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Refinery Communities Speak Out on Just Transition Reports

By Ann Alexander - Natural Resources Defense Council, February 9, 2021

Governor Newsom’s executive order mandating all-electric passenger cars and trucks by 2035 got quite a bit of deserved nationwide buzz last fall. What got less notice was that, buried toward the end of the order, were several mandates for action on the supply side of our fossil fuel problem—that is, California’s oil extraction and refining industry. 

We noted at the time that these mandates were not, unlike the pretty well thought out electric vehicles mandate, given much attention in the order. We expressed concern that the Governor was basically throwing a bone to people concerned about the human and environmental damage being wrought on an ongoing basis by the state’s oil production industry.

Two of those mandates, however, stood out from the beginning as critically important—both having to do with the issue of just transition for workers and communities to new economic opportunities as California phases out its oil industry. The first mandate was a directive to two California agencies—the Office of Planning and Research (OPR) and the Labor and Workforce Development Agency—to develop and implement a “Just Transition Roadmap” for the state, consistent with recommendations developed pursuant to Assembly Bill 398 in 2017. The second is a directive to two other California agencies—the Environmental Protection Agency and the Natural Resources Agency—to “expedite regulatory processes to repurpose and transition . . . oil production facilities,” and produce an “action plan” reporting on their progress, in order “[t]o support the transition away from fossil fuels.” Both reports—the Roadmap and the action plan—are required to be completed by July of this year. 

Among the missing specifics is anything about how the public and key stakeholders are to be involved in the preparation of these reports; or any clear guidelines about the required scope and depth of the reports. But what we already know is that just transition is a critically important topic for the public as the oil industry continues its slide into eventual oblivion, and merits sustained and robust attention. Not only has oil extraction been in steady decline since the mid-1980s (plunging nearly 60 percent since 1985), but California’s oil refineries are now on the brink as well—two of them announced conversions to biofuel production over the summer, while refineries around the nation and the world are increasingly becoming unprofitable and shutting down

So it is essential that the agencies ordered to produce these reports make the most of their mandate, and that the public be front and center in that process. That is the message sent by the 80 organizations who signed a letter sent today to all four agency heads asking them to conduct a robust public process for each report, and produce documents that genuinely incorporate emerging community concerns - in particular those of refinery communities, who have borne a heavy pollution burden over the years, and now face the prospect of lost jobs and a crumbling tax base. The signatories represent a broad cross-section of stakeholders, mostly from refinery communities, with a critical interest in just transition: community groups, environmental organizations, faith-based advocates, parent groups, and the business community. The City of Richmond, home to the Chevron refinery, also signed onto the letter. 

The letter calls for two things: 

First, we need a robust and inclusive public process. We know the agencies involved have the tools to do that, because some of them have done quite a good job in the past involving the public in important decisionmaking. The hat tip in the letter goes to CalEPA and the Resources Agency for creating extensive opportunities for public input into their legislatively-mandated “carbon neutrality” studies they are working on; and to the Geologic Energy Management Division (CalGEM) for reaching out to the public in connection with its anticipated public health rulemaking (now unfortunately late, but not due to the public process). In both cases, the agencies put together listening sessions targeted to specific regions around the state, and provided opportunities for members of the public to speak and ask questions, as well as to submit written comments.

Importantly, CalGEM is planning to provide a discussion draft of its rulemaking before the actual formal rulemaking process starts. It is very important that the agencies do the same here. While it is helpful for the public to be able to voice their opinions on just transition in the abstract, that by itself is insufficient. We need to see specifically what the agencies propose to put into their reports, and have an opportunity to weigh in on it.

While time is somewhat short—in project management time, July is just around the corner—that is no reason to give public participation short shrift. Although the Governor’s order requires that some manner of report be produced in July, there is absolutely nothing stopping the agencies from continuing to take public comment and refine and add to the reports.

Second, we need particular attention paid to the unique issues that attend refinery community just transitions. Much of the discussion of just transition in the past has focused on the decline of coal, and more recently on oil extraction, but refineries present different challenges. Among other things, their closure is largely unregulated. You can’t close down a power plant of any kind without permission from regulatory authorities, who also have the power to secure ratepayer funds to pay for a just transition (hence the successful just transition plan that attended the closure of California’s Diablo Canyon nuclear power plant). But refinery owners who decide their operation is unprofitable can close down pretty much overnight—which would be devastating for the heavily urban communities that have become economically dependent upon them, more so because these tend to be vulnerable communities of color. Moreover, it may also leave the communities holding the bag with a massively contaminated site—California’s refineries have been operating for decades, in some cases over a century, using hazardous materials and processes that have likely made their way into the ground.

The letter makes five specific recommendations regarding the substance of the reports, pertinent to the needs of all communities but refinery communities in particular:

  • Wage and benefit support for workers. The letter points out the need for the Roadmap to focus on how to replace lost wages and benefits, such as health insurance, for not only the refinery workers who lose their jobs, but all the indirectly employed workers who will suffer as well—like the guy at the local deli who makes the sandwiches where the workers have lunch, and the maid at the hotel where visiting contractors and company officials stay, that sort of thing. It is not enough to just talk about retraining workers, or eventually developing other industries for them to work in—they will need help right away.
  • Focus on community needs. Although the Roadmap is being drawn up at the state level, it must recognize that a solid transition on the scale necessary for a refinery community needs to be fully community-based—grounded in ideas that arise organically in the community, directed by community leaders, and reflecting the community’s diverse needs and interests. A top-down just transition strategy will not work.
  • Focus on site cleanup needs. It is hard to talk about transition and revitalization for a community that’s saddled with an enormous contaminated site in its midst. While the issue of abandoned infrastructure is most relevant to the action plan report, the Roadmap report needs to also consider the need to clean up contaminated refinery (and other) industry sites as part of helping communities find their new economic direction.
  • Close scrutiny of crude to biofuels transitions. It is important that the action plan report ask the right questions about the announced plans (and others that may emerge) to turn crude oil refineries into biofuel refineries. A poorly executed biofuels project is not a just transition solution—it risks perpetuating some of the same problems that attend crude refining, and creating new ones. Our recent comments submitted in the Contra Costa County environmental review process highlights some of the possible unintended consequences that CalEPA and the Natural Resources Agency need to take a good close look at.
  • Ensuring financial support for transition from industry. In the end, ensuring a just transition means having the funds to pay for it. And certainly in the case of refinery community transitions, those funds should come substantially from the industry itself, which has for decades burdened vulnerable communities with its presence there.

Clearly, all four agencies involved have been handed a large and critical task. The Governor’s Executive Order set the direction and the agencies are now focusing on specifics. Eighty stakeholders have made clear that they are eager to participate in crafting the required reports, and are hopeful that both the process and the outcome will reflect the enormous importance of a just transition from fossil fuels to California’s future. 

Disclaimer: The views expressed here are not the official position of the IWW (or even the IWW’s EUC) and do not necessarily represent the views of anyone but the author.

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