The US Environmental Protection Agency (EPA) and the US Department of Justice today announced that Tesoro Refining and Marketing Company will pay a $27.5 million penalty for violating a 2016 consent decree ordering the company to reduce air pollution at its petroleum refinery in Martinez, CA. Simply put, Tesoro failed to limit air emissions of nitrogen oxides (NOX), a pollutant that contributes to smog.
“Tesoro did not meet the consent decree pollution limit because it did not install adequate pollution controls,” said Acting Assistant Administrator Larry Starfield for EPA’s Office of Enforcement and Compliance Assurance. “As this settlement shows, EPA will seek substantial penalties when companies delay installing appropriate pollution controls to meet environmental obligations.”
During May 2020, Tesoro suspended operations at the Martinez refinery and then announced its plan to convert the refinery to a renewable fuels plant. Today’s agreement includes requirements to limit air pollution from the future renewable fuels plant. The agreement does not prohibit Tesoro from resuming petroleum refining, but if it does so, Tesoro must install specific air pollution control technology, at an expected cost of $125 million, to ensure NOX emission limits are met.
To mitigate pollution resulting from its violation of the 2016 consent decree, Tesoro agreed to surrender most of its existing NOX emission trading credits. Tesoro also agreed to forego almost all trading credits from the shutdown of petroleum refining equipment should it convert to a renewable fuels plant. A company can receive emission credits by shutting down equipment and then apply such credits to offset emissions from new projects or trade such credits to other companies for their use. By requiring Tesoro to surrender existing credits and forego petroleum-related shutdown credits if it converts to a renewable fuels plant, the settlement prevents Tesoro and other local sources from using these credits. Thus, the settlement filed today will limit emissions in the San Francisco Bay Area, EPA said.
If Tesoro resumes petroleum refining, the settlement requirements will reduce annual air emissions by about 261 tons of NOX. If Tesoro converts the facility to a renewable fuels plant, the settlement will result in annual air emissions reductions of about 440 tons of NOX, 327 tons of sulfur dioxide, 697 tons of carbon monoxide, 69 tons of volatile organic compounds, 301 tons of fine particulate matter, and the equivalent of 1,342,025 metric tons of carbon dioxide.
The terms of a 2016 federal consent decree, which resolved Clean Air Act violations at the Martinez refinery as well as five other refineries nationwide, established emission limits for multiple pollutants including NOX. The settlement announced today will modify the 2016 settlement by including new requirements that apply whether Tesoro chooses to reopen the Martinez facility as a petroleum refinery or a renewable fuels plant.
There will be a 30-day public comment period on the modification to the 2016 settlement. Information on how to comment on the modification will be available in the Federal Register and on the Department of Justice’s website: www.justice.gov/enrd/consent-decrees.
Tesoro Refining to Pay Penalty for Consent Decree Violations
The US Environmental Protection Agency (EPA) and the US Department of Justice today announced that Tesoro Refining and Marketing Company will pay a $27.5 million penalty for violating a 2016 consent decree ordering the company to reduce air pollution at its petroleum refinery in Martinez, CA. Simply put, Tesoro failed to limit air emissions of nitrogen oxides (NOX), a pollutant that contributes to smog.
“Tesoro did not meet the consent decree pollution limit because it did not install adequate pollution controls,” said Acting Assistant Administrator Larry Starfield for EPA’s Office of Enforcement and Compliance Assurance. “As this settlement shows, EPA will seek substantial penalties when companies delay installing appropriate pollution controls to meet environmental obligations.”
During May 2020, Tesoro suspended operations at the Martinez refinery and then announced its plan to convert the refinery to a renewable fuels plant. Today’s agreement includes requirements to limit air pollution from the future renewable fuels plant. The agreement does not prohibit Tesoro from resuming petroleum refining, but if it does so, Tesoro must install specific air pollution control technology, at an expected cost of $125 million, to ensure NOX emission limits are met.
To mitigate pollution resulting from its violation of the 2016 consent decree, Tesoro agreed to surrender most of its existing NOX emission trading credits. Tesoro also agreed to forego almost all trading credits from the shutdown of petroleum refining equipment should it convert to a renewable fuels plant. A company can receive emission credits by shutting down equipment and then apply such credits to offset emissions from new projects or trade such credits to other companies for their use. By requiring Tesoro to surrender existing credits and forego petroleum-related shutdown credits if it converts to a renewable fuels plant, the settlement prevents Tesoro and other local sources from using these credits. Thus, the settlement filed today will limit emissions in the San Francisco Bay Area, EPA said.
If Tesoro resumes petroleum refining, the settlement requirements will reduce annual air emissions by about 261 tons of NOX. If Tesoro converts the facility to a renewable fuels plant, the settlement will result in annual air emissions reductions of about 440 tons of NOX, 327 tons of sulfur dioxide, 697 tons of carbon monoxide, 69 tons of volatile organic compounds, 301 tons of fine particulate matter, and the equivalent of 1,342,025 metric tons of carbon dioxide.
The terms of a 2016 federal consent decree, which resolved Clean Air Act violations at the Martinez refinery as well as five other refineries nationwide, established emission limits for multiple pollutants including NOX. The settlement announced today will modify the 2016 settlement by including new requirements that apply whether Tesoro chooses to reopen the Martinez facility as a petroleum refinery or a renewable fuels plant.
There will be a 30-day public comment period on the modification to the 2016 settlement. Information on how to comment on the modification will be available in the Federal Register and on the Department of Justice’s website: www.justice.gov/enrd/consent-decrees.