Category Archives: Gasoline

Cracking Down on Refinery Emissions – all about “cat crackers”

[See also: Baykeeper notice of intent to sue Amports; Video and photos at Port of Benicia show fossil fuel polluter in the act;  Marilyn Bardet – Petcoke pollution in Benicia, photos going back to 1995]

A “cat cracker” may sound like a child’s snack, but…

Shell refinery in Martinez. Wikimedia Commons
Bay Area Monitor, League of Women Voters Bay Area, by Leslie Stewart, June-July 2021

A “cat cracker” may sound like a child’s snack, but call it by its full name — fluidized catalytic cracking unit — and it is obviously something far different. Cat crackers are a central piece of refinery equipment that turns crude oil into gasoline, diesel and aviation fuel. Regulating this specialized equipment, referred to by the acronym FCCU, recently resulted in unusually high public participation in a significant Bay Area Air Quality Management District decision.

Reducing pollution is challenging for refineries. Crude oil is a complex mixture of hydrocarbons, which is why it can be split into other products. In addition, it usually contains varying amounts of sulfur, nitrogen, oxygen and various metals, so refining it generates toxic compounds and particles which must be controlled. Refineries are subject to a multitude of regulations to prevent pollution reaching the environment and affecting the community.

FCCUs are responsible for over 50 percent of the particulate matter from refineries — over 800 tons per year — and 17% of particles 10 microns or less in diameter (PM10) from facilities with Air District permits in the region. The Air District’s Rule 6-5, regulating FCCUs in the Bay Area, was first adopted in 2015, because improved federal testing methods showed “scrubbed” FCCU emissions combining with the atmosphere when released to form more particulates than previously thought.  Particulate matter often doesn’t travel far and therefore has its greatest impact on adjacent, disadvantaged communities. Janet Hashe from Atchison Village near the Chevron refinery told the Air District Board in June, “The effects of air pollution are disproportionate on these communities and have been for decades. . .”

Under a recent state law, the Air District must require the Best Available Retrofit Control Technology for pollution sources at facilities that impact disadvantaged communities.  Rule 6-5 was revised in July in accordance with this law.  It will affect up to three of the region’s five refineries: Chevron, PBF (formerly Shell) and the currently inactive Marathon. Phillips 66 doesn’t use an FCCU at its Bay Area facility, and Valero recently installed a wet gas scrubber which should enable it to comply with the updated regulation.

Rule 6-5 now requires refineries to meet more stringent standards for emissions of sulfur dioxide and ammonia. It also sets a new limit on PM10 to reduce these emissions by over 400 tons/year. An agency staff report advised the Board that to reach that standard, local refineries will probably need to use wet gas scrubbers. This technology is used in other refineries across the country in addition to Valero.

The extensive debate over the draft rule, which started in 2019, also considered a more lenient standard that would allow twice as much PM10. Refineries might be able to meet that lower standard with less expensive electrostatic precipitators. During the multiple workshops and detailed discussion by the agency’s staff and Board subcommittees prior to two lengthy Board hearings, the two alternatives were nicknamed .10 and .20, based on the technical definition of how the PM10 output is measured, with .10 being the most stringent. They were also referred to as the ESP (electrostatic precipitator) and WGS (wet gas scrubber) alternatives.

Refinery in Martinez. Wikimedia Commons.

The more lenient .20 standard was potentially easier to achieve, and would have gone into effect by January 2023, while the adopted .10 standard won’t go into effect until January 2026. Although it will take longer to affect the region’s environmental quality, the long-term impact will be greater. Staff estimates show a yearly health benefit in reduced deaths, respiratory disease and cardiac illness of approximately $26-60 million, while the rejected alternative would have achieved only $17-38 million.

Long-term health benefits were the deciding factor for the district’s Stationary Source and Climate Impacts Committee when it voted to send the .10 alternative to the board as the recommended update to the rule. Health effects were also cited by a majority of the organizations and individuals who supported the more stringent alternative during board hearings. As Sally Tobin from Richmond noted at the six-hour June hearing, “Richmond children are hospitalized for asthma twice as often those in other parts of Contra Costa.” The Sierra Club’s Jacob Klein echoed this, saying, “We are learning more and more about the toxic impacts of particulate matter and the environmental racism associated with these emissions.”

However, the .20 limit also had substantial support. A consultant’s report on socioeconomic impacts, prepared as part of the agency’s staff report, concluded that the costs of the .10 limit might result in either employee cutbacks or an increase in gasoline prices, or both. Closures were seen as unlikely, and some public comments suggested that market factors would be the determinant in any decision to shutter a facility. However, refinery workers and their unions agreed with refinery concerns about impacts. Chad Fugate, a third-generation steamfitter, wrote, “We need these refineries to stay open and not run out of town”, while David Akeson was worried that refinery staffing decisions would affect safety, writing, “The recent Chevron fire is still fresh in my mind which was the result of repeat deferral on maintenance due to cost saving.”

District board members were also quite concerned about additional water that would be used in wet gas scrubbers, although reclaimed water and better technology could reduce that impact. Ultimately, they determined that the refinery costs and water usage were substantial unmitigated impacts that were necessary to achieve the benefits of the revised regulation.

Not surprisingly, considering the objections, the Air District has been sued by the two active refineries which will need to upgrade, PBF and Chevron. PBF is already implementing different particulate reduction measures, and maintains that it can’t afford to comply so will shut down. Chevron contests the Air District’s cost-benefit calculations. Both are asking that the rule be set aside; a decision will take several years. Nevertheless, Valero’s improved technology and the switch to refining renewable fuels at Phillips 66, and potentially at Marathon, may indicate the ultimate direction for Bay Area refineries.

Valero, other refiners spend more on U.S. clean fuel standards, look for savings through exports

Repost from Reuters
[Editor: Significant quote: “The price of credits has fuel makers like PBF Energy Inc and Valero looking to increase exports, which are not subject to the regulations, as a way to escape the costs.”  (emph. added) – RS]

Refiners on track to spend record on U.S. clean fuel standards

By Jarrett Renshaw, Aug 10, 2016 4:26pm EDT

Major refiners like Valero Energy Corp are on track to pay record amounts this year for credits to comply with U.S. renewable fuel rules, corporate filings show, a trend that hurts profits and has some looking to export more to avoid the cost.

Refiners and fuel importers are required to meet a U.S. biofuel quota of roughly 10 percent through blending products like ethanol into gasoline and diesel. If they fall short, they can buy credits generated by companies in compliance. But the cost of the credits, known as Renewable Identification Numbers (RINs), has jumped.

The rising costs have hurt a sector already struggling with huge global fuel stockpiles. The S&P 1500 index of refining and marketing companies has fallen 18 percent so far in 2016, compared with a 6.5 percent gain for the broader market.

In the first half of 2016, a collection of 10 refinery owners including Marathon Petroleum Corp, spent at least $1.1 billion buying RINs, a Reuters review of their filings showed. This puts them on track to surpass the annual record of $1.3 billion the same group spent in 2013.

Refinery executives sharply criticized the regulations during recent earnings calls, saying the burden helped bring about the weakest profits in five years.

“RINs continue to be an egregious tax on our business and have become our single largest operating expense, exceeding labor, maintenance and energy costs,” CVR Refining Chief Executive Jack Lipinski said last month.

Marathon Chief Executive Gary Heminger said on a call last month that demand for RINs are going to outpace supply and the company wanted to see renewable fuel standards eased.

Refiners without blending or retail outlets, such as Delta Air Lines and CVR, have to buy a greater percentage of RINs because they don’t create their own. Delta is part of a refiner group challenging fuel standards through the courts.

Supporters of the existing policy, including the influential corn lobby, said the regulations have produced the desired effect: more renewable fuels in the nation’s gasoline and diesel. They noted refiners can avoid the cost of RINs by investing in blending operations.

“Companies that refuse to blend more renewable fuel will end up paying a premium to other market participants, including speculators, but this is a choice,” said Emily Skor, CEO of Growth Energy, which represents ethanol producers.

ESCAPE THROUGH EXPORTS

Renewable fuel credits averaged about 78 cents apiece in the second quarter, about 25 percent above the same period a year ago, according to Oil Price Information Service data analyzed by Reuters.

Prices for the credits have rallied on more ambitious targets from U.S. regulators on the volumes of ethanol required to be blended with gasoline, traders and industry sources said.

The price of credits has fuel makers like PBF Energy Inc and Valero looking to increase exports, which are not subject to the regulations, as a way to escape the costs.

PBF Chief Executive Thomas Nimbley said on an earnings call last month that it was “very important” that they expand their refined product export operations, citing RINs as a driver.

Refiners are also lobbying to shift the responsibility of compliance from their industry to blenders and distributors who mix gasoline with ethanol for delivery to filling stations.

(Editing by Jeffrey Hodgson)

SF Chronicle Editorial: California should stick with clean-fuel rule

Repost from the San Francisco Chronicle

Editorial: California should stick with clean-fuel rule

San Francisco Chronicle, September 22, 2015

Though state lawmakers caved to the oil industry by spiking a plan to sharply reduce gasoline use, there’s another option for Sacramento in reducing climate change and promoting alternative sources to fill gas tanks. State regulators are close to extending a measure that cuts carbon levels in everyday driving fuel.

The low-carbon standard is among a batch of policies designed to cut carbon dioxide, the chief greenhouse-gas culprit blamed for rising temperatures and whipsawing weather. Extending the mandate to cut levels in gas is an essential part of state strategies to curb climate change.

Reducing the carbon level in gas has other benefits. It spurs development of alternative biofuels to wean California off its petroleum diet. The skies will be clearer and public health improved. It nudges the state toward more low-emission vehicles by showcasing the innovation needed to change gas-burning habits.

It’s not without controversy. Oil producers and Midwest ethanol producers say the plan is too flawed and complicated to work, an argument that failed in court last year. But this week, a string of major businesses — eBay, KB Home and Dignity Health among them — is backing the fuel rule. “It’s a practical, gradual and manageable transition,” said Anne Kelly, director of the employer coalition known as Business for Innovative Climate and Energy Policy.

Later this week the state Air Resources Board will consider extending the low-carbon standard, first promulgated in 2007. It’s almost certain to renew the policy, which aims to lower carbon levels by 10 percent by 2020.

The larger picture should be unmistakable. California is pushing ahead on major climate-change measures that Washington is too timid to undertake. The state is increasing renewable energy to light homes and businesses. Rules to encourage thriftier ways of heating and cooling will be strengthened. The worries about lost jobs and shuttered businesses aren’t proving true as the state’s economy gathers steam.

Changing the ingredients in gas-pump fuels should be part of this overall trend. Renewing the low-carbon standard will be good for California’s future.

Can state cut gasoline use in half in 15 years?

Repost from the CalMatters.org
[Editor:  This article also appeared in the 8/9/15 San Francisco Chronicle.  – RS]

Can state cut gasoline use in half in 15 years?  Probably not

By Kate Galbraith, August 5, 2015
Mary Serrano gets instructions on the Chevy Spark PHOTOGRAPH BY Carl Costas for CALmatters

One sunny Saturday in Stockton, Mary Serrano climbed into the driver’s seat of a bright-red, all-electric Chevrolet Spark. A retiree who normally drives a 20-year-old Toyota Camry, she was curious about the new technology on display at the local fairground.

“I feel like I’m going to outer space,” she said giddily, as a company representative prepared to explain the controls.

But after the excitement of the test drive, reality set in. The Camry, which had to be fixed after failing a smog test, will keep its place at her Stockton home. An electric car seems out of reach, despite the availability of rebates.

“For the moment, I don’t have the money to buy it,” she said by phone, a few months after the fairground event. “Maybe later in life.”

Her situation suggests that for all the allure of emissions-free vehicles, getting Californians to adopt them will take time. That in turn creates challenges for slashing gasoline and diesel use, a goal state leaders are championing as part of their battle against climate change. A bill that has passed the state Senate and awaits a vote in the Assembly seeks to halve the amount of petroleum used in motor vehicles by 2030. It will be difficult to accomplish in such a short period.

“If we’re talking about transportation petroleum use, then the goal probably isn’t possible,” said John German, a Michigan-based senior fellow with the International Council on Clean Transportation. A key problem, he said, is that people hold onto cars and trucks for a long time, an average of more than 11 years for American cars.

The bill has the backing of Gov. Jerry Brown, who earlier this year called for the state to cut petroleum use in cars and trucks by “up to 50 percent.” Senate Bill 350 contains an unequivocal 50 percent target.

“I wouldn’t set forth on this pathway if I believed that the targets were unrealistic,” said Senate leader Kevin de León, D-Los Angeles, the bill’s powerful co-author, in a recent interview.

Other parts of the legislation call for electric utilities to use 50 percent renewable energy by 2030 and for buildings to become twice as energy efficient.

“We should be careful when we set round numbers like 50-50-50. Why 50?” said Eloy Garcia, who lobbies for the Western States Petroleum Association, in testimony before an Assembly committee in July. “I know they’re nice round numbers, but we should be careful about why we’ve picked those numbers.”

The bill would take gasoline use in the state back to the 1960s, a time when California’s population was close to half of what it is today. It would not only help cut greenhouse gas emissions, a priority for the state, but also reduce the fine particles and smog-forming gases that contribute to unhealthy air above some California cities, including Los Angeles, Bakersfield, and Fresno.

“The primary driver of this target was air quality,” Stanley Young, a spokesman for the Air Resources Board, the state agency overseeing air quality and climate change policy, wrote in an e-mail.

The ARB would oversee the programs, creating a point of controversy because industry groups perceive it as high-handed, even as environmentalists cheer it on. Petroleum lobbyists and other opponents want elected legislators to plan how the goals will be met and not the appointed air board officials.

Currently, trends are moving in the wrong direction. Gasoline and diesel sales are ticking up, the sign of a surging economy. The number of miles traveled by vehicles on California highways — a crucial metric for determining whether Californians are getting out of their cars and onto bikes, sidewalks or public transportation– is also rising.

But the technology exists to halve petroleum use, as German and others point out. If everyone suddenly began driving emissions-free electric cars, such as the one Serrano tried out, California would easily meet its target. Driven by government fuel-economy and emissions standards, even cars that run on petroleum will be made of lighter, more fuel-efficient materials in the future.

These coming changes will be dramatic, even if they do not end up being enough to halve petroleum use in 15 years. German’s organization, the International Council on Clean Transportation, estimates that recent federal fuel-economy standards could cause greenhouse gas emissions from light-duty vehicles nationwide to fall 28 percent by 2030 compared to 2015.

Jeffrey Greenblatt, a scientist at the Lawrence Berkeley National Laboratory, estimates that by 2030, a number of transportation policies already in existence will enable the state to cut petroleum use by cars and trucks to about 70 percent of their 2014 level. Besides federal fuel-economy standards, these include support for public transit and a state goal of having 1.5 million emissions-free vehicles by 2025.

Another way the state is trying to cut petroleum is by encouraging the use of biofuels like ethanol or renewable diesel, provided they are formulated to be as environmentally friendly as possible. (Renewable diesel is made from fats or vegetable oil and specially refined.) At a pump in Redwood City operated by Propel Fuels, several customers opted for 85 percent ethanol rather than the ordinary gasoline available nearby, although helping the environment was not their primary motive.

“It’s cheaper,” said Donald Rainer of Menlo Park, whose flex-fuel GMC Yukon takes both gasoline and 85 percent ethanol. His main complaint was about refueling stations: “They don’t have enough of them around.”

For potential buyers of electric cars, too, costs are key. Many plug-in vehicles remain expensive, though prices have been falling and the state subsidizes them in various ways. The cars are limited in how far they can go without recharging, but that problem is diminishing as battery technology improves. Some in the auto industry wonder whether key incentives, such as allowing zero-emissions vehicles into the high-occupancy vehicle lanes on major roads, will remain in place if electric cars flood the roadways.

As improved fuel-efficiency allows Californians to use less gasoline, then prices at the pump may fall, according to Darwin Hall, professor emeritus of economics at California State University, Long Beach, depending on whether refiners adjust their capacity.

However, in the near-term, some climate policies are causing the price of gasoline to rise. The state’s cap-and-trade program, which sets limits on the amount of greenhouse gases that fuel distributors, refineries and other large polluters can emit, has increased gasoline prices by roughly a dime a gallon this year, economists estimate.

Republican lawmakers fear that SB 350 will cause job losses and economic damage. “What are my constituents going to do if we cut petroleum by 50 percent but they are still using cars that require petroleum? Will they all be required to buy new cars?” asked Sen. Jean Fuller, R-Bakersfield, during a floor debate over the bill. Her colleague, Sen. Jeff Stone, R-Temecula, described it as “coastal elitism at the worst.”

The bill is expected to have a more difficult time in the Assembly than in the Senate, where it passed the Senate with the support of all but two Democrats: Sen. Cathleen Galgiani of Stockton and Sen. Richard Roth of Riverside. The Assembly contains more moderate Democrats who have historically been friendly to the oil industry, which has launched a television ad dubbing the bill the “gas restriction act of 2015.”

The ads target a select group of lawmakers and are running on web sites in their respective districts, said Beth Miller, a spokeswoman for the industry group called California Drivers Alliance.

“It is a method of communicating to legislators about an issue we think is of concern to their constituents,” Miller said.

Sen. de León emphasized that fossil fuels were not going away. Nor, he said, would everyone need to immediately buy an electric car or hybrid. (In his official capacity, de León is chauffeured in a Chevrolet Suburban. For personal use, he leases a Chevrolet Impala and said he aspires to a hybrid.) Establishing targets, he said, is vital to encouraging California down the path toward clean energy, but the policy would not result in banning or rationing gasoline.

“If we don’t meet this goal,” de León said, “no one’s going to jail.”

Laurel Rosenhall contributed reporting.