Berkeley Law’s Center for Law, Energy and the Environment (CLEE) released a new report “Legal Grounds: Law and Policy Options to Facilitate a Phase-Out of Fossil Fuel Production in California.” The report analyzes steps California leaders could pursue on state- and privately-owned lands to achieve this reduction.

California is the seventh-largest oil-producing state in the US. The state’s crude oil production in 2018 was approximately 162 million barrels—mainly from onshore wells—down from 174 million barrels in 2017 and a recent high of 205 million barrels in 2014. Net natural gas production for 2018 was between 180 and 199 billion cubic feet—15^th in the nation (near the bottom of major gas-producing states, some of which produce trillions of cubic feet per year. These resources are responsible for billions of dollars in state and local revenue and other economic activity each year.

Fossil fuel extraction, processing, refining, and distribution are responsible for up to 10% of California’s greenhouse emissions, by some estimates (including one-quarter of state methane emissions). In addition, oil produced in the state contributes to California’s total transportation emissions.

As a result of those risks, particularly in low-income disadvantaged communities, advocates and policymakers are seeking ways to enhance regulation of, to reduce, and eventually to phase out oil and gas production in the state.

While phasing out fossil fuel extraction would seem to create immediate benefits for greenhouse gas emission reduction, experts from the economic, scientific, and policy communities have not reached agreement on the expected impacts. If California’s production decreased, long-distance oil shipments from other countries (which may have weaker local environmental and labor laws than California) could increase to compensate for some of the lost in-state supply, in particular to meet demand from California’s significant fleet of oil refineries, which serve global demand for a range of petrochemical products.

While some analysts note that reduced production in California could align with decreased consumption under existing state climate policies, limit future lock-in of fossil fuel infrastructure investments, and contribute to a partial net reduction in global consumption, the lack of conclusive data and the impact of refinery demand render a complicated picture.

—“Legal Grounds”

According to the CLEE report, among the options open to state leaders seeking to phase out the fossil fuel industries include:

• Enhancing regulatory authority over drilling by clarifying the need for the California Geologic Energy Management Division (the state’s primary oil and gas regulator) to prioritize environmental and climate impacts over production;

• Heightening scrutiny on permitting via comprehensive environmental review with mandatory, site-specific mitigation measures under the California Environmental Quality Act (CEQA);

• Instituting minimum statewide drilling setbacks of at least 2,500 feet or more from sensitive sites, such as schools, parks, and houses;

• Implementing a per-barrel or per-well severance tax and dedicate the revenue to projects that further the goal of transitioning away from fossil fuel; and

• Tasking the California Air Resources Board with devising and implementing a comprehensive plan for a phase-out of all in-state oil and gas production by a date that tracks with overall climate goals.