Two bay area refineries green lighted for the switch to biofuel
Contra Costa County approved the biofuel conversion of two petroleum refineries that will be among the highest capacity facilities in the world in a special meeting on May 3rd. The Phillips 66 (P66) refinery in Rodeo will produce up to 67,000 barrels per day of renewable diesel and the Marathon refinery in Martinez will produce 48,000 barrels per day once the conversion projects are completed.
The refinery conversions are driven by subsidies from California’s Low Carbon Fuel Standard (LCFS) which requires producers of conventional fuels to purchase credits generated by producers of fuels with a lower carbon intensity (CI). “That really means that traditional gasoline and diesel is supporting investments in low carbon fuels,” said Richard Corey the Executive Officer of California Air Resources Board (CARB) which administers the LCFS program.
The Contra Costa County Board of Supervisors voted unanimously to certify the final environmental impact reports (FEIR) and approve both projects with some conditions added.
The two projects had been approved by the county planning commission but a lengthy list of community groups and environmental organizations appealed the decision to the County Board of Supervisors. Appeals for the P66 project were also filed by an individual community member and a Crocket community organization.
Many of the organizations that filed the appeal had also signed on to detailed comments on the Draft Environmental Impact Reports (DEIR) for both projects. The organizations and individuals that participated in the group appeal included, The Asian Pacific Environmental Network, Natural Resources Defense Council, BiofuelWatch, 350.org Contra Costa, Communities for a Better Environment, the Center for Biological Diversity, three Richmond City Council members, the Sunflower Alliance, San Francisco Baykeeper and several more.
“[W]e are really here to talk about burning food to be fuel,” said Connie Cho of Communities for a Better Environment in her opening remarks for the appellants. Cho urged the council to consider current impacts that the pandemic and the war in Ukraine have had on food prices exacerbating the international hunger crisis. She then explained that recycled vegetable oil which is listed among the project feedstocks has uses in secondary markets in the food system. And because the supply of recycled oils is limited, much of the feedstocks for the projects would come from non-recycled soy and corn oils.
Cho pointed to recent studies indicating that the demand for soy as feedstock for biofuels has led to deforestation because palm oil is often used in food products to replace soy oils that are processed for fuel. She went on to say that soy feedstocks have been removed from subsidy programs in Belgium and they are being reconsidered in the EU because of this connection to deforestation and their failure to reliably produce a net climate benefit.
The planning commission staff and proponents for both projects highlighted the emissions and greenhouse gas reductions calculated in environmental reviews of the projects. According to the environmental reviews both the P66 Rodeo project and the Martinez project will significantly reduce greenhouse gas emissions as well as particulate emissions. Many labor unions and building trades associations have issued statements of support for the projects which could employ as many as 29,000 workers on a temporary basis at various times throughout the construction phases.
The appellants brought up a wide range of concerns with both projects relating to safety, potential releases of toxic materials, odor management, land use change due to increased demand for corn and soy feedstocks as well as the price increases that could affect international food security. The group also claimed that both projects had used an incorrect baseline to calculate emissions reductions.
In the case of the Martinez refinery the appeal claimed that because the refinery had been closed since April of 2020 all emissions from the new project should be considered as an increase in emissions from production levels during the two most recent years of non-operation. The FEIR used a 5-year average of production at the refinery demonstrating a decrease in emissions for the new project.
The Contra Costa County planning commission staff claimed that there is ample legal precedent for historical conditions to be considered under the California Environmental Quality Act (CEQA). Supervisor John Gioia noted that Martinez refinery has all the necessary permits in place to continue processing petroleum based fuels.
The appeal claimed that the P66 project baseline was also incorrect because current permits along with the closure of the Santa Maria Refinery indicate that the Rodeo refinery is facing a declining supply of crude feedstock. The Santa Maria Refinery in San Luis Obispo County supports the supply of crude to the Rodeo facility via pipeline and without this supply of crude the refinery production levels would be tied to the limited crude oil feedstocks available through the refinery’s marine terminals. The appeal claimed that the historic baseline used in the FEIR did not take into account evidence of a declining supply of crude. The appellant representatives argued that CEQA allows for the consideration of future conditions but the council rejected this point.
Corey, who spoke about both projects in connection with the LCFS program explained that California is committed to electrification and zero emission vehicles in transportation. However, he said, on the pathway to that goal some sectors that are difficult to decarbonize, such as aviation and trucking, can reduce emissions by burning low carbon fuels in place of conventional fuel.
“If you look at that 2035 date for cars and light duty vehicles you are at 100% zero emission vehicle sales…in 2035 30% of your on road fleet is still internal combustion engines and that is the category that is easier to deal with,” said Corey.
According to Corey, renewable diesel generally produces 30% less particulate matter (PM) emissions from the tailpipe of combustion vehicles.
CARB Life Cycle Analysis (LCA) studies provide a carbon intensity range for various feedstocks and production methods for renewable diesel. Tallow and soy used to produce renewable diesel can result in up to 80% reduction in carbon dioxide emissions. However, one pathway used as an example in the Marathon project EIR demonstrated a 43% reduction of CO2 using soy as a feedstock. LCA includes emissions from production of a feedstock such as corn or soy, emissions related to fertilizer and increases in cropland as well as emissions from the refining process, transportation of feedstocks and finished fuels.
The two appeals filed individually were also addressed by the board. A local community member Charles Davidson claimed that the renewable feedstocks require more hydrogen in the cracking process. Davidson said that the additional processing of hydrogen with the use of natural gas eliminates any carbon savings benefit. Supervisor John Gioa responded by saying that even if the refining process emits more greenhouse gasses the entire life cycle emissions of growing and transporting the soy is less than that of petroleum based fuels.
The second individual appeal was on behalf of a Crocket based community organization that requested the town, which is also a neighbor to the Rodeo refinery, be included in talks regarding a community benefit package. The council expressed trust in Supervisor Federal D. Glover, in whose district both projects are located, to assure that all stakeholders are included in community benefit discussions.
Before approval the Board of Supervisors added throughput limits on both projects setting the production capacity at the planned levels in the FEIRs. The board also added a prohibition on the use of palm oil as a feedstock although it is unlikely that this feedstock would be used because it has a high carbon intensity and does not qualify for the LCFS subsidy. Lastly the board included a condition that the refineries must make a good faith effort to source organic waste feedstocks locally.
Both of the refineries were operating before county zoning laws were put into place. “This is the first time that we will have an overarching land use permit for these facilities,” said Contra Costa County Senior Planner Gary Kupp. As part of the new permits county staff included requirements for clean up and re-use of the project sites when they are decommissioned. The responsibility for clean up could have fallen on the county prior to the new permit.
In his final comments on the Marathon project Supervisor Gioia expressed how important it is to move to zero emission vehicles in California but he said “The reality is, whether we like it or not, there is going to be a need for liquid fuels between now and the 2040s.”
