The local Bay Area AQMD district considers actions that will reduce supplies of aviation fuels, as the Governor remains silent.
By Ronald Stein
Ambassador for Energy & Infrastructure, Irvine, California
Desiring to make the Bay Area refineries even cleaner, at any cost to the consumer, the local Bay Area Air Quality Management District (BAAQMD) is considering amendments to Regulation 6, Rule 5 — Particulate Emissions from Refinery Fluidized Catalytic Cracking Units that will negatively impact the supply of jet fuel, which is needed to power aircraft operations in California.
The BAAQMD may not be cognizant that oil and gas are an international industry with more than 700 refineries worldwide that service the demands of the 8 billion living on earth. The California refineries are the cleanest in the world because of operating in the most environmentally regulated location on earth – the State of California.
The Bay area manages 44 percent of the oil refining capacity in California. The BAAQMD Rule 6-5, if left unchanged, will likely force the shutdown of the PBF Martinez and Chevron Richmond refineries in Northern California, as well as the closure of the many businesses that support those major refineries from the surrounding counties of Alameda, Contra Costa, Marin, Napa, San Francisco, San Mateo, Santa Clara, Solano, and Sonoma.
In 2019, those three major Northern California airports at Oakland, San Francisco and San Jose demanded 1.4 billion gallons of jet fuel to support passenger and cargo operations. The Chevron Richmond Refinery and PBF Energy Martinez supply 100 percent of the conventional jet fuel to these Bay Area airports.
Airlines are becoming much more fuel efficient, but the growth in the number of planes is causing the demand for jet fuel to remain large and growing.
With the availability of affordable jet fuel critical to aircraft operations and the sustenance of the Bay Area economy and considering that jet fuel is the second largest cost of running an airline, there should be concern from the Governor’s office about how the Rule 6-5 proposal could impact air service levels—and employment—in California.
The proposed rule would cause Bay Area refineries to shut down, as the means and cost to comply would be prohibitive to their refinery operations. If that were to occur, it would greatly constrict the Bay Area jet fuel supply, cause fuel delivery delays, reduce fuel quality and raise jet fuel prices just as demand for air travel returns and our nation emerges from the COVID-19 crisis.
With Chevron Richmond and PBF Martinez the only local refineries manufacturing jet fuel to support the military and the international airports at SFO, OAK, and SJC a reduction in the supply will contribute to dependency on unreliable foreign manufacturers, like China, the largest polluting country in the world, to meet the demands of the military and commercial transportation needs in Northern California.
Further, it leads to greater import dependence from foreign countries located hallway around the world and ultimately raise fuel prices not only in the Bay Area but also at other west coast locations and areas further inland linked by pipeline. The consequences would extend beyond the airlines to their customer base and their entire supply chain, including regional airports and the shipping public.
Through the states’ dysfunctional energy policies, California imports more electricity than any other state– currently at 32 percent from the Northwest and Southwest and dysfunctionally HOPES that other states will be able to generate enough power to meet the demands of the state. California is also the only state in the lower 48 states that is totally dependent on foreign suppliers as it has increased imported crude oil from foreign countries from 5 percent in 1992 to 58 percent today.
Governor Newsom continues to do everything possible to INCREASE the cost of electricity and fuels, that drives up (no pun intended) the cost of everything which increases the homeless population.
The BAAQMD’s local actions that will not only cause significant issues for the viability of Bay Area refineries, but it will also impact our national security and impose higher energy costs for all 40 million residents of California. While this potential threat to our national security, and the California economy lingers, Governor Newsom’s silence remains deafening!
|Ronald Stein, P.E.|
|Ambassador for Energy & Infrastructure|