(VitalNews.org) – California Governor Gavin Newsome has returned to state lawmakers with a new deal to take aim at “Big Oil” after his first proposal failed. The Democratic governor, along with state Sen. Nancy Skinner, announced they modified a proposal that would punish fossil fuel companies for what the politicians say are exorbitant prices. California has been facing years of historically high energy prices and a creaking electrical grid.
The new proposal, unsurprisingly, would create a new government office dedicated to monitoring what the governor believes are acts of price-gouging.
Newsom’s statement about the proposal took the tone of a hero fighting for beleaguered energy consumers. It paints oil refineries and other fossil fuel energy producers as operating “in the shadows” and promises to make these companies “play by the rules.”
The new oversight system would be the most effective in the country, Newsome said, and would “root out price gouging.”
The proposed legislation would create a new division inside the California Energy Commission, which oversees energy policy statewide. The new division would have the authority to examine refinery data, subpoena other information from companies, and directly refer potential cases to the state attorney general.
Newsom and Democrats say they’re pleased with the legislation, but it is a weaker version of what Newsom wanted. His earlier proposal in December 2022 would have directly punished energy companies with fines if the state decided their profit margins were too high. How the state proposes to determine how much profit is “too much,” is unclear.
Even Democrats and experts sympathetic to the idea of tighter regulations on energy prices balked at Newsom’s earlier bill. They worried it could lead to even higher prices for consumers.
University of California business professor Michael Mische criticized Newsom’s latest move, saying it will reduce energy supplies, shut down some producers, and scuttle energy sector jobs — all while increasing the price consumers pay.
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