State Senate Bill Would Loosen California Gasoline Standards
Democratic senators introduced a bill to reform California’s gasoline market amid concerns over rising fuel prices. SB 237, introduced as a “gut and amend” on June 23, 2025, would require regulators to explore alternative gasoline specifications, streamline permitting for refiners, and set a cap on biofuel credit prices.
The bill aims to stabilize the oil market and oil prices in the western United States by requiring the California Energy Commission (CEC) to cooperate with other states to “explore the development of a gasoline specification that could be used in a western region, including California, as an alternative to the California-specific specification.”
The CEC would then report to the governor and the legislature by July 1, 2026 on alternative gasoline specifications and the related costs and benefits. The bill would require the California Air Resources Board (CARB) to amend its regulations on gasoline specifications to transition to alternative specifications recommended in the report.
In addition to changes to fuel specifications, the bill would require the CEC to establish a “one stop shop” permitting process for refineries. This would cover air quality, water quality, and hazardous waste permits, approvals, or authorizations.
The bill would require CARB to lower the maximum credit price in the Low Carbon Fuel Standard program to be the average statewide credit price in effect on January 1, 2025. It would prohibit that amount from increasing annually more than the consumer price index.
The bill would also suspend the regulations that prohibit the selling of California gasoline that exceeds the applicable cap limit for Reid vapor pressure within each of specified air basins during various defined regulatory periods throughout the year.
CARB would also be required to evaluate its programs designed to reduce emissions of criteria air pollutants, including programs to replace high polluter motor vehicles, and to make any adjustments necessary to those programs to achieve the same amount of additional reductions in emissions of criteria air pollutants by October 31, 2030 as would have been achieved through the implementation of those regulations during that period.