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Media: Press Release

Bush Energy Plan is Dirty, Dangerous and Doesn't Deliver for Consumers

May 16, 2001

For Immediate Release
For More Information:
Peter Altman, Texas SEED Coalition (512) 479-7744 or (512) 750-0373
Dr. Neil Carman (512) 288-5772 or (512) 472-1767
Denny Larson, Communities for a Better Environment (925) 202-5698

Half of Nation's Refineries Out of Compliance, According to EPA Refinery Production Capacity Up Nearly 50% Since '81, says EIA data

The Bush Administration has recently advocated pursuit of expanding energy supplies by building new refineries and easing environmental regulations that govern their operation. One critical program called New Source Review has been sent to EPA Administrator Christine Whitman for review and possible overhaul.

But the Administration is ignoring the fact that expansions at refineries over the last twenty years have actually increased capacity to produce product to the highest level since 1949. Additionally, many expansions were done illegally - without obtaining the proper New Source Review permits - so that the environmental safeguards have been skirted at the plants.

"Statements by Vice-president Cheney and the Bush Administration's that we haven't built a new refinery in 20 years is totally misleading," said Denny Larson of Communities for a Better Environment. "Cheney and Bush are ignoring the fact that refineries in Texas and Louisiana have pretty much built entirely new refineries on existing sites while avoiding the New Source Review process. The impact is tons more pollution every day and a public health crisis in communities near the refineries, as well as a major contribution to global warming and global environmental crises."

The New Source Review program, established in 1977, is intended to assure that when a company expands its facilities and is going to increase its pollution, the proper environmental reviews, controls and mitigation are in place. Companies that don't go through New Source Review don't have to modernize their pollution controls and emit pollution at far higher levels that they otherwise would.

1999 Refinery Capacity at Highest Level Since 1983

Although new refineries have not been built since 1976, current refining capacity of 16.26 million barrels per day is at its highest level since 1984 and is close to the highest levels since 1949.

Additionally, production capacity has increased 50% since 1981. The EIA defines production capacity as "the maximum amount of product that can be produced from processing facilities."

The capacity increases are due to:

  • existing refineries have greatly expanded the size of their facilities, particularly in Texas and Louisiana where regulation is weak
  • refineries have intensified elements of the refining process in order to squeeze more gasoline from the bottom of barrel or more contaminated segments of crude oil
  • the addition of "oxygenates" to gasoline has allowed refiners to dilute with oxygenates every gallon of gas by 10-15% on average.

Under the Clinton Administration, the EPA started the process of cracking down on refineries and enforcing the New Source Review provisions. An extensive EPA study found that the top enforcement problems at refineries was violation of the New Source Review program and that refineries are one of the worst industries in the nation for repeated violations of environmental laws.

"Basically, refineries have been illegally expanding their plants, in some cases increasing the pollution or failing to reduce emissions they put out, with no check or oversight by state or federal agencies," said Dr. Neil Carman, Clean Air Program director for the Lone Star Chapter of the Sierra Club. "Refineries have been gearing up to process crude oil with ever higher sulfur content. Relaxing standards is simply going to smoke out and choke out the people who live near refineries."

According to the Energy Information Administration's "The U.S. Petroleum Refining and Gasoline Marketing Industry" report: "Starting in the late 1970's and continuing to the present, the U.S. majors have invested heavily in their refineries in order to utilize heavier, more sulfurous crude oils as inputs."

Most Expanded Refineries Violated New Source Review Rules
According to the EPA's, it is common for refineries that expanded to ignore the permitting process. "Although the average refinery size has increased, relatively few have applied for and obtained pre-construction and operating permits for physical expansions under the NSR/PSD program. Investigations are focusing on noncompliance with the permitting process, particularly for fluidized catalytic cracking units, the single largest air emission source at petroleum refineries." (Quote from EPA's Annual Report on Enforcement and Compliance Assurance Accomplishments in 1999").

Evidence of Pollution Problems Due to Bush's Light Hand in Enforcement:
A recent refinery investigation by a Texas environmental group illustrates the problem. Using ExxonMobil's Baytown Refinery as a case study, the Sustainable Energy and Economic Development Coalition conducted a three month long intensive review of the refinery's operations and the level of legal enforcement for violations.

The report turned up a host of problems resulting from poor management and maintenance at the plant and shoddy enforcement by the state environmental agency. The report, which studied thousands of records to form its review and conclusions, found at the ExxonMobil Baytown Refinery between 1994 and 2000:

  • Repeated and persistent accidental release (upset) and related problems
  • Failure to report problems and emissions
  • Under-estimation of problems and emissions
  • Failure to properly maintain emissions monitors
  • Possible Violations of Federal Law on Reporting and Modifications (pertaining to apparent major modifications at the plant's catalytic cracker).

The policy of environmental agencies in Texas under Bush was to let the polluters do what they want, whenever they want," said Peter Altman, Executive Director of the SEED Coalition, which produced the Baytown report. "Bush repeatedly sent polluters the message that they can break the law and get away with it. If that's going to become official US policy then communities near refineries better buy their gas masks now because the air is going to get a lot more dangerous."

Oil refineries are one of the largest sources of air, water and land pollution in the nation. With an average of almost 500,000 pounds of toxic releases per facility and over 80 million pounds industry wide annually, the impact on tens of millions of people is very real.

While refineries are found in 34 states and 2 US territories, refinery operations are concentrated in Texas and Louisiana which have over 60% of nation's capacity.

ADDITIONAL NOTES:

From "Annual Report on Enforcement and Compliance Assurance Accomplishments in 1999", US EPA

"Since 1996, the petroleum refining sector has been a priority because of the magnitude of its air pollution problems and its continued high record of significant noncompliance. While there are relatively few facilities (158 petroleum refineries), each tends to be large, handling on average over 100,000 barrels of crude oil per day. The vast majority of refinery onsite Toxics Release Inventory (TRI) releases are air emissions (>75%). In a comparison to 492 other industry categories included in EPA's AIRS database, this sector ranked first in emissions of volatile organic compounds (VOCs), second for sulfur dioxide, third in nitrogen dioxide emissions, fourth for PM 10 , and sixth for carbon monoxide. TRI releases reported averaged 502,403 pounds released per facility, and over 84 million pounds for the sector as a whole.

Sixty-five refineries are within three miles of population centers containing over 25,000 people and 37 are within three miles of centers containing 50,000 or more people.

EIA and EPA Findings:

According to the Energy Information Administration:

  • Total U.S. crude oil distillation capacity has increased substantially since 1990 (by more than 340,000 b/d) as a result of both conventional investments and debottlenecking investments.
  • This capacity expansion was achieved even with the closing of 41 refineries with more than 1.1 million b/d of crude distillation capacity (Table 3).
  • As a result, capacity per operating refinery increased by 28 percent (to 97,060 b/d) over the 1990 to 1998 period.
  • EIA suporting document link.

According to the EPA, in 1999:

  • 54% of refineries were in "significant non-compliance" (SNC) with the Clean Air Act,
  • 22% were SNC with the Clean Water Act
  • 32% were SNC with the nation's hazardous waste law, the Resource Recovery and Conservation Act (RCRA). Significant non-compliance means that the plant has committed persistent and serious violations of the Clean Air Act.
  • EPA suporting document link.

 

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