Legislation introduced in the California Senate on June 23 aims to cap the price of Low Carbon Fuel Standard credits as part of a larger effort to overhaul the state’s fuel regulations and mitigate rising gas prices. 

The bill, SB 237, was originally introduced in January. At that time, the legislation focused on residential property transfers. Lawmakers amended the bill on June 23, eliminating the language on property transfers and revamping it to focus on fuel regulations. 

 The bill would require the California Air Resources Board to amend the LCFS program to cap the price of LCFS credits at the average statewide credit price in effect on Jan. 1, 2025—roughly $75 per ton. The credit price could increase annually in line with the consumer price index.  

Other provisions of the bill would direct state agencies to explore the development of a gasoline regulation that could be used in the western region of the U.S., including California, as an alternative to the current California-specific specification; require any state regulations that affect retails transportation fuel prices to be subject to a standardized regulatory impact analysis; and create a “one stop shop” process for environmental permitting for refinery projects. 

The bill also includes an expiration date. Language included in the legislation would repeal the bill’s provisions, effective Jan. 1, 2031.

Additional information, including a full copy of the legislation, is available on the California legislature website.