Author: Amy

California’s Gas Stations Must Stop Selling Gas to Gas Retailers

California's Gas Stations Must Stop Selling Gas to Gas Retailers

California’s gas-car phaseout brings turmoil to mom-and-pop gas stations.

On May 31 the California Public Utilities Commission (CPUC) ordered utilities that use natural gas to plug their gas stations to stop selling fuel to gas retailers.

The CPUC’s order affects more than two-thirds of the more than 300 California gas stations that operate as gas stations or natural-gas powered mini-marts.

It also applies to the roughly 75,000 gas stations that are operated in California as stores, filling stations, convenience, fuel-transfer stations or fill-and-gos.

The CPUC’s order is part of a wave of gas station closures that have brought economic and political turmoil to oil and gas-rich states such as Texas, Oklahoma and North Dakota. (See related story.)

The new CPUC rule means that if a retailer is licensed by the CPUC to sell natural gas and diesel fuel, it must stop selling gas to the gas stations and diesel fuel to the diesel stations. The rule also requires gas-station owners to stop selling natural gas fuel to companies that buy fuel directly from the store or gas station.

The rule goes into effect on July 1.

But the new rule brings an important twist: Retailers or their parent companies may still buy natural gas from the gas stations. They just must apply to the CPUC each time they would like to buy or sell fuel.

It will be interesting to watch how the state’s oil and gas industry, as well as the retail and wholesale gas and diesel fuel industries, react to the CPUC’s action.

The state’s gas stations are a major customer to the petroleum industry. They account for nearly 25 percent of all fuel sales in the state, and serve as an important pipeline to many refineries along the northern California coast and in the Imperial Valley.

In addition, many of the nation’s gas station employees — who do not have college degrees — and nearly all the fuel distributors who handle natural gas (which is sold in California as well as much of the U.S.) are from the oil and gas industry.

The industry is particularly sensitive to the CPUC’s rules because the companies and their employees

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