Category Archives: Refinery emissions

CA State Senator seeks higher fines for illegal refinery emissions

Press Release from CA Senate District 3, Rep. Bill Dodd

Sen. Dodd seeks higher fines for illegal refinery emissions

Friday, February 16, 2018

SACRAMENTO – Senator Bill Dodd (D-Napa) introduced a new bill to help deter harmful emissions from oil refineries. The bill would increase fines for serious violations of emissions standards that sicken people or force shelter-in-place orders.

“There are already fines on the books for illegal refinery emissions, but the most common fine hasn’t been increased since Richard Nixon was in the White House,” said Senator Dodd. “When people are sickened by refinery emissions or forced to shelter-in-place, there should be stiffer penalties. My bill reinforces that oil companies should take proactive steps to avoid violations in the first place.”

Dodd’s bill, SB 1144, would triple existing fines for violations of emissions standards if the violations cause a health problem or impact over 25 people. Existing law doesn’t allow increased penalties for violations that injure nearby residents or for refineries with multiple violations. Currently, the maximum amount for the most common level of fines is $10,000 and hasn’t been adjusted since 1974.

Dodd’s bill would set the new fine at $30,000, and if refineries are found negligent, the amount would go up to $75,000 per day. In instances where a refinery fails to correct a known violation or intentionally violates standards, the violations would be even greater. For serial offenders with multiple serious violations within 36 months, the fines could be as much as $500,000 per day.

“Representing communities that house several refineries, I want to encourage the industry to be proactive in meeting their duty to neighboring residents,” said Senator Dodd. “This measure isn’t a silver bullet for addressing safety, but it certainly provides greater incentive to act responsibly.”

Senator Dodd’s district includes the majority of the Bay Area’s refineries. In September 2016, numerous Vallejo residents were sickened by a refinery incident that triggered over 1,500 complaints. The state’s Office of Emergency Services reported that area hospitals and medical facilities treated 120 patients for headaches, nausea, dizziness, and burning of the eyes, nose and throat. The Bay Area Air Quality Management issued a notice of violation to the refinery in Rodeo for that incident.

The funds from the fines in Dodd’s bill would be available to support more robust monitoring and enforcement. The bill is expected to come up for a committee vote next month.

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Related imageSenator Bill Dodd represents California’s 3rd Senate District, which includes all or portions of Solano, Napa, Sonoma, Yolo, Sacramento, and Contra Costa Counties. You can learn more about Senator Dodd at www.sen.ca.gov/dodd.
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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)
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Letter: Bay Area Air Board needs to step up for cleaner air

Repost from the Vallejo Times-Herald

Where our mayor, supervisor stand

By Michelle Pellegrin, 08/04/16, 4:09 PM PDT

There are 24 people in the Bay Area with the power to regulate the air we breathe. Their decisions cause or reduce asthma, cancer and other illnesses that can and have resulted in death.

This regional board has so much power to affect peoples’ lives and deaths, yet most people haven’t even heard of this agency with the unwieldy name: The Bay Area Air Quality Management District — or BAAQMD.

The 24 members of this board — which includes Vallejo Mayor Osby Davis — have a mandate to protect public health.

The neighborhoods around the refineries have suffered severe health effects from emissions. The 2012 Chevron toxic explosion and fire in Richmond sent more than 15,000 people to the hospital, which is now closed. A broad coalition of Bay Area groups would like to see refinery emissions, which have continuously gone up for the past 20 years, capped and then methods found to reduce harmful emissions. The first step in this process is an Environmental Impact Report (EIR).

On Wednesday, July 20, after four long years and several refinery incidents, the board, in a room with standing room only, was to vote on this. What appeared as a simple slam dunk became a political football between clean air advocates and Big Oil.

Bay Area refineries have been preparing to process heavier dirtier crudes, which will increase emissions and their diseases. The wave of Crude By Rail (CBR) of proposed projects, such as the Valero Benicia CBR project, are designed to facilitate the importation of extreme crudes, such volatile oil from the Bakken fields and volatile heavy crude from the Canadian Tar Sands.

BAAQMD staff, in what can only be seen as another move to interminably delay implementing modern and necessary emission standards on Bay Area refineries, supported combining the simpler refinery emission cap EIR with a complex EIR on toxic chemical emissions for up to 900 businesses.

Bay Area refinery corridor communities and their allied cities want the EIRs to be conducted separately, as the EIR on refineries can be done much more quickly than the more complex toxic chemical EIR because it requires no infrastructure changes. They want answers and relief from the constant health problems they are suffering.

And here is where our mayor stepped in to show his stripes. Davis, just recently appointed to the board, gave a critical speech supporting combining the two EIRs. Who would have thought the BAAQMD’s newest member would have such sway with the board?

Anyone with respiratory health problems or cancer can give a big round of applause to our mayor and Solano County Supervisor Jim Spering, who made the motion to combine the two EIRs. We in Solano County have the dubious distinction of having the most anti-public health, pro-corporate members on the board.

Even the Contra Costa appointees where four of the five refineries are located weren’t as instrumental as the Solano reps in pushing for the delay of this most important EIR.

Luckily, other board members did uphold their duty to the public’s health and a compromise was reached. The EIRs will be combined but if they become bogged down then they will be separated out. In addition, and a very important one from the public’s point of view, there will be citizen oversight of the process.

The irony here is that this is a false dichotomy. Big Oil will keep functioning and we need them for those cars we drive. These companies provide jobs and add to our economies. But it is no longer legitimate to trade health for jobs. It is an outmoded model and has no place in deciding public policy. It is no longer acceptable for companies to dominate local economies and the policies of the people in those communities where they are located.

Big Oil has known for years that this is the direction things are moving. A 2014 article in the San Jose Mercury News notes the refineries are already working on improving their systems in anticipation of processing the dirtier and volatile oil from outside California.

As Tom Griffith, head of the Martinez Environmental Group back in 2014 stated, “The missed opportunity here is for the oil companies to refocus their sights on the future of renewable energy.”

We should be working together to improve public health. The corporate stranglehold on such important regional boards must end. Citizens need to be attend BAAQMD board meetings and provide input on upcoming board decisions for this to happen. The next meeting is Wednesday, Sept. 21, at 9:30 a.m. at the BAAQMD headquarters at 375 Beale St. San Francisco.

And here in Vallejo we need to do the same and be more engaged. We have seen the result of complicity between politicians and corporations that excluded public input: The absurd notion of putting a cement factory in a residential area with its disastrous public health consequences. Don’t let Mayor Davis and his cronies put our community in harm’s way. Say “no” to the Orcem/VMT cement plant and don’t vote in November for any candidate who supports it!

— Michelle Pellegrin/Vallejo
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