An arbitrary and unrealistic reduction of petroleum use is a major consequence of a California Chamber of Commerce-opposed job killer bill pending before lawmakers. SB 350 (de León; D-Los Angeles) has the potential to increase costs and burdens on all Californians with its mandate to cut petroleum use in half by 2030. The goal of reducing petroleum consumption by 50 percent fails to recognize the needs of average Californians.

As amended July 16, SB 350 provides broad and undefined authority to the California Air Resources Board (CARB) to adopt regulations, standards and specifications in furtherance of achieving the reduction of petroleum use in motor vehicles by 50 percent by January 1, 2030.

The bill does not specify whether CARB should adopt and implement policies that impact the demand for petroleum fuels, or whether it should adopt and implement policies that affect the supply of transportation fuels.

SB 350 fails to require CARB to give consideration to the costs or job loss associated with the mandatory reduction.

Without legislative guidance or protections against increased costs or job loss, what tools could CARB employ to meet the reduction mandate:

• Ration the use of petroleum?

• Limit driving to certain days of the week?

• Demand vehicle efficiency without available technology?

Implementation of any of those approaches will come at a high cost to the families and residents in California.

Most of California’s businesses and families rely on petroleum for their day-to-day transportation needs. Businesses rely on petroleum to transport goods and people.

SB 350 has the ability to compromise the availability of transportation fuels.

The California Energy Commission reported in its 2014 Integrated Energy Policy Report that 92 percent of all transportation fuels in California are made up of petroleum.

In opposing SB 350, the CalChamber and a coalition of employer groups ask lawmakers to imagine the upset reducing petroleum by 50 percent will have on day-to-day life activities, such as getting to and from work, taking children to school, grocery shopping, getting to the doctor, the list goes on and on.

The coalition also cites questions like: Will there be a 50 percent straight reduction in the production of petroleum in the state? What would that do to the good-paying jobs in the petroleum industry?

The petroleum industry is a major economic engine in the state and has been helping California grow for more than 100 years. In 2014, the Los Angeles County Economic Development Corporation reported that in 2012, the petroleum industry was responsible for 468,000 jobs in the state with 104,000 of those jobs located in Los Angeles County.

The industry has provided billions of tax dollars to the state and local government. If half of this is taken away, the job and economic losses to the state would be devastating.

In addition to the 50 percent reduction in petroleum, SB 350 seeks to increase the current Renewable Portfolio Standard from 33 percent to 50 percent, as well as increase energy efficiency in buildings to 50 percent. Both policies will significantly increase costs to ratepayers.

California’s energy price per kilowatt hour is among the highest in the nation and the state’s energy efficiency standards are among the strongest. Given the cost, upgrading current energy efficiency standards, while increasing the cost of energy will make California’s businesses less competitive.

As Alert went to print, news reports indicated that amendments to this bill were being negotiated. Please check the Alert app or calchamber.com for timely updates on amendments to this pending legislation.

Given the cost and economic burdens SB 350 would impose on all Californians, the CalChamber is urging policymakers to stop SB 350 from becoming law.