Any time Gavin Newsom says, “Here are the facts,” brace yourself — you will not be getting the facts.

The reasons for the recent spike in California gas prices was expertly laid out by Valero executive Scott Folwarkow in reply to a September 30 letter California Energy Commission Chair David Hochschild sent to California refinery executives regarding the issue. Hochschild’s letter was filed at the Commission at 1:26 p.m. that Friday afternoon, and he demanded a reply to his questions by Monday, October 3 — giving them just one business day to answer. //

We believe the Commission experts understand that California cannot mandate a unique fuel that is not readily unavailable outside of the West Coast and then burden or eliminate California refining capacity and expect to have robust fuel supplies. Adding further costs, in the form of new taxes or regulatory constraints, will only further strain the fuel market and adversely impact refiners and ultimately those costs will pass to California consumers. //

For Valero, California is the most expensive operating environment in the country and a very hostile regulatory environment for refining. California policy makers have knowingly adopted policies with the expressed intent of eliminating the refinery sector. California requires refiners to pay very high carbon cap and trade fees and burdened gasoline with cost of the low carbon fuel standards. With the backdrop of these policies, not surprisingly, California has seen refineries completely close or shut down major units. When you shut down refinery operations, you limit the resilience of the supply chain. //

the number of operating refineries in the state has decreased dramatically over the years. In 2000 there were 23 operating refineries, compared to just 13 in 2022. In 1983, when the state’s population was 25 million, there were 40 operating refineries. In 2020 there were 40 million people in California and just 14 operating refineries.