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The Californians Who Knew How to Stop the Gas Price Spike

The Californians Who Knew How to Stop the Gas Price Spike

California repeatedly warned about spiking gas prices, fragile supply. But fixes never came from Sacramento

By The Associated Press | March 28, 2014

This is an archived article that was published on in 2013, and information in the story may be outdated. It is provided only for personal research purposes and may not be reprinted.

BOULDER, Colo. — On a day nearly three years ago when California’s oil-rich neighbors suddenly began talking about a price spike — and perhaps a supply crunch — state officials and energy companies alike were focused on two other subjects.

One was to figure out what was making the price jump. The other was what to do about it.

A year earlier, when California’s energy and transportation markets crashed after a pipeline explosion in San Bruno that killed eight people, no one knew what was happening. But by now, everyone knows.

That explosion — which may have had some other causes — added at least $10 to the price of a gallon of gas, forcing the state’s transportation network to reduce demand, a phenomenon known as a “gas price spike.”

But no state official knew how to turn off that supply-driven price hike, or how to make California’s system more resilient to the kind of collapse that has hit the world energy markets in recent years.

“We felt like, ‘We have to make a system decision for the entire industry,’ ” said Steven Stoft, who was the California Energy Commission’s director until he left in May. “There was no discussion at the time about how to change the structure or structure of the market.”

And, he said, when the California Department of Public Health, which regulates oil and gas, asked him a year later to run the department, he was astonished.

“I couldn’t believe this was coming from them,” Stoft said. “I thought California was supposed to be independent. I thought this was how California would be doing things.”

California’s energy picture is now more stable, and that is a big help to the state in its fight against global warming, yet the state’s energy outlook looks even more fragile this week after gasoline prices soared to a record for this time of year and gasoline inventories are

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