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<ns0:Id>20250SB__125998AMD</ns0:Id>
<ns0:VersionNum>98</ns0:VersionNum>
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<ns0:Action>
<ns0:ActionText>INTRODUCED</ns0:ActionText>
<ns0:ActionDate>2026-02-19</ns0:ActionDate>
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<ns0:ActionText>AMENDED_SENATE</ns0:ActionText>
<ns0:ActionDate>2026-03-26</ns0:ActionDate>
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<ns0:SessionYear>2025</ns0:SessionYear>
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<ns0:AuthorText authorType="LEAD_AUTHOR">Introduced by Senators Blakespear and Gonzalez</ns0:AuthorText>
<ns0:AuthorText authorType="COAUTHOR_ORIGINATING">(Coauthor: Senator Stern)</ns0:AuthorText>
<ns0:Authors>
<ns0:Legislator>
<ns0:Contribution>LEAD_AUTHOR</ns0:Contribution>
<ns0:House>SENATE</ns0:House>
<ns0:Name>Blakespear</ns0:Name>
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<ns0:Legislator>
<ns0:Contribution>LEAD_AUTHOR</ns0:Contribution>
<ns0:House>SENATE</ns0:House>
<ns0:Name>Gonzalez</ns0:Name>
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<ns0:Legislator>
<ns0:Contribution>COAUTHOR</ns0:Contribution>
<ns0:House>SENATE</ns0:House>
<ns0:Name>Stern</ns0:Name>
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<ns0:Title> An act to add Section 25371.5 to the Public Resources Code, and to add Section 13267.6 to the Water Code, relating to refineries. </ns0:Title>
<ns0:RelatingClause>refineries</ns0:RelatingClause>
<ns0:GeneralSubject>
<ns0:Subject>Refineries: decommissioning and remediation: cost estimates.</ns0:Subject>
</ns0:GeneralSubject>
<ns0:DigestText>
<html:p>Under existing law, the State Water Resources Control Board (board) and the California regional water quality control boards prescribe waste discharge requirements in accordance with the Federal Water Pollution Control Act and the Porter-Cologne Water Quality Control Act.</html:p>
<html:p>Existing law requires the State Energy Resources Conservation and Development Commission to submit an assessment to the Governor and the Legislature that, among other things, identifies methods to ensure a reliable supply of affordable and safe transportation fuels in California.</html:p>
<html:p>The bill would require, no later than December 31, 2027, every refiner to submit to the board a draft report setting forth information concerning decommissioning and site remediation for every refinery it owns, operates, or controls, as provided. The bill would require the board, promptly upon receipt of the draft report, to initiate a 45-day public comment period
concerning the draft, and would authorize the board, at its discretion, to hold one or more public hearings concerning the draft. Unless the refiner makes a successful claim, as provided, that the report contains a trade secret, as defined, the bill would require the draft report, the board’s comments and required changes, and the final report to be promptly made available to the public on the board’s internet website.</html:p>
<html:p>The bill would require a refiner who gives notice of intent to permanently shut down, shut down to reconfigure, or sell a refinery in a transaction that may result in a refinery shutting down or reconfiguring, as provided, on or before December 31, 2027, to submit the draft report required within 30 days of that announcement. The bill would require a refiner who gives that notice after December 31, 2027, to present an update of its report within 30 days of that announcement. The bill would require a refiner who has given that notice between January 1,
2024, and the effective date of the bill, but who had not fully completed shutdown as of November 1, 2025, to present its report no later than March 31, 2027. The bill would require, on or before an unspecified date, the board to develop default technology-based guidelines for estimation of the methods, costs, and timelines associated with soil and groundwater remediation at refinery sites.</html:p>
<html:p>The bill would require the board to provide a copy of each report received pursuant to these provisions to the commission for specified purposes. The bill would require the commission to incorporate the information in its ongoing work to develop a comprehensive transportation fuels transition strategy. The bill would further require the commission, no later than one year after receiving the reports, to publish a report assessing the total decommissioning and remediation liabilities for refineries in the state, as provided.</html:p>
<html:p>Existing
constitutional provisions require that a statute that limits the right of access to the meetings of public bodies or the writings of public officials and agencies be adopted with findings demonstrating the interest protected by the limitation and the need for protecting that interest.</html:p>
<html:p>This bill would make legislative findings to that effect.</html:p>
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<ns0:DigestKey>
<ns0:VoteRequired>MAJORITY</ns0:VoteRequired>
<ns0:Appropriation>NO</ns0:Appropriation>
<ns0:FiscalCommittee>YES</ns0:FiscalCommittee>
<ns0:LocalProgram>NO</ns0:LocalProgram>
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<ns0:Preamble>The people of the State of California do enact as follows:</ns0:Preamble>
<ns0:BillSection id="id_8DFE4894-C3B1-496C-B0A5-9FB8588B7D0F">
<ns0:Num>SECTION 1.</ns0:Num>
<ns0:Content>
<html:p>The Legislature finds and declares all of the following:</html:p>
<html:p>
(a)
<html:span class="EnSpace"/>
There has been widespread recognition, in the wake of multiple recent petroleum refinery closure announcements, of the need for the state to implement a suite of policies and programs to ensure environmental, public health, labor, economic, and consumer protections for a successfully managed transportation fuels transition.
</html:p>
<html:p>
(b)
<html:span class="EnSpace"/>
Petroleum refineries in the state have been in operation for many decades, in some cases for over a century, commencing their operations in most cases long before the advent of modern environmental laws. For that reason, refinery sites tend to be heavily contaminated with hydrocarbons and
associated toxic chemicals that can pose a threat to public health both offsite and onsite, and require costly and prolonged efforts to clean up.
</html:p>
<html:p>
(c)
<html:span class="EnSpace"/>
Sea level rise associated with climate change will cause groundwater levels to rise and increase flooding, especially in coastal areas. Most refineries in the state are near the ocean or connected waters due to their logistical shipping needs. Contamination at refinery sites is of particular concern because the rising groundwater levels
may cause subsurface contaminants to migrate, increasing the risk of negative health and environmental impacts.
</html:p>
<html:p>
(d)
<html:span class="EnSpace"/>
Explicit requirements exist in other energy sectors to develop, disclose, and plan for closure obligations to
ensure orderly and well-managed decommissioning, and prevent the cost of closure from being shifted onto taxpayers. These industry-specific requirements are in place for nuclear generating facilities, wind and solar
installations, and fossil fuel extraction, for example. However, there are no requirements specifically addressing refinery closures.
</html:p>
<html:p>
(e)
<html:span class="EnSpace"/>
While refiners who are publicly traded corporations are required to report their asset retirement obligations to the United States Securities and Exchange Commission in quarterly and annual reports, applicable accounting principles have been interpreted to allow refiners to delay presenting a cost estimate for those obligations until a firm retirement date is announced. Even when refinery asset retirement obligation values are eventually reported to the commission,
the calculation of those obligations does not necessarily include the costs of postclosure site remediation.
</html:p>
<html:p>
(f)
<html:span class="EnSpace"/>
The state has a strong interest in obtaining a full understanding of the procedures and costs of safe decommissioning and postclosure site remediation
at refineries to prevent those costs from falling on taxpayers or negatively impacting the state’s budget, economy, public health, or redevelopment opportunities should the activities not be completed in a timely or adequate manner by refinery operators.
</html:p>
<html:p>
(g)
<html:span class="EnSpace"/>
Communities that are economically dependent upon refineries similarly need access to information
concerning the anticipated duration and methods of safe decommissioning and remediation in order to make necessary plans for potential site redevelopment. Having that information well in advance of a closure announcement enables refinery communities to engage in more effective long-term planning.
</html:p>
<html:p>
(h)
<html:span class="EnSpace"/>
Long-term planning, remediation, and redevelopment
of former refinery sites represents a significant challenge, but meeting that challenge can be an opportunity to support the creation of high-road jobs and new avenues of economic development.
</html:p>
<html:p>
(i)
<html:span class="EnSpace"/>
A June 27, 2025, letter from State Energy Resources Conservation and Development Commission vice chair Siva Gunda to Governor Gavin Newsom recognized the value to “identify challenges, opportunities, and strategies for the future of land affected by the transition (e.g. remediation, marketability, and value), such as Asset Retirement Obligations and standards for refinery remediation and decommissioning plans.”
</html:p>
<html:p>
(j)
<html:span class="EnSpace"/>
Senate Bill 237 (Chapter 118 of the Statutes of 2025) of the 2025–26 Regular Session directed the commission to submit an assessment to the Legislature and Governor this year that, in part, “evaluates the recommendations and strategies put forward by” that same June 27, 2025, letter.
</html:p>
<html:p>
(k)
<html:span class="EnSpace"/>
It is the intent of the Legislature to enact legislation that adequately
protects trade secrets while providing the state and local communities with a sufficient understanding of the costs, timelines, and obligations associated with refinery closures to enable them to respond effectively to possible challenges arising from the broader worldwide fossil fuel transition.
</html:p>
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</ns0:BillSection>
<ns0:BillSection id="id_1AB314DF-250D-4F52-AC7D-7CD864B96887">
<ns0:Num>SEC. 2.</ns0:Num>
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Section 25371.5 is added to the
<ns0:DocName>Public Resources Code</ns0:DocName>
, to read:
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<ns0:LawSection id="id_D5EF6AC5-F0D8-4C37-BC88-D0170B8623F1">
<ns0:Num>25371.5.</ns0:Num>
<ns0:LawSectionVersion id="id_889321AD-25E8-4014-9782-3B0E56F8096C">
<ns0:Content>
<html:p>
(a)
<html:span class="EnSpace"/>
The commission shall incorporate the information contained in the reports prepared pursuant to Section 13267.6 of the Water Code in its ongoing work to develop a comprehensive transportation fuels transition strategy.
</html:p>
<html:p>
(b)
<html:span class="EnSpace"/>
The commission shall, no later than one year after receiving the reports pursuant to subdivision (k) of Section 13267.6 of the Water Code, publish a report assessing the total decommissioning and remediation liabilities for refineries in the state. This report shall do all of the following:
</html:p>
<html:p>
(1)
<html:span class="EnSpace"/>
Protect confidential business information or other information that may be subject to protection under the Petroleum Industry Information Reporting Act (Chapter 4.5 (commencing with Section 25350)) or other applicable laws.
</html:p>
<html:p>
(2)
<html:span class="EnSpace"/>
Include consideration of the existing financial assurances that operating refineries are subject to under local, state, and federal laws and regulations.
</html:p>
<html:p>
(3)
<html:span class="EnSpace"/>
Assess the risk of existing financial assurance mechanisms being inadequate to cover decommissioning and remediation costs, and may contemplate alternative modes and mechanisms of ensuring adequate resources are available to fund and execute necessary decommissioning and remediation activities.
</html:p>
<html:p>
(4)
<html:span class="EnSpace"/>
Include coordination with state and local agencies as the commission deems
necessary and appropriate.
</html:p>
<html:p>
(c)
<html:span class="EnSpace"/>
Notwithstanding the requirements contained in the Public Contract Code or the State Contracting Manual, the commission may enter into contracts to perform the report required by subdivision (b). The contracts shall not require the review, consent, or approval of the Department of General Services or any other state department or agency.
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<ns0:Num>SEC. 3.</ns0:Num>
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Section 13267.6 is added to the
<ns0:DocName>Water Code</ns0:DocName>
, to read:
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<ns0:LawSection id="id_F5F3A34F-06D7-45A6-854D-6B19E492BDDD">
<ns0:Num>13267.6.</ns0:Num>
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<ns0:Content>
<html:p>
(a)
<html:span class="EnSpace"/>
For purposes of this section, the following definitions shall apply:
</html:p>
<html:p>
(1)
<html:span class="EnSpace"/>
“Refiner” has the same meaning as in Section 25127 of the Public Resources Code, and additionally includes persons who formerly owned, operated, or controlled the operations of one or more refineries that processed crude oil feedstocks, but now process renewable feedstocks and otherwise meet that definition.
</html:p>
<html:p>
(2)
<html:span class="EnSpace"/>
“Refinery” has the same meaning as in Section 25128 of the Public Resources Code, and additionally includes facilities that formerly processed crude oil feedstocks, but now process renewable feedstocks and otherwise meet that definition.
</html:p>
<html:p>
(3)
<html:span class="EnSpace"/>
“Trade secret” means all forms and types of financial, business, scientific, technical, economic, or engineering information, including patterns, plans, compilations, program devices, formulas, designs, prototypes, methods, techniques, processes, procedures, programs, or codes, whether
tangible or intangible, and whether or how stored, compiled, or memorialized physically, electronically, graphically, photographically, or in writing if the owner thereof has taken reasonable measures to keep that information secret; and the information derives independent economic value, actual or potential, from not being generally known to, and not being readily ascertainable through proper means by, another person who can obtain economic value from the disclosure or use of the information. The following types of information are categorically not trade secrets:
</html:p>
<html:p>
(A)
<html:span class="EnSpace"/>
Information concerning the type or extent of contamination at a refinery site.
</html:p>
<html:p>
(B)
<html:span class="EnSpace"/>
Information concerning anticipated decommissioning or remediation processes at a refinery site, and the potential or likelihood that any such methods will be deployed.
</html:p>
<html:p>
(C)
<html:span class="EnSpace"/>
Information concerning potential methods for site decommissioning and remediation.
</html:p>
<html:p>
(D)
<html:span class="EnSpace"/>
Information concerning calculation or estimation of decommissioning or remediation costs, including assumptions, variables, and methodologies used in the calculation.
</html:p>
<html:p>
(E)
<html:span class="EnSpace"/>
Information concerning sources of funds available to cover decommissioning and remediation costs.
</html:p>
<html:p>
(b)
<html:span class="EnSpace"/>
Except as provided in subdivision (i), no later than December 31, 2027, every refiner shall submit to the board a draft report setting forth information concerning decommissioning and site remediation for every refinery it owns, operates, or controls. The report shall be detailed and technically rigorous, and shall include all of the following components:
</html:p>
<html:p>
(1)
<html:span class="EnSpace"/>
A plan for
decommissioning the refinery, including, but not limited to, cleaning, removal, and disposal of physical refinery infrastructure, such as refining equipment, tanks, and pipelines. The plan shall include all of the following:
</html:p>
<html:p>
(A)
<html:span class="EnSpace"/>
A technical description of anticipated decommissioning processes.
</html:p>
<html:p>
(B)
<html:span class="EnSpace"/>
The estimated cost and duration of the decommissioning.
</html:p>
<html:p>
(C)
<html:span class="EnSpace"/>
Documentation of a source of funds available to cover the cost described in subparagraph (B).
</html:p>
<html:p>
(D)
<html:span class="EnSpace"/>
A specific description of the applicable local, state, or federal laws, regulations, or orders that impose financial assurances for completion of decommissioning or remediation on the owner or operator.
</html:p>
<html:p>
(2)
<html:span class="EnSpace"/>
A description of anticipated site
remediation measures, including, but not limited to, remediation of soil and groundwater and any needed measures to address associated offsite contamination. The description shall include all of the following:
</html:p>
<html:p>
(A)
<html:span class="EnSpace"/>
A technical description of anticipated decommissioning processes.
</html:p>
<html:p>
(B)
<html:span class="EnSpace"/>
The estimated cost and duration of remediation activities.
</html:p>
<html:p>
(C)
<html:span class="EnSpace"/>
Documentation of a source of funds available to cover the cost described in subparagraph (B).
</html:p>
<html:p>
(D)
<html:span class="EnSpace"/>
A specific description of the applicable local, state, or federal laws, regulations, or orders that impose financial assurances for completion of decommissioning or remediation on the owner or operator.
</html:p>
<html:p>
(c)
<html:span class="EnSpace"/>
The development and presentation of the draft
report required pursuant to subdivision (b) shall be governed by all of the following principles, methods, and assumptions:
</html:p>
<html:p>
(1)
<html:span class="EnSpace"/>
The draft report shall separately specify each component of decommissioning and site remediation, presenting a separate description and cost estimate associated with each component.
</html:p>
<html:p>
(2)
<html:span class="EnSpace"/>
In preparing the draft report, the refiner shall consult with all state and local regulatory agencies with jurisdiction over the decommissioning and remediation, including, but not limited to, the relevant regional board, the board, the Department of Toxic Substances Control, the relevant air quality management district or air pollution control board, and the relevant certified unified program agency, as defined in Section 25404 of the Health and Safety Code. A record of the consultation shall be included in the report.
</html:p>
<html:p>
(3)
<html:span class="EnSpace"/>
The draft report shall fully document the basis for every cost calculation, based upon, as appropriate, both site-specific estimates and the cost of reasonably comparable decommissioning and remediation at other refineries, both in state and out of state.
</html:p>
<html:p>
(4)
<html:span class="EnSpace"/>
If the information needed to accurately estimate costs is unknown, the refiner shall undertake a diligent investigation to obtain that information, including, but not limited to, making all appropriate inquiries, as defined in Part 312 (commencing with Section 312.1) of Title 40 of the Code of Federal Regulations, as it read on the date of enrollment. The report shall document all efforts made to seek and identify that information. Any missing information that cannot be obtained shall be substituted in the calculation by an approximation arrived at in consultation with regulatory agencies identified in paragraph (2) and environmental professionals, as defined in Part 312
(commencing with Section 312.1) of Title 40 of the Code of Federal Regulations, and the basis of that approximation shall be set forth in the report.
</html:p>
<html:p>
(5)
<html:span class="EnSpace"/>
For purposes of cost estimation, if the refinery’s retirement date is unknown, the estimate shall present results that assume alternative refinery closure dates of the years 2030, 2035, 2040, and 2045 for the purpose of establishing present value.
</html:p>
<html:p>
(6)
<html:span class="EnSpace"/>
The report shall incorporate and be consistent with any available default estimates and methodologies developed by the board pursuant to subdivision (j), unless a basis for deviation from the default estimate is fully documented.
</html:p>
<html:p>
(7)
<html:span class="EnSpace"/>
The report may include analysis of multiple potential decommissioning and remediation alternatives, with a reasoned explanation of the likelihood of each. The analysis shall use
probabilistic estimation methodologies where available and appropriate.
</html:p>
<html:p>
(d)
<html:span class="EnSpace"/>
Promptly upon receipt of the draft report required by subdivision (b), the board shall initiate a 45-day public comment period concerning the draft, which may be extended at the discretion of the board. The board may, at its discretion, hold one or more public hearings concerning the draft.
</html:p>
<html:p>
(e)
<html:span class="EnSpace"/>
No later than six months following submission of the draft report required by subdivision (b), the board shall review and comment on the draft report in consultation as necessary with the regulatory agencies consulted pursuant to paragraph (2) of subdivision (c), and order any changes to the draft report that the board deems necessary and advisable. The refinery shall submit the final report, incorporating all of those changes, within 60 days of receiving the board’s comments, unless the board determines that an
extension of time is required, which shall not exceed six months. The board may reject the final report and require further revisions if it determines that its ordered changes have not been sufficiently addressed.
</html:p>
<html:p>
(f)
<html:span class="EnSpace"/>
(1)
<html:span class="EnSpace"/>
Unless the refiner makes a successful claim that the report contains a trade secret, pursuant to paragraph (2), the draft report submitted pursuant to subdivision (b), the board’s comments and required changes pursuant to subdivision (d), and the final report shall promptly be made available to the public on the board’s internet website.
</html:p>
<html:p>
(2)
<html:span class="EnSpace"/>
(A)
<html:span class="EnSpace"/>
If a refiner submitting a draft or final report believes that the report contains a trade secret, the refiner shall assert the claim upon submission of the report. The claim shall specify all portions of the report concerning the assertion that is made, and provide all
information on which it relies to support that claim.
</html:p>
<html:p>
(B)
<html:span class="EnSpace"/>
The board shall immediately provide public notice on its internet website of the receipt of a claim asserted pursuant to subparagraph (A), and shall provide the refiner with a decision concerning the claim within 30 days following that receipt. That decision shall be provided to the refiner and published on the board’s internet website, with the published version redacted only as determined necessary to protect the subject trade secrets. The decision shall specify whether the board is denying the claim, granting it in part, or granting it in its entirety, shall provide all factual and legal bases for the decision, and shall set forth the names and titles or positions of each person responsible for the decision. The report shall be made available on the board’s internet website 15 days following the issuance and publication of the decision.
</html:p>
<html:p>
(C)
<html:span class="EnSpace"/>
A person may seek judicial review of a decision issued pursuant to subparagraph (B) in a court of competent jurisdiction within one year. A person opposing a trade secret claim may additionally or alternatively intervene as of right in a judicial action brought in support of that claim. The court shall allow that person to inspect and enter into evidence as appropriate all information as to which a trade secret claim has been asserted, under appropriate safeguards against disclosure. The court shall award court costs and reasonable attorney’s fees to that person should the person prevail in opposing the trade secret claim.
</html:p>
<html:p>
(g)
<html:span class="EnSpace"/>
The final and draft reports shall not be construed to limit the scope of, or appropriate measures for, decommissioning and remediation at any refinery, or to limit liability for that decommissioning and remediation or for contamination associated with a
refinery site.
</html:p>
<html:p>
(h)
<html:span class="EnSpace"/>
Refiners shall present to the board annual updates to the report submitted pursuant to subdivision (d) incorporating any new information that has become available, including, but not limited to, information concerning site conditions, potential or likely decommissioning and remediation methods, any updates to the board’s default guidelines developed pursuant to subdivision (j), and the cost of relevant services.
</html:p>
<html:p>
(i)
<html:span class="EnSpace"/>
A refiner who gives notice of intent to permanently shut down, shut down to reconfigure, or sell a refinery in a transaction that may result in a refinery shutting down or reconfiguring pursuant to subdivision (p) of Section 25354 of the Public Resources Code on or before December 31, 2027, shall submit the draft report required pursuant to subdivision (b) within 30 days of that announcement. A refiner who gives that notice after December 31, 2027,
shall present an update of its report, as described in subdivision (h), within 30 days of that announcement. A refiner who has given that notice between January 1, 2024, and January 1, 2027, but has not fully completed shutdown as of November 1, 2025, shall present its report no later than March 31, 2027.
</html:p>
<html:p>
(j)
<html:span class="EnSpace"/>
(1)
<html:span class="EnSpace"/>
On or before ____, the board shall develop default technology-based guidelines for estimation of the methods, costs, and timelines associated with soil and groundwater remediation at refinery sites. The guidelines may allow those methods, costs, and timelines to be presented as a range of values and probabilities, indicating the relevant variable factors. The default guidelines shall be made available to the public on the board’s internet website, and shall be revised from time to time as the board determines appropriate.
</html:p>
<html:p>
(2)
<html:span class="EnSpace"/>
In preparing the default
guidelines pursuant to paragraph (1), the board shall, as necessary and appropriate, consult with state and local regulatory agencies with jurisdiction over or experience with decommissioning and remediation of refineries or comparable industrial infrastructure, including, but not limited to, regional water quality control boards, the Department of Toxic Substances Control, regional air quality management districts and air quality control districts, and certified unified program agencies.
</html:p>
<html:p>
(3)
<html:span class="EnSpace"/>
The guidelines developed pursuant to paragraph (1) shall consider, without limitation, potential ranges of levels of remediation, alternative cleanup technologies, and probabilistic and other methodologies for generating cost estimates.
</html:p>
<html:p>
(k)
<html:span class="EnSpace"/>
The board shall provide a copy of each report received pursuant to this section to the State Energy Resources Conservation and Development Commission to
be considered in the report prepared pursuant to Section 25371.5 of the Public Resources Code.
</html:p>
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</ns0:BillSection>
<ns0:BillSection id="id_5B19DA13-02FE-45CF-AF23-2A8FA8FCA790">
<ns0:Num>SEC. 4.</ns0:Num>
<ns0:Content>
<html:p>The Legislature finds and declares that Section 3 of this act, which adds Section 13267.6 to the Water Code, imposes a limitation on the public’s right of access to the meetings of public bodies or the writings of public officials and agencies within the meaning of Section 3 of Article I of the California Constitution. Pursuant to that constitutional provision, the Legislature makes the following findings to demonstrate the interest protected by this limitation and the need for protecting that interest:</html:p>
<html:p>It is in the public interest to ensure that certain
information pertaining to the decommissioning and site remediation of refineries is made available to the public while balancing the protection of trade secrets. </html:p>
</ns0:Content>
</ns0:BillSection>
</ns0:Bill>
</ns0:MeasureDoc>