The latest settlement will pay for future inspections and enforcement of environmental regulations, the air quality district said.
“Ensuring that we all have clean air to breathe is the Air District’s top priority,” Jack Broadbent, the district’s executive officer, said in a written a statement. “This settlement is one way we hold Shell Oil accountable for its violations of air quality regulations and continue to safeguard clean air for all Bay Area residents.”
The refinery’s former management was found to have improperly monitored the facility’s flare pilots, which burn gas at low amounts to keep the flare system running correctly.
Once the pilots were extinguished, the refinery began emitting excess amounts of harmful pollutants, including hydrogen sulfide and sulfur dioxide, according to the air quality district.
The refinery was also flagged for not correctly sealing its storage tanks, as well as for failing to report violations and keep records up to date.
All the infractions have since been corrected, the air quality district said. An analysis earlier this year by district staff estimated that PBF’s emissions were responsible for six premature deaths each year.
PBF Energy, which acquired the Martinez refinery from Shell, warned earlier this year that the costs of cutting emissions by 70% — as required by the air quality district — will force it to shut down the refinery. Chevron, which owns a refinery in Richmond, also pushed back against the mandate.
Meanwhile, the Marathon-owned Golden Eagle Refinery in Martinez is no longer in operation. According to Marathon, the refinery is being transitioned into a facility that will produce fuels that emit less carbon than petroleum diesel.
Last week’s EPA decision adds insult to injury for our already vulnerable communities.
Perhaps you missed it. There’s a lot going on right now. But amidst all the COVID-19 headlines last week, the EPA decided that it is not “appropriate and necessary” for the government to limit emissions of mercury and other hazardous air pollutants from power plants.
This is not a roll-back of a regulation. It’s more nuanced than that. It’s a high-stakes procedural move with two important implications:
First, it scraps the legal basis for the Mercury and Air Toxics Standards (MATS) which limit hazardous air pollution from coal and oil-fired power plants. Having knocked the legal foundations out from under this important regulation, I think there’s a real risk that power plants will find ways to dial back on compliance in the future.
Second, it sets a dangerous precedent for how the benefits and costs of federal environmental regulations are assessed. The ruling removes significant health benefits from cost-benefit consideration on the grounds that they are not directly targeted by MATS.
This announcement comes at a time when the country is reeling from the global coronavirus pandemic. Protecting public health is top of mind. We’ve all become keenly aware of how actions we take can indirectly protect the health of the most vulnerable among us. With these benefits in mind, we are taking action.
Meanwhile, the EPA has decided that the indirect health benefits of pollution reductions should not be considered in regulatory cost-benefit analysis. This decision departs recklessly from standard practices for responsible public decision-making.
To understand what this means, we need to remember how we got here.
The Mercury and Air Toxics Standards limits the emissions of mercury and other hazardous air pollutants (HAPs) from power plants. To justify the rule, the EPA must demonstrate that it is appropriate and necessary. Back in 2011, the EPA supported this argument with a detailed analysis that projected big public health benefits from the power plant emissions reductions expected under the regulation. The table below, taken from the 2011 analysis, shows monetized benefits far exceeding the costs.
Last year, the Trump EPA started working to reverse the appropriate and necessary finding. The agency issued this six-page memo that re-interprets the 2011 cost-benefit analysis. There’s no new information here. The big change is that the “co-benefits” – health benefits that result indirectly from MATS compliance—have been wiped off the cost-benefit board. If we ignore these benefits (row 3 in the table above), MATS appears to fail the cost-benefit test.
There are many reasons to be concerned about this maneuver. Let me unpack three:
Co-benefits are real benefits
When power plants reduce mercury emissions, they also reduce emissions of precursors to harmful particulate matter (PM). Reducing exposure to small particulates saves lives. These benefits are referred to as “co-benefits” because they are caused by – but not directly targeted by – the regulation.
If a policy will generate big health benefits, directly or indirectly, these should be counted. Federal agencies are under Executive Order to weigh the available evidence on all significant costs and benefits in their regulatory assessments. This is also required under the EPA’s own guidelines for economic analysis.
An official decision that eliminates or reduces consideration of co-benefits sets a troubling precedent for future regulatory decisions. If this approach becomes standard, it becomes much more difficult for the EPA to justify socially beneficial regulations. Greenhouse gas emissions regulations- which can deliver significant reductions in local air pollution- are one important example.
Direct benefits estimates are outdated and incomplete
The 2011 direct benefit projections that serve as a basis for last week’s decision reflect only one health benefit from reducing mercury emissions: improvements in the IQs of children whose families catch and eat freshwater fish. This narrow focus explains why those 2011 direct benefits estimates are so small.
A decade later, we know a lot more about how power-plant mercury accumulates in commercial seafood consumed by many Americans. In addition, recent research suggests that mercury exposure could cause cardiovascular problems. If these additional health impacts were accounted for, the direct benefits of HAP reductions would look quite different. But the 2020 EPA decision is still referencing outdated and incomplete 2011 benefits numbers.
Costs are largely in the past
To comply with MATS, billions have been invested in equipment that scrubs harmful pollution out of power plant emissions. In other words, the investment costs that comprise the majority of the 2011 cost projections have already been incurred. Going forward, the costs we need to consider are the costs of operating this pollution abatement equipment. Estimates I’ve seen range from $1.80/MWh to as high as $7.92/MWh (a non-trivial increase in coal-fired electricity generation costs).
By dismissing the legal basis for the rule, MATS is left wide open to the challenge that the pollution controls are no longer legally required. If I were a coal plant operator, I might read between the lines of this decision and conclude that the EPA is not so concerned about enforcing MATS going forward.
Coal plants across the U.S. are struggling to compete with natural gas and renewables. If MATS requirements are not there to keep pollution controls switched on, plants in competitive electricity markets will have an incentive to turn this equipment off to save a few dollars/MWh. If this happens, downwind communities will pay a hefty health price.
Adding insult to injury
You would think that a high-stakes regulatory decision like this would merit an analysis update given that almost a decade has passed since the original assessment was done. The reams of data and scientific evidence that have accumulated since 2011 could provide a much more accurate evaluation of the rule’s benefits and costs, in addition to a more informed basis for re-evaluating the appropriate and necessary finding. Instead, this EPA has dusted off a stale 2011 analysis, deleted the co-benefits, and declared the rule unnecessary and/or inappropriate.
The timing of this decision feels particularly callous because the communities that have historically been most exposed to high levels of air pollution are the ones being hit hardest by the COVID-19 crisis. This recent study suggests that even small increases in long-term exposure to particulate matter significantly increase COVID-19 fatality risk.
The Trump administration assures us it is putting “safety first” during this COVID-19 epidemic. But in the background, Trump appointees have been doing quite the opposite with decision after decision after decision. This MATS reversal has the potential to do real damage. But if there is good news to be found in this story, it’s that it will take time to play out. One more reason to work hard to course correct in November.
Keep up with Energy Institute blogs, research, and events on Twitter @energyathaas
Press Release – Solano County Valero Flue Scrubber Report
Benicia, CA (April 1, 2019) – The City of Benicia has received an Incident Response Inspection Report from the Solano County Department of Resource Management related to the flue gas scrubber incident at Valero Benicia Refinery. A copy of the report is included with this press release.
On March 24, 2019 at approximately 7:00 a.m., the City of Benicia issued an advisory
notice for all residents with respiratory issues to stay inside due to particulate matter released by the Valero Benicia Refinery. The City actively monitored the air quality and incident response activities, and provided information to the public via media outlets including social media and Alert Solano.
Benicia Fire Department personnel continues to work closely with Solano County Environmental Health to monitor operations and potential impacts to the community.
State workplace regulators, the region’s local air quality district and Solano County health officials are trying to find out why a problem at Valero’s Benicia refinery suddenly worsened over the weekend, leading to a release of petroleum coke dust that prompted fire officials to urge those with respiratory problems to stay indoors.
The incident led to a partial shutdown at the facility and represents the worst malfunction at the plant since a power outage caused a major pollution incident in 2017.
The releases of elevated levels of particulate matter led several residents to complain of breathing problems and prompted Benicia’s mayor to call on Valero to pay the city back for its work dealing with the emergency. The partial refinery shutdown is also expected to lead to a spike in higher gasoline prices throughout the state.
Mayor Elizabeth Patterson said she’s gotten a flood of phone calls and emails from residents wanting to know why it took so long for Valero to suspend refinery operations.
“There’s a lack of understanding about how coke particulates could be continuously emitted throughout a couple of weeks,” Patterson said. “There’s not a lot of information that’s readily available to the public.”
California’s Division of Occupational Safety and Health began a probe into Valero on Monday, the day after the company began the gradual shutdown of a significant portion of the refinery, according to agency spokesman Frank Polizzi.
Cal/OSHA becomes the latest government agency to look into the breakdown of a key piece of equipment inside the refinery that went down two weeks ago. The Bay Area Air Quality Management District and Solano County officials have launched probes as well.
Refinery Problems Started Two Weeks Ago
On March 11, the facility’s flue gas scrubber began malfunctioning. That meant the facility’s smokestacks began belching a sooty plume of petroleum coke dust — minute carbon particles that are a byproduct of the oil refining process.
The initial problem prompted the Bay Area Air Quality Management District to issue eight notices of violation against Valero.
The air district and Solano County health officials said during the following days that the flue gas scrubber had been fixed and the coke dust releases were intermittent and gradually coming to an end.
But the black smoke returned on Saturday. On Sunday, fire officials detected high levels of fine particulate matter, known as PM10, around the refinery and issued a health advisory urging people with respiratory issues to stay indoors.
“What we were seeing was dark gray, almost black smoke coming from the flue gas scrubber unit,” Benicia Fire Chief Josh Chadwick said Monday.
PM10 is particulate matter 10 micrometers or less in diameter — larger than PM2.5 many became familiar with during last November’s Camp Fire, when smoke from the huge Butte County blaze prompted health advisories throughout much of Northern California.
Like PM2.5, the larger particulate matter is regulated by the Environmental Protection Agency.
EPA spokeswoman Soledad Calvino said the agency would not comment on ongoing or potential investigations.
The agency has said that once inhaled, petroleum coke dust can affect the heart and lungs and cause serious health effects.
“The additional concern is that this is more toxic than the standard stuff you’d find in the atmosphere,” said Anthony Wexler, director of the Air Quality Research Center at UC Davis. “It’s probably similar in toxicity to diesel exhaust, which is a known carcinogen because it’s sooty in nature.”
On Sunday morning the wind in the Benicia area was blowing east to west at about 6 to 12 mph, according to meteorologist Jan Null.
That meant the coke dust was being blown toward residential neighborhoods, said Chadwick.
“That was one of the big concerns I had,” Chadwick said. “We had a wind shift … that really turned it back toward the city.”
Several Residents Complain of Breathing Problems
Chadwick said the Benicia Fire Department received two 911 calls for respiratory complaints. One of the calls was for one person who was transported to John Muir Medical Center in Concord. The other was for two people who told paramedics who showed up they didn’t need to be hospitalized.
The wind on Sunday also sent the coke dust toward parts of Contra Costa County, according to air district spokesman Ralph Borrmann. The agency received several complaints from people in Benicia and a few in Rodeo, Borrmann said.
Fire crews have been conducting air readings since Sunday morning and the levels of particulate are back to normal, Chadwick said.
Air district officials are expected to release the results of their testing later this week.
It’s unclear why the flue gas scrubber began malfunctioning again.
Terry Schmidtbauer, Solano County’s assistant director of resource management, said his department’s investigation is focused on the scrubber unit, other refinery components that interact with the device and if refinery workers made a mistake in operating the unit.
It’s also uncertain how long it will take to shut down the affected parts of the refinery and how long that closure will last.
“I am not sure how long Valero intends to have the affected portion shut down,” Schmidtbauer said in an email.
Lillian Riojas, a Valero spokeswoman, did not answer questions about how long the shutdown should last.
On Sunday the company issued a statement about the refinery problem.
“There may be a visible plume and flaring as part of the shutdown,” Valero’s statement said.
Mayor Renews Call for More Refinery Regulations
Mayor Patterson has been calling for more regulation of Valero’s facility ever since the May 5, 2017, refinery incident — a push that so far has failed to result in action.
The City Council rejected her proposal to develop an industrial safety ordinance, similar to one in Contra Costa County, that provides more information to town officials about refinery problems.
The latest incident has prompted her to renew her call for action.
“We definitely need an industrial safety ordinance with the fees to cover the costs that it’s costing the city,” Patterson said. “When we are responding to these things, that means we’re not doing something else.”
Patterson said she planned to bring up the issue of compensation at a City Council session this Saturday.
A Bay Area environmental group critical of the oil industry and the agencies regulating it said the episode should raise concern about operations at other facilities.
“This is the latest sign that Bay Area refineries and our air quality officials can’t safely cope with current workloads, let alone the increased volume of oil processing planned by the industry,” said Hollin Kretzmann, an Oakland-based lawyer for the Center for Biological Diversity.