California Public Resources Code § 25355.5

(a) For purposes of this section, the following definitions apply: (1) “Gross gasoline refining margin excluding state program costs” means the amount, expressed in dollars per barrel and calculated by the commission on a monthly basis, equal to the volume-weighted average rack price of wholesale gasoline sold by a refiner in the state, less the volume-weighted fees or estimated valuations of costs embedded in all of the refiner’s wholesale gasoline sales associated with the low carbon fuel standard and the cap and trade cap-at-the-rack program, less the refiner’s volume-weighted average acquisition cost. (2) “Maximum gross gasoline refining margin” means the maximum amount of gross gasoline refining margin excluding state program costs established under subdivision (b). (3) “Volume-weighted average acquisition cost” means the combined volume-weighted average of the refiner’s volume-weighted average crude oil acquisition cost and the refiner’s volume-weighted cost of acquiring refined gasoline imported to California or received from an entity other than the refiner. (4) “Volume-weighted average rack price of wholesale gasoline” means the combined volume-weighted average of the refiner’s rack price of the branded and unbranded rack sales reported under paragraph (5) of subdivision (b) of Section 25355. (5) “Volume-weighted average crude oil acquisition cost” means the amount reported as required by paragraph (2) of subdivision (b) of Section 25355. (b) The commission may, by regulation or order at a business meeting, subject to the requirements of subdivision (f), set a maximum gross gasoline refining margin. (c) (1) If the commission sets a maximum gross gasoline refining margin under subdivision (b), it shall also establish a penalty for exceeding that maximum margin, by regulation or order at a business meeting, subject to the requirements of subdivision (f), that may be the same meeting described in subdivision (b). (2) The penalty shall be a percentage of the amount by which the refiner’s gross gasoline refining margin excluding state program costs exceeds the maximum gross gasoline refining margin, converted from dollars per barrel to dollars per gallon, multiplied by the number of gallons sold by the refiner during the calendar month for all transactions described in paragraph (6) of subdivision (b) of Section 25355. (3) Subject to subdivision (j), the penalty shall be tiered, such that the penalty percentage shall increase with the amount by which the refiner’s gross gasoline refining margin excluding state program costs exceeds the maximum gross gasoline refining margin, as follows: (A) Amounts earned by a refiner that exceed the maximum gross gasoline refining margin by less than ten cents ($0.10) per gallon shall be subject to the base penalty percentage set by the commission. (B) Amounts earned by a refiner that exceed the maximum gross gasoline refining margin by ten cents ($0.10) to twenty cents ($0.20), inclusive, per gallon shall be subject to a penalty percentage higher than the base penalty percentage. (C) Amounts earned by a refiner that exceed the maximum gross gasoline refining margin by more than twenty cents ($0.20) per gallon shall be subject to a penalty percentage higher than the penalty percentage set under subparagraph (B). (d) In establishing a maximum gross gasoline refining margin and penalty, the commission shall consider information reported under subdivision (b) of Section 25355 and any other public data and reports that it determines will assist its analysis. The commission shall also consider confidential information submitted pursuant to Sections 25354 and 25355. A refiner may submit additional information and facts for the commission to consider under an application for confidential designation pursuant to Section 25364. (e) The commission shall not set a maximum gross gasoline refining margin or accompanying penalty under subdivisions (b) and (c), respecti

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