean fuels rather than closing them maintains fuel supply infrastructure, preventing the supply gap that drives prices up. Every barrel of clean fuel produced in-state is a barrel that doesn’t need to be imported at premium prices.

  • SB 905 (2022) directed California agencies to develop the regulatory framework for CCUS, but implementation has been slow. Meanwhile, other states (Texas, Louisiana, Wyoming, North Dakota) have moved aggressively to attract CCUS investment, leveraging federal 45Q tax credits that provide up to $85 per metric ton of permanently sequestered CO2. California’s depleted oil and gas reservoirs in Kern County and saline formations in the Central Valley offer significant geologic storage capacity, but operators need regulatory clarity and permitting timelines to invest.[1]

    Refinery-to-clean-fuel conversion is already happening in California. The Marathon Martinez refinery conversion to renewable fuel production preserved hundreds of jobs and created a net-zero-emissions fuel facility on the site of a former petroleum plant. Phillips 66 has announced plans to convert its Wilmington facility to renewable fuels. These conversions demonstrate that refinery infrastructure and the workforce’s highly specialized skills can be redeployed rather than abandoned, but conversions require state regulatory support and investment incentives to pencil economically.

    Enhanced oil recovery (EOR) with CO2 injection is a particularly promising technology. CO2-EOR injects captured carbon dioxide into depleted oil reservoirs to increase oil production while permanently sequestering the CO2 underground. This technique is widely used in Texas and Wyoming, where it accounts for a significant share of production. In California, CO2-EOR could extend the productive life of mature Kern County fields while generating permanent carbon sequestration, thus turning oil production itself into a carbon-negative activity when paired with direct air capture.

    [1]SB 905, Carbon Capture, Utilization and Storage Program (2022). Directs California agencies to develop CCUS regulatory framework.

  • •     SB 905, CCUS Regulatory Framework (2022): SB 905 provides the statutory foundation for CCUS in California, directing state agencies to develop permitting, monitoring, and long-term liability frameworks. The Governor can direct agencies to accelerate SB 905 implementation, establish clear permitting timelines, and adopt regulations that give operators the certainty they need to invest.[1]

    •     Federal 45Q Tax Credit (26 U.S.C. § 45Q): The IRA-enhanced 45Q credit ($85/ton for permanent geologic sequestration, $60/ton for point-source capture and sequestration) makes CCUS economically viable. The Governor can ensure that California’s regulatory framework does not inadvertently disqualify California projects from 45Q eligibility.

    •     Low-Carbon Fuel Standard (17 CCR § 95480 et seq.): The LCFS provides credit value for low-carbon-intensity fuels, including renewable diesel and SAF produced at converted refineries and fuels produced with CO2-EOR. This creates a California-specific revenue stream for clean fuel investments that supplements federal incentives.

    •     CEQA Streamlining for CCUS and Clean Fuel Projects: The Governor can support legislation providing CEQA categorical exemptions or programmatic EIRs for CCUS installations at existing facilities and refinery-to-clean-fuel conversions, reducing permitting timelines while maintaining substantive environmental review.

    •     Underground Injection Control (UIC) Permitting: The EPA’s Class VI well permitting program for CO2 sequestration is administered federally. California can apply for primacy over the Class VI program (as Wyoming and North Dakota have done), giving the state direct control over CCUS permitting and enabling faster, more tailored approvals

    Tax credits are authorized under Cal. Rev. & Tax Code §§ 17053, 23600 et seq. CEQA streamlining is authorized under Pub. Resources Code § 21084. EPA Class VI primacy applications are authorized under the Safe Drinking Water Act (42 U.S.C. § 300h-1). SB 905 provides the foundational regulatory framework.

    [1] See note 23, supra. SB 905, Carbon Capture, Utilization and Storage Program (2022).

PRIORITY 5: MAINTAIN RESPONSIBLE ENVIRONMENTAL PROTECTIONS

Supporting California’s oil and gas industry does not mean abandoning environmental responsibility. I am an environmentalist who has spent decades fighting for cleaner air, cleaner water, and a healthier climate. The position is clear: California’s environmental protections, including SB 1137’s setback requirements, AB 1279’s climate goals, and the state’s opposition to offshore drilling, are non-negotiable commitments, not bargaining chips. But environmental protection and a productive energy industry are compatible when regulation is science-based, consistently enforced, and designed to achieve measurable outcomes rather than to punish an industry out of existence. My Administration will fully implement SB 1137, maintain California’s world-leading emissions standards, oppose any offshore drilling expansion, and invest in community air quality monitoring while ensuring that environmental rules are rational, predictable, and paired with pathways for compliance that keep the industry operating and investing.

  • SB 1137’s 3,200-foot setback between new wells and sensitive receptors is grounded in robust public health evidence. Independent experts concluded that proximity to oil and gas production increases cardiovascular, respiratory, and cancer risks, with impacts intensifying where well density is greater. More than 7.5 million Californians, which are disproportionately Black and Latino residents, live within one mile of active drilling sites.[1],[2] Villaraigosa’s commitment to full SB 1137 implementation is both a public health imperative and an environmental justice obligation.

    On offshore drilling, Villaraigosa has been unequivocal: "I have two words for President Trump’s proposal to open up offshore oil drilling in my state: no way." California’s coastal economy generates approximately $44 billion annually and supports 600,000 jobs. The catastrophic risk of offshore spills, demonstrated by the 1969 Santa Barbara spill and the 2015 Refugio Beach pipeline spill, is incompatible with responsible stewardship of California’s natural resources. An all-of-the-above approach means using all of California’s energy resources responsibly; it does not mean sacrificing the coast.

    California’s AB 1279 mandate for carbon neutrality by 2045 remains binding law and is achievable within the all-of-the-above framework. CARB’s 2022 Scoping Plan envisions a pathway to carbon neutrality that includes continued but declining fossil fuel production paired with CCUS, expanded renewables, and transportation electrification.[3][4] The Scoping Plan does not call for an abrupt shutdown of the oil and gas industry. It calls for a disciplined, technology-driven transition. The Villaraigosa all-of-the-above approach is entirely consistent with this trajectory.

    [1]Earthjustice. More than 7.5 million Californians live within one mile of active oil and gas drilling sites.

    [2]SB 1137 (2022), Public Resources Code §§ 3281 et seq. Establishes 3,200-foot setbacks between new wells and sensitive receptors.

    [3]CARB, "2022 Scoping Plan for Achieving Carbon Neutrality." Envisions continued but declining fossil fuel production paired with CCUS and clean alternatives.

    [4]AB 1279, California Climate Crisis Act (2022). Requires carbon neutrality by 2045 and 85% GHG reduction below 1990 levels.

  • •     SB 1137 (Pub. Resources Code §§ 3281 et seq.): A Villaraigosa Administration will fully implement and enforce SB 1137 through CalGEM rulemaking. The law’s setback requirements for new wells and enhanced pollution controls for existing wells within setback zones will be enforced without exception.[1]

    •     AB 1279 (Health & Safety Code): AB 1279’s carbon neutrality mandate is binding state law. The Governor’s role is to direct CARB and other implementing agencies to achieve the mandate through the most cost-effective, industry-compatible pathways available — including CCUS, clean fuels, and enhanced efficiency — rather than through blunt production shutdowns.[2]

    •     Coastal Zone Management Act Consistency (16 U.S.C. § 1456(c)): California will continue to exercise its federal CZMA consistency authority to challenge any offshore drilling proposals, ensuring that the state’s coastal resources are fully protected.

    •     California Coastal Act (Pub. Resources Code §§ 30000 et seq.): The Coastal Commission’s authority over coastal zone development provides an independent state-level barrier to any infrastructure that would support offshore drilling.

    •     CalGEM Environmental Monitoring (Pub. Resources Code §§ 3000 et seq.): CalGEM’s authority over well integrity, emissions monitoring, and site remediation will be fully resourced and enforced. The goal is not to weaken monitoring — it is to make monitoring predictable, science-based, and consistently applied so that responsible operators can plan accordingly.

    [1] See note 26, supra. SB 1137 (2022), Public Resources Code §§ 3281 et seq.

    [2] See note 28, supra. AB 1279, California Climate Crisis Act (2022).

PRIORITY 6: REFORM AND OVERHAUL THE CALIFORNIA AIR RESOURCES BOARD

My Administration will impose an immediate moratorium on all new CARB regulations that increase energy costs for California consumers and businesses, and will pursue a comprehensive reform and overhaul of CARB to restore transparency, accountability, and cost discipline to the state’s air quality and climate regulatory framework while continuing to advance California’s environmental goals through smarter, more efficient regulation.

My Administration will propose the CARB Accountability and Consumer Protection Act to fundamentally reform CARB’s governance and regulatory process:

(1) Immediate Regulatory Moratorium: On Day One, I will issue an executive order imposing an immediate moratorium on all new CARB regulations that increase energy costs for consumers and businesses, pending a comprehensive 180-day review of every pending and recently adopted rule. No new cost-increasing regulation may take effect until it passes a mandatory cost-benefit analysis certified by the Legislative Analyst’s Office.

(2) Mandatory Cost-Benefit Analysis: Every CARB regulation that increases consumer energy costs by more than $0.01 per gallon of gasoline or $0.001 per kilowatt-hour of electricity must be accompanied by a published, independently verified cost-benefit analysis. Regulations that fail the analysis cannot be adopted

(3) Consumer Cost Cap: Establish a statutory ceiling providing that no combination of CARB regulations may add more than $0.25 per gallon to gasoline prices above the national average. If cumulative CARB-related costs exceed the cap, the Board must suspend or modify the most recently adopted regulation until costs fall below the threshold.

(4) Governance Overhaul: Reform CARB’s Board structure to increase accountability: require Board members to hold public hearings in affected communities before adopting major rules; establish a five-year sunset review process requiring legislative reauthorization of CARB’s major programs; and create an independent Inspector General for environmental regulation to audit CARB’s cost projections and regulatory impact assessments.

IMPACT ON GAS PRICES: An immediate moratorium on new cost-increasing CARB regulations, combined with mandatory cost-benefit analysis and a statutory consumer cost cap, would halt the regulatory escalation that has added more than $0.50 per gallon to California gas prices and driven refineries out of the state.

[1] Legislative Analyst’s Office, “The 2025–26 Budget: Various California Air Resources Board Proposals,” 2025. The Governor’s 2025–26 budget allocates $1.2 billion to CARB, a 17% reduction from 2024–25 estimated expenditures. CARB employs more than 1,700 staff.

  • •     Governor’s Executive Authority — Regulatory Moratorium (Cal. Const., Art. V, § 1)

    •     Governor’s Appointment and Oversight Authority (Health & Safety Code § 39003; Gov. Code §§ 12800 et seq.)

    •     Legislative Reform Authority (Cal. Const., Art. IV)

    •     CARB Cost-Containment Mandate (Health & Safety Code § 38562(b))

    •     Federal Clean Air Act Waiver (42 U.S.C. § 7543)