Category Archives: Valero Benicia Refinery

Keeping Watch on Earth News, Pacific Gas & Electric (PGE), Valero Benicia Refinery, Western States Petroleum Association (WSPA)

Refineries asking for exemption from state power shutdowns during high fire danger – Valero Benicia lawsuit on hold

KQED, THE CALIFORNIA REPORT

California Oil Industry Sounds Alarm Over Utilities’ Power Shutoff Plans

By Ted Goldberg, Aug 20, 2019

A refinery in the Los Angeles suburb of Carson burns off flammable gases after a September 2005 power outage blacked out much of the L.A. area. (David McNew/Getty Images)

The industry group representing oil companies in California says if the state’s utilities shut off power to refineries during periods of high fire danger, the facilities could be knocked offline, resulting in major pollution releases and increased gasoline prices.

The Western States Petroleum Association asked California regulators in early May for exemptions from power shutoff plans that the state and electrical utilities have adopted to reduce the chances of power lines starting fires during extremely windy and hot conditions.

The industry group warned that an outage as short as a minute could result in refineries going off line for up to three weeks, triggering a series of ugly consequences.

“An uncontrolled shutdown of a refinery from a de-energization action would result in immediate emergency load shedding, flaring and a heightened risk of a catastrophic event,” the association wrote in a letter to the California Public Utilities Commission.

The filing has prompted an angry reaction from a leading environmental group, which says it fears the oil companies will use a power shutdown as a justification for harmful emissions.

“It’s outrageous that action to protect against wildfire risk might result in dangerous pollution,” said Clare Lakewood, a senior attorney at the Center for Biological Diversity. “Refineries shouldn’t be allowed to use this as an excuse to contaminate the air we breathe.”

When asked recently about the petroleum association’s concerns, a PG&E representative said the utility would work to restore power faster for refineries after the shutoffs.

“We are continually working to analyze our systems, refine our procedures and further assess how we can minimize the impacts of a public safety power shutoff. This includes working towards the ability to be able to prioritize the re-energization of critical infrastructure like oil refineries,” said Jeff Smith, a PG&E spokesman.

Two weeks after the association’s filing, the commission approved PG&E’s shutoff plans. Oil companies did not get the break they wanted.

But the association’s concerns have not faded. The head of the industry group continues to call on the state’s utilities to keep the power flowing to refineries even during periods of high fire danger.

“Unplanned shutdowns imposed by a utility can result in health, safety and environmental impacts,” Catherine Reheis-Boyd, the group’s president, said in a statement.

“If a utility’s actions disrupt the fuel supply chain, this could significantly impact affordable fuel costs for businesses and consumers in California,” Reheis-Boyd said. “Utilities need to make sure that they are investing adequate resources to protect critical facilities to ensure that any de-energization event is used as an absolute last resort and does not cause more harm to Californians.”

PG&E Shutoff Plan Scrutinized

The industry’s concerns were highlighted last week when state lawmakers scrutinized PG&E’s shutoff plans. State Sen. Scott Wiener. D-San Francisco, mentioned the refineries while questioning a PG&E executive.

“We saw the oil industry, and I’m not usually aligned with the oil industry, but their letter was very compelling. That’s pretty problematic for that to happen,” Wiener said during a state Senate subcommittee hearing last Wednesday.

PG&E says it recently met with the industry to discuss its concerns, but it has not signaled an intention to alter its shutoff plans.

Sumeet Singh, the PG&E vice president overseeing the company’s wildfire safety program, told the panel that the transmission system serving refineries is built with redundancy in mind.

“When you look at our transmission system, by nature, especially the 100-kilovolt and above … there’s quite a lot of reliability that’s built into it,” Singh said. That means “if you lose a line, you have another” line as a backup, he added.

Singh also suggested that the oil industries can take PG&E to court “if they fundamentally believe that the decision that we made was inaccurate, inappropriate, targeted in some way, led to some harm.”

2017 Power Outage at Valero Refinery

An oil company lawsuit against the utility would not be unprecedented. A May 2017 power failure at Valero’s Benicia plant triggered a major release of toxic sulfur dioxide and prompted emergency shelter-in-place orders.

The CPUC blamed PG&E for the outage, but declined to punish the company. Valero filed a lawsuit against the utility, seeking more than $75 million in damages. That lawsuit is currently on hold pending the outcome of PG&E’s bankruptcy proceedings.

The industry’s filing with the commission says the 2017 Valero outage proves the dangers an electricity failure poses to a refinery.

Currently, the Valero refinery is not in an area designated by PG&E as one at high risk for a public safety power shutoff. Solano County inspectors and Benicia fire officials note that the refinery gets power from two separate lines.

Terry Schmidtbauer, Solano County’s assistant director of resource management, which oversees the Benicia facility, says the likelihood of Valero losing power from a pre-emptive shutoff is low.

“That being said, we are all aware of the past events where Valero did lose all power and had to shut down rather quickly. Such an event is not impossible, even if highly unlikely,” Schmidtbauer said.

Both in 2017 and last March, when Valero shut down due to two refinery component malfunctions, the cost of gasoline in California increased.

Schmidtbauer said after the 2017 outage, county inspectors told Valero to set up a procedure by which it would rely more on fuel gas and steam to generate electricity at the plant to run the refinery if it were to lose power from PG&E.

A Valero spokeswoman did not respond to a request for comment.

Contra Costa County’s refineries — the Chevron, Shell, Phillips 66 and Marathon plants — are expected to rely more on their cogeneration facilities and reduce refining in cases of power shutoffs, according to Randy Sawyer, the county’s chief environmental health and hazardous materials officer.

“I am expecting that they will cut back on their operations so they can continue to operate somewhat on their own,” Sawyer said.

Shell’s Martinez refinery has emergency backup systems, but they are not enough to power the entire plant, according to Shell spokeswoman Ann Notarangelo.

“We do not have enough onsite generation to sustain plant operations in the event of a complete loss of power from PG&E,” Notarangelo said.

City of Benicia, Valero Benicia Refinery

After Two Major Refinery Accidents, Valero and Benicia Take Steps To Work Better Together

[Editor: In addition to coverage of the current news story, KQED’s Ted Goldberg presents here an excellent summary of Benicia/Valero issues over the last 3 years.  – R.S.]

After Two Major Refinery Accidents, Valero and Benicia Take Steps To Work Better Together

By Ted Goldberg, KQED, Jun 25, 2019

The Valero refinery in Benicia. (Craig Miller/KQED)

Benicia officials are set to consider a plan designed to keep the city and its residents better informed when the town’s largest employer, the Valero refinery, has problems.

The City Council on Tuesday plans to vote on an agreement with the company aimed at establishing a stronger air monitoring network, improving communication and giving the public more access to information about the facility.

The vote comes three months after a series of serious refinery malfunctions and in the wake of a battle over operations at the facility that spilled over into the Solano County city’s last council election.

In March the refinery sustained its second major accident in two years.

The malfunction led to a significant release of soot and smoke that prompted a brief health advisory and a more than 40-day shutdown of the facility — a closure that contributed to last spring’s increase in gasoline prices.

Under the new proposal up for a vote on Tuesday, Valero would pay $278,000 a year to fund a division chief position at the Benicia Fire Department. The person who holds that job would work as a public liaison and be the point of contact for residents who have concerns or complaints about releases from the refinery. Valero would respond to the division chief’s “reasonable requests for information.”

The proposal also calls for Valero to give risk management and safety plans to the city, provide the Fire Department with incident reports 72 hours after significant refinery malfunctions and hand over investigative reports to city officials. The city would also work to create a “single, easy” place where residents can find such reports.

The agreement also promises improved air monitoring by Valero.

Last November, the company completed installation of a set of air monitors along parts of the fence line of its refinery. But after the releases in March, the site that publishes the fence line data included a warning that all of its measurements should be considered “questionable until further notice” because several of its parts required adjustments.

City staff say Valero plans to build, install and maintain more air monitors along its northwest boundary at a cost of $1.5 million. The company is also expected to spend $460,000 on adding “community” air monitors that would be located in the city.

The measure has drawn mixed reaction from members of the City Council, which in the past has considered an industrial safety ordinance, or ISO, to give local officials more oversight of the refinery.

Benicia Mayor Elizabeth Patterson called the proposal a “good first step” but wanted assurances the new air monitors would be effective.

“We clearly need to improve our air quality and acknowledge all the sources of air pollution,” Patterson said in an email Monday.

“This looks like a decent attempt to deal with all the issues that have been presented regarding air monitors and ISOs,” said Councilman Tom Campbell.

But Campbell pointed out that there’s no timetable for the proposed actions. He said if the Fire Department’s new division chief who worked as a public liaison is aggressive, the agreement would work.

“The division chief is in our seat at the table,” he said.

Councilman Steve Young called the proposal “an improvement” over current practices, but said it should be stronger.

“There should also be warnings to the public prior to any planned instances of increased flaring, as happens during turnarounds or other major maintenance activities,” Young said.

Councilmember Christina Strawbridge, the town’s vice mayor, called the agreement “well thought out and void of politics.”

A spokeswoman for Valero declined to comment on the proposal.

The March problems were the latest in a series of incidents in which the city and company have sometimes been at odds.

In September 2016, the Benicia City Council rejected Valero’s plan to build a railroad terminal that would allow trains to deliver crude petroleum to the refinery.

In May 2017, the refinery suffered a power outage that triggered the release of more than 80,000 pounds of sulfur dioxide.

That 2017 episode led to an effort by some on the council to consider an industrial safety ordinance.

Mayor Patterson, who complained that Valero and agencies that have oversight of its refinery have failed to provide the city “a seat at the table” when it comes to information about the facility’s problems, championed the measure.

The City Council rejected the ordinance a year ago.

But debate over the regulations set the stage for last November’s hard-fought election in which Strawbridge and another council candidate, both backed by a political action committee funded by Valero and its workers’ unions, beat an environmentalist candidate backed by Patterson.

Strawbridge, who voted against Valero’s bid to build a crude-by-rail terminal, acknowledged in an email Sunday that “tension had escalated with the refinery since the city went through that process. It intensified with last year’s election.”

The March malfunctions are the source of several ongoing investigations: Valero, the air district, state workplace regulators and Solano County inspectors are still looking into the incident.

The releases exposed weaknesses in how the air in Benicia is monitored after a refinery incident.

When soot began spewing from the refinery’s stacks, for instance, the Bay Area Air Quality Management District had to send a van to Benicia because it does not run a stationary air monitoring device in the city’s residential areas.

Since then the agency has been working on finding a monitoring site, air district spokeswoman Kristine Roselius said Monday.

District officials visited six potential sites and determined that it wants to place a new air monitor at Robert Semple Elementary School, which is three-quarters of a mile southwest of the refinery, Roselius said.

Pacific Gas & Electric (PGE), Valero Benicia Refinery

Benicia Fire Chief Josh Chadwick – PGE / Valero prepared for power shut-offs

Questions on PG&E shut-offs prompt Benicia response

Vallejo Times-Herald, June 15, 2019

In response to question about PG&E’s public safety power shut-offs [PSPS’s] and their potential impact to the city of Benicia and the Valero Benicia Refinery, the Benicia Fire Department said Fire Chief Josh Chadwick has been working closely with the State Office of Emergency Services and PG& E to gather answers.

Here is what is known at this time:

• The power interruptions in Benicia on Monday and Tuesday were not related to a PG& E PSPS.

• PSPSs are designed to shut power off in either the Elevated or Extreme California Public Utilities Commission (CPUC) Fire-Threat Districts. There are no CPUC Extreme Fire- Threat Districts in Solano County. The only Elevated Fire-Threat Districts in Solano are in North Vacaville near Lake Berryessa and in the West area of Green Valley.

• Valero Refinery has two separate sources of power — one that comes in from the north and the other that comes in from the south. Their system is designed so that if one of the sources were to be shut off, the second source would be sufficient to keep the power to Valero uninterrupted.

• Per PG& E, PSPS are essentially based on upcoming weather events and should not come without warning.

• Unlike a sudden and unexpected power loss, with prior notice Valero has the ability to limit impacts through a controlled shut-down.

• Portable generators would not have the capacity to provide sufficient power to supply the refinery.

• There are numerous major commercial, industrial, and critical infrastructure facilities located throughout California which would be severely impacted by a loss of power. State OES personnel are currently working with the California Public Utilities Commission to address these facilities.

To learn more about Public Safety Power Shutoffs, visit the PG& E PSPs webpage.

Josh Chadwick, Benicia Fire Chief

For more information, contact Josh Chadwick, Fire Chief at jchadwick@ci.benicia.ca.us or (707) 7464275.

 

Air pollution, Keeping Watch on Earth News, Refinery emissions, Refinery shutdowns, Valero Benicia Refinery

Valero Says It Faces $342,000 in Penalties Over Benicia Refinery Pollution Incident

By Ted Goldberg, May 14, 2019
KQED NEWS – California Report
The Valero refinery in Benicia. (Craig Miller/KQED)

Valero says it’s facing $342,000 or more in fines from county and regional agencies after a major air pollution incident earlier this year at its Benicia refinery.

In a filing last week with the federal Securities and Exchange Commission, the company says it expects to face $242,840 in proposed penalties from the Solano County Department of Resource Management and at least another $100,000 in fines to settle a dozen notices of violation from the Bay Area Air Quality Management District.

The reported penalty amount is about 1/100th of 1% of the San Antonio, Texas-based company’s reported adjusted net profit for 2018 — $3.2 billion.

“While it is not possible to predict the outcome of the following environmental proceedings, if any one or more of them were decided against us, we believe that there would be no material effect on our financial position, results of operators, or liquidity,” the company said in its filing.

The SEC document also reported a much larger penalty, $1.3 million, that Valero believes it faces in connection with an incident in the Texas city of Corpus Christi, where contaminated backflow from a company asphalt plant contaminated the area’s water supply for several days.

A local environmentalist who has followed the Benicia refinery’s recent problems said the penalties barely amount to a drop in the bucket.

“These fines don’t mean much to a giant oil company worth tens of billions of dollars,” said Hollin Kretzmann, an Oakland-based lawyer for the Center for Biological Diversity.

“It’s likely only a matter of time before we see another incident, so the communities near these dangerous refineries deserve better protection from toxic air pollution,” Kretzmann said.

Lillian Riojas, a Valero spokeswoman, said the company would not comment beyond its public filing.

Ralph Borrmann, a spokesman for the BAAQMD, emphasized that the Valero fines were not settled yet.

The district tends to spend several years negotiating settlements with local refineries, bringing together a handful of violations into a package long after they are the subject of media coverage.

For instance, the district announced in March that Shell had agreed to pay $165,000 to settle violations at its Martinez refinery that took place in 2015 and 2016.

Solano County’s investigation into Valero’s most recent incident is ongoing, according to Terry Schmidtbauer, the county’s assistant director of resource management, who emphasized that the agency has yet to produce or negotiate any final violations in connection with Valero’s March releases.

But Schmidtbauer said it was typical for his department to discuss tentative findings and potential penalties with companies it’s investigating, talks he said would be preliminary.

Two refinery components — a processing unit called a fluid coker, which heats up and “cracks” the thickest and heaviest components of crude oil, and a flue gas scrubber, which is supposed to remove fine particles before they’re released from the facility’s smokestacks — are under scrutiny in Solano County’s probe.

They began malfunctioning on March 11, resulting in the release of sooty smoke from the refinery. The releases intensified two weeks later when the facility belched out a large amount of black soot, leading to elevated levels of particulate matter.

The smoke prompted county officials to issue a health advisory for those with respiratory problems. Refinery managers shut down the facility.

Valero’s SEC filing came as the Benicia refinery began a gradual process of restarting after being off line for more than 40 days.

The resumption of operations at the facility coincided with a slow and very small drop in gas prices, after two months of increases. On March 24, the day Valero shutdown, the average cost of a gallon of unleaded gasoline in California was $3.49, according to AAA.

On May 7, as the Benicia refinery gradually got back on-line, the the average price was $4.10. On Tuesday, it had dipped slightly to $4.07

Energy experts have said Valero’s shutdown coupled with other refinery problems in California and the high cost of crude oil globally led to the state’s recent gas price hikes, which are currently the subject of a state Energy Commission investigation.