Move over Koch Brothers, San Antonio's Valero Energy is working overtime to stop climate-change legislation and keep the future oily
Published: January 18, 2012
The "new energy economy" got a boost last week when OCI Solar Power announced a move to our sunny city to manufacture solar components and produce up to 400 megawatts of solar power for CPS Energy. "San Antonio's vision is to occupy a space right at the intersection of environmental stewardship and job creation," said Mayor Julián Castro at a press conference behind La Villita Assembly Hall.
Castro and his predecessor, Phil Hardberger, have called for a bold push into the carbon-free economy to prepare South Texas for a future where global warming finally forces caps on greenhouse gas emissions. While local leaders try to stay a step ahead of the new energy game, San Antonio's Valero Energy Corp. and Tesoro Corporation are using political spending and litigation to lead an historic battle against state and federal policies that threaten the old energy establishment.
Valero and Tesoro were vilified on the West Coast in 2010 when they spent $5 million and $2.3 million, respectively, on Proposition 23, also known as the "California Jobs Initiative." The failed ballot initiative asked voters to postpone the Golden State's greenhouse gas regulations — the first in the nation — until the unemployment rate fell from that year's 12.5 percent to 5.5 percent.
Voters rejected the measure, but Valero doesn't consider it a wasted effort. "Any time you have a chance to influence policy that affects our business, we'll take that, because there are a lot of things we can't control — like crude oil prices," Valero spokesman Bill Day told the Current.
Then-Governor Arnold Schwarzenegger was among Californians pissed off by the oil industry's meddling in their election cycle. "Valero and Tesoro are in a conspiracy. Not in a criminal conspiracy, but a cynical one about self-serving greed," Schwarzenegger told Greentech Media in September 2010. "Does anyone think in their black oil company hearts that they want to create jobs? Valero and Tesoro want to stop the movement from old energy to new energy because it means lost market share."
Prop 23 would have stalled AB 32, California's Global Warming Solutions Act, which was designed to trigger investments in electric vehicles and clean technology by pushing transportation and energy production away from fossil fuels. Voters thwarted Valero's political machinations, but the company managed to get a favorable outcome only a year later.
On December 29, 2011, a federal judge ruled that California's low-carbon fuel standard was unconstitutional because it discriminates against out-of-state fuel sources. The ruling stemmed from lawsuits brought by the ethanol industry, big agriculture, and the National Petrochemical & Refiners Association, or NPRA, where Valero CEO Bill Klesse served as chairman between 2009 and 2011.
The fuel standard would have penalized refiners for using high-carbon-density crude from Alberta's tar sands (which Valero is courting) or corn-based ethanol from the Midwest (where Valero operates 10 ethanol plants). California's Clean Air Board promises to appeal the ruling.
> Email Robert Crowe