RICHMOND -- Looking to satisfy city and state leaders, Chevron Corp. on Monday reversed its previous position and agreed to a lower cap on greenhouse gas emissions stemming from its $1 billion Richmond refinery modernization project.
The change -- Chevron previously said it had "grave concerns" about the alternative cap proposed by the state Attorney General's Office -- is part of an effort to win approval for the hotly debated project from the City Council, which is expected to vote July 29.
Chevron also announced Monday that it would increase its community investments into local nonprofits and green jobs programs from $30 million to $60 million over the next decade if the long-sought project moves ahead.
"We have had a lot of engagement with the community, and folks wanted to see more emission reductions," said Chevron's project spokeswoman, Nicole Barber. "That's what has changed, even though this environmentally superior alternative reduces some of our operational flexibility."
In its original proposal, Chevron committed to no "net" increase in greenhouse emissions from the project. But the company is now agreeing to go further, with an absolute commitment to keep emissions flat by limiting the amount of dirtier, high-sulfur oil it will process through the upgrade.
Whether the new concessions persuade the council majority to approve the project -- which could add significant value to the refinery and the city's tax base -- remains to be seen.
Councilman Tom Butt, viewed as a potential swing vote on the polarized council, said he is pleased Chevron agreed to the alternative proposed by Attorney General Kamala Harris' office but was less impressed with the new community giving numbers. Butt said the $30 million increase comes from the company no longer having to spend money to mitigate extra greenhouse gases that were proposed in the original project.
"That $60 million is just robbing Peter to pay Paul," Butt said. "You won't see me voting (for the project) unless we get more money in community investments."
Chevron's announcement does not go as far as the city's Planning Commission recommended to the council. Among the additional conditions the commission proposed earlier this month were requirements for new piping throughout the refinery, $8 million per year until 2050 in community investments in green energy programs, and steeper reductions on a range of emissions.
But the city's staff and consultants, in a report released to the council ahead of a public hearing Tuesday, said the commission's proposed conditions "present several legal deficiencies and risks and therefore are not recommended by staff for inclusion."
Commission member Andrew Butt, the councilman's son, said Monday the commission was "under a great deal of pressure" to act quickly, because of threats from some council members to step in and vote on the issue before its scheduled August recess.
"I think there was also some degree of a feeling, at least on my part, that there was going to be an appeal anyway, and if we set the bar high, and particularly did so with a unanimous affirmative vote, it would be politically difficult for Chevron or the council to argue for a 'less safe' or 'less beneficial' set of conditions," Andrew Butt wrote in an email. "(The commission's recommendations) gives (the council) room to do some negotiating and still have a strong set of conditions that the community can be pleased with."
The main project components include replacing a 1960s hydrogen plant with more modern technology. The project would give the refinery flexibility to process crude oil blends, including higher levels of sulfur.
The new agreement would pave the way for a project that is "effectively smaller" than the original proposal and "authorizes less additional sulfur," as well as "no physical increase in greenhouse gas emissions from refinery operations relative to the base line," according to the city's staff report.
"The increase in greenhouse gas emissions from the refinery is zero" under the new proposal, Barber said.
If the council approves the project, Chevron will have to return to a Contra Costa County court that halted a previous version of the project in 2009 to get that judgment lifted before construction can begin, Barber said.
Contact Robert Rogers at 510-262-2726. Follow him at Twitter.com/sfbaynewsrogers.
What: Public hearing on Chevron Richmond modernization project
When: 6:30 p.m. Tuesday
Where: Richmond Auditorium at 403 Civic Center Plaza
Why: To hear options for approving the refinery project and provide feedback