You are browsing the archive for Energy.

Was State Senator Rubio (CA) Auditioning For Job at Chevron?

2:53 pm in Uncategorized by Consumer Watchdog


The power of the petroleum industry in California may be unparalleled in the states. Its lobbying machine is stupendously successful. For instance, California remains the only significant oil producer that does not tax oil extracted in the state. It has very weak–perhaps the weakest–regulation of oil and gas extraction, particularly hydraulic fracturing of deep deposits, known as “fracking.” State environmental laws are under constant attack.

State Sen. Michael Rubio, a Central Valley Democrat elected to his seat in 2010, was in an ideal spot to show whose side he was on in these fights.

Rubio, who resigned from the Senate Feb. 22 to work for Chevron as its chief California lobbyist, was chair of the Senate Environmental Quality Committee, which oversees oil industry environmental issues. In 2011-12, he was a key Democrat on the Senate’s energy committee.

His most recent official action was an inaction: He was scheduled to co-chair his committee’s hearing on fracking with Sen. Fran Pavley. The hearing took place, airing widespread frustration with the weakness and loopholes of current and proposed state regulation of fracking. Rubio, however, was a no-show.

It’s obvious now that on Feb. 12 he was getting ready to jump ship to Chevron, and likely in no mood to hear citizen fears about water pollution, spoiled land and even fracking-induced earthquakes. But Rubio did, in his short tenure, leave a record that Chevron was surely tracking with admiration.

In hindisght, his biggest moment in the spotlight would have been his months-long campaigning on behalf of a corporate effort to weaken the California Environmental Quality Act. The changes would have particularly benefited the oil, energy and property development industries. The proposals didn’t become law, but they’re not dead yet. Rubio will just be working them from the other side of the fence.

In May 2012, Rubio also cast the deciding “no” vote against a bill (SB 1054) by Sen. Pavley that would have merely required oil companies to notify residents and businesses nearby in advance of fracking activities. The bill, vociferously opposed by the Western States Petroleum Assn. and other oil lobbyists, failed. Industry opponents of the bill recognized Rubio for his role in leading the opposition that killed a bill with wide public support.

Rubio also supported, and may have encouraged, the governor’s firing of two state energy regulators in 2011 after oil lobby complaints about their tightening of oversight.

(Oil and energy weren’t the only supporters he was courting. Rubio also championed the profits of Blue Cross over the pocketbooks of customers. He withheld his vote in 2011 from a measure that would have allowed the state insurance commissioner to reject health insurance rate increases that could not be justified. In the state Legislature, an abstention from voting is effectively a “no” vote, but with no accountability. It’s the coward’s way out. )

Judy Dugan

Chevron certainly knows what it’s getting with this new top lobbyist.

Rubio stated that he was leaving his elected post two years early to spend more time with his family, including a disabled child. No matter how much that weighed in his decision, the fact remains that his status as a state senator (however briefly) greatly inreased his value to Chevron. His pay will grow by multples. Because there is no law against such a quick trip through the revolving door–from overseeing an industry to lobbying for it–Rubio could be schmoozing his fellow legislators right now, and spreading money to their campaigns. His constituents, meanwhile, are stuck with no representation until a special election that’s perhaps months away.

Posted by Judy Dugan, former research director for Consumer Watchdog, a nonpartisan, nonprofit organization dedicated to providing an effective voice for taxpayers and consumers in an era when special interests dominate public discourse, government and politics. Visit us on Facebook and Twitter.

Evergreen Is Never Clean: Time For Hazardous Waste Regulators to Act

1:57 pm in Uncategorized by Consumer Watchdog

Evergreen Oil Refinery

If a tree falls in a forest and no one is around to hear it, does it make a sound? If a hazardous vapor spews out of an industrial plant, but no regulator reacts, was there ever a leak?

Well, on July 6, Evergreen Oil workers decided not to stick around to find out. Some 70 workers walked off the job the minute they heard there was a leak at the hazardous waste and used motor oil recycling plant. It was a “self-evacuation,” according to the Alameda County Fire Department. One worker did go to a medical facility, was evaluated for exposure, and later released. Everybody else came back sometime after the leak was contained in the mid-morning.

But no worries, said the Alameda Fire Department. The leak was harmless to people’s health. And Newark City officials patted Evergreen’s plant manager on the back for, get this, reporting the leak properly and quickly. Sadly, that could be a first.

Here’s what we know about Evergreen Oil up in Newark, California in the East Bay area: It handles hazardous waste materials like anti-freeze and other toxic waste. And it’s the only oil refinery recycling used motor oil here in the West. It employs a couple of hundred workers, generates about $36 million in sales each year, and has been operating since the mid 1980s.

Now, recycling used motor oil is a great idea. We want to live sustainably. And we need to do something about the underbelly of toxic waste in California from chemicals used to make computers to the engine oil you left behind at your last oil change.

The problem is that Evergreen Oil’s operations aren’t safe. It’s a serial toxic polluter with a very long record. The point isn’t just this particular leak on July 6, which was quickly contained. The point is this leak is part of a much bigger problem involving Evergreen’s record of operations, and its ability to negotiate its way out any real accountability.

Since opening in 1986, nearly every agency with the ability to fine Evergreen has done so. Evergreen’s been cited for dangerous levels of cyanide, arsenic, and other harmful chemicals in its wastewater, for violating public health standards, for the toxic gases it has allowed to emanate from the site and that have, on occasion, reached the nostrils of school children, for poisonous fumes and odors at the site, for an explosion, and for illegally handling, treating and disposing of hazardous waste.
Read the rest of this entry →

Contradictory Information on Hazardous NorCal Waste Plant Accident Means It’s Time to Close It Down

6:06 pm in Uncategorized by Consumer Watchdog

Timidity and Fragmented Oversight of Evergreen Oil Plant Hamper Enforcement, Endanger Community, Says Group

Shut the Refinery Down

New information obtained from emergency responders shows that a July 6th high-temperature leak at the Evergreen Oil re-refining plant in Newark, California involved a hazardous industrial chemical, not just recycled motor oil, as initially reported. Consumer Watchdog called on the chief regulator of the facility to shut the plant down. In a letter sent Tuesday to Debbie Raphael, Director of the Department of Toxic Substances Control (DTSC), the consumer organization asked her to convene fragmented regulatory agencies and respond strongly to the latest in a long series of safety violations and accidents at the plant in Newark, CA.

According to Consumer Watchdog, regulators are unclear about who is the lead regulator overseeing the facility, with DTSC’s own enforcers acknowledging they are uncertain of the department’s authority over the whole plant, which processes used motor oil. They were also not aware of what actions other agencies might be taking.

“The DTSC, which should be the leader in any event involving this serial safety violator, seems almost to be looking for reasons not to get involved,” said Consumer Watchdog advocate Liza Tucker. “This is an opportunity for the new director to show strong leadership and creativity in a department that appears to have faltered for years.”

The letter sent Tuesday said in part:

“Such holes in oversight must be filled for the safety of all Californians. Rather than parsing its ability to regulate this portion and not that portion of a toxic waste plant, the DTSC should put itself at the forefront of saying that this is one dangerous accident too many.…. “

“On its face, the idea that the DTSC would have authority to regulate one part of a hazardous waste plant but not another is absurd, particularly when the release on July 6 was hazardous enough to warrant an evacuation, whether the dangerous leak was in the re-refinery area of the plant or not. “

Download the entire letter here with a timeline of events

On July 6, a pipe leak spewed a hazardous vapor filled with “heat transfer” chemicals used in re-refining. That triggered an emergency evacuation of the facility. The company and Newark police warned the surrounding community, including a nearby elementary school, to expect a wave of “strong chemical odors” from the leak.

See link to CAL-EMA public record of initial report here.

The DTSC said that the leak on July 6 took place in a portion of Evergreen’s facility where recycled oil is processed. A DTSC official stated that the department’s hands are tied because the permit issued to Evergreen does not cover the part of the facility where the leak occurred. According to DTSC, once the waste oil has been partially treated, it is no longer considered a “hazard.” But the heat transfer liquid used to control refining temperatures is hazardous, according to the Alameda County Health and Environmental Agency.

“Evergreen’s long history of repeated and serious safety violations has to come to an end,” said Tucker. “The department has to take control of the situation, including coordination with other regulators, for the sake of the community surrounding the Evergreen plant, and to set an example for all Californians.”

The July 6 accident markeds the latest in a string of problems at the plant that includes a burst pipe and major fire in March 2011 and repeated citations by the DTSC for safety violations and carelessness. Yet the DTSC has let the company off the hook with consent decrees and hand-slap fines for at least a dozen years, said Consumer Watchdog. The group said now is the opportune time for new leadership at the DTSC to rethink its approach to regulating hazardous waste and recycling facilities.

Click here for more.

Read Consumer Watchdog’s July 16 letter to DTSC Director Debbie Raphael here.

Also read Consumer Watchdog’s April 9 letter to the Senate Judiciary Committee.

Urging Regulators to Shut Down Refiner After Leak That Endangered Northern California Community

2:38 pm in Uncategorized by Consumer Watchdog

State Department of toxic Substances Control Must Send “Strong Message” to Evergreen Oil Re-Refiner Over Repeated Safety Lapses, Accidents


Consumer Watchdog called on the Director of the California Department of Toxic Substances Control, Debbie Raphael, to indefinitely close the Evergreen Oil waste-oil re-refinery in Newark, Ca. in a letter sent today. On July 6, a pipe leak spewed “superheated oil” and triggered an emergency evacuation of the facility. The company and Newark police warned the surrounding community, including a nearby elementary school, to expect a wave of “strong odors” from the leak.

Read today’s letter to Raphael here

Consumer Watchdog cited repeated problems at the facility as an example of DTSC’s failure to take tough action against toxic industries that continue to operate after repeated safety violations near homes and schools in testimony and a letter presented at Debbie Raphael’s State Senate confirmation hearings in April.

The confirmation letter said several companies, including Evergreen, “appear to have manipulated or ignored the DTSC and other agencies to the detriment of concerned and frustrated local residents.”

The accident marks the latest in a string of problems at the plant that re-refines used motor oil, including a burst pipe and major fire in March 2011 and repeated citations by the DTSC for safety violations and carelessness.

Read the rest of this entry →

Senator, Energy Investigators Slam Refinery Price Manipulation

7:22 pm in Uncategorized by Consumer Watchdog


The energy investigators who nailed Enron for energy price manipulation that nearly bankrupted California just took aim at oil refining giants including Chevron and BP. May the refiners’ gasoline-price schemes now come crashing down in an Enron-style heap.

We’ve known for years that California and West Coast refiners find endless ways to shut down some of their gasoline production, cutting supplies and jacking up pump prices. They actually make more money from making and selling less gasoline. It explains why West Coast drivers are stuck paying $4-plus a gallon while pump prices take a dive in the rest of the country. Now a credible study and a U.S. Senator have reached the same conclusion–and trying to put some muscle on the oil industry.

Washington State Sen. Maria Cantwell is probably the best-informed on the petroleum industry of all federal legislators, at least among those not joined at the hip with Exxon. She is calling on the the Federal Trade Commission to investigate six major refiners–Alon, Chevron, ConocoPhillips, Shell, Tesoro and BP. It’s a smart move, because the oil lobby has a stranglehold on Congress and most state legislatures. President Obama has tried at least twice to reduce the industry’s billions of dollars in taxpayer subsidies, and gotten nowhere.

Here’s the gist of the story by McClatchy news service’s Kevin Hall:

Read the rest of this entry →

Why Are Gasoline Prices Staying High?

7:14 pm in Uncategorized by Consumer Watchdog


The old adage about gasoline prices, “up like a rocket, down like a feather,” has never been so true. The price of crude oil in recent days has been down near $80 a barrel, translating to about $1.92 a gallon. But the national average price for a gallon of regular gasoline, according to AAA, is stuck at $3.63 a gallon, what it was a month ago.

Economists are cheering the drop in the price of oil, but it won’t do much to help consumers unless the price of fuel comes down as well.

Attached is the AAA national price chart for Wednesday. Note that the gap between the price of oil and the price of gasoline is about $1.80–around twice the recent usual, and the gap has been growing since the beginning of July. Because stations these days turn over their inventory fast, unlike in the old days of mom-and-pop stations, there’s no visible excuse for the retail prices.

I’m often on the side of gasoline retailers when it comes to pricing, because they get squeezed by refiners and price-setting by their suppliers. But wholesale gasoline prices are also dropping sharply, so it looks like the branded retail chains are reaping a bonanza even as drivers suffer as much as ever from a trashed economy.
Posted by Judy Dugan, research director for Consumer Watchdog, a nonpartisan, nonprofit organization dedicated to providing an effective voice for taxpayers and consumers in an era when special interests dominate public discourse, government and politics. Visit us on Facebook and Twitter.

Oil Will Grease a Debt-Limit Recession

2:39 pm in Uncategorized by Consumer Watchdog


If the U.S. ends the coming weekend without national debt limit deal, it won’t just be bond defaults sending the nation back into a deep, ugly recession. A hint came Tuesday as the price of oil rose a little, nearing $100 a barrel once again even as stocks did a mini-tank, with the Dow down 91 points.

So who’s still grinning as most of us curse the absolutists in Congress who see “balance” as treason? Yep, oil companies.

BP jumped back to a $5.6 billion quarterly profit Tuesday after a $17 billion loss a year ago, post-spill. Smaller Occidental Oil was up 71% over last year’s 2nd quarter, to $1.8 billion. And analysts think the party will continue.

From Reuters:

Analysts said it would likely be the oil industry’s biggest second quarter since 2008, when oil prices hit record highs. “We expect almost all the oil and gas companies we cover to report higher earnings than in [2009 and 2010]. The earnings improvements from a year ago reflect higher oil prices of 32% for West Texas Intermediate crude and and 50% for Brent North Sea crude,” said Fadel Gheit, senior energy analyst for Oppenheimer and Co.

Getting oil speculation under control has slipped far from the top of the agenda in Washington. But no matter how the debt crisis turns out, federal regulators have to recognize that the economy can’t ever really recover while Main Street pays for the energy binges on Wall Street and in Houston.

The oil price increase came as the value of the dollar dropped, and speculators hunted for a place to put money coming out of stocks. If the U.S. economy crashed after a debt default, oil would crash partway, because a dead U.S. economy means so much less gasoline and oil consumed. But in a lesser scenario, oil could just keep creeping up, until speculative energy and food prices really do crash the consumer economy again.

No matter what happens, oil will rise long before consumers get out from under their job and other losses–just as happened in the recent recession, putting a drag on any hope of quick recovery.

What to watch? The price of gasoline. Economists see $4.00 gasoline in the U.S. as the tipping point where drivers start feeling pinched and cut back on other expenses. Gasoline is now hovering around a national average of $3.70 a gallon, up 15 cents from a month ago. That’s not much of a cushion; it’s already more than job-hunters can afford. Too bad no one in the Capitol has lost his job and can feel the pain firsthand.
Posted by Judy Dugan, research director for Consumer Watchdog, a nonpartisan, nonprofit organization dedicated to providing an effective voice for taxpayers and consumers in an era when special interests dominate public discourse, government and politics. Visit us on Facebook and Twitter.