Newsom is trying to have it both ways when it comes to the petroleum industry. Pick a lane, Gov.
While Gov. Gavin Newsom is doubling down on electric vehicles, some of the Democrats running to succeed him are calling for keeping California refineries open until the state is truly ready to transition to renewable power.
Which ain't now.
It's a remarkable shift for Democrats, who usually tout their fealty to protecting the environment when running statewide in California. But the specter of high gas prices with two major refineries set to close in the next year, plus the potential job losses resulting from those closures, is causing some Democrats to adjust. It also is a response to Republicans making inroads with blue-collar voters who used to be a core part of the Democratic Party until the party stopped responding to their needs.
All eyes were on a key Washington vs. Sacramento battle last week after the Senate killed California's signature climate change policy — mandating that all new cars sold be electric by 2035 — and Newsom responded by announcing the state would sue to keep California's emission standards in place.
Newsom said the GOP-controlled Senate's move not only would increase pollution in a state where 20% of the new car sales are EVs, but also would cede dominance in the electric vehicle market to China.
'We won't stand by as Trump Republicans make America smoggy again — undoing work that goes back to the days of Richard Nixon and Ronald Reagan — all while ceding our economic future to China,' Newsom said Thursday. 'We're going to fight this unconstitutional attack on California in court.'
But some of the Democrats vying to replace Newsom in 2026, when he is termed out of office, are saying something more fossil-fuel friendly — at least when they appeared at a candidate forum this month in Sacramento sponsored by the California Labor Federation and the State Building Trades Council. Their members work at petroleum refineries, which provide some of the last blue-collar jobs that pay enough to enable workers to buy a home in the Bay Area.
But those jobs are disappearing. The Phillips 66 Los Angeles refinery is scheduled to close by the end of this year, stranding 600 employees and 300 contractors. The Valero Benicia refinery, which has 400 permanent employees and hundreds of contractors, is scheduled to close by 2026, six months after air quality regulators issue the refinery a record $82 million penalty for its toxic emissions. Combined, the two refineries produce 21% of the gasoline that California produces.
And that is only the start of an anticipated wave of closures. Newsom realizes this wave is coming. Last month, he wrote a letter to California Energy Commission Vice Chair Siva Gupta urging the commission to 'redouble the State's efforts to work closely with refiners on short- and long-term planning,' to seek ways to 'reinforce the State's openness to a collaborative relationship (with refiners),' and to reassure that 'refiners can profitably operate in California.'
Pick a lane, Gov. It sounds like Newsom, who continues to shape-shift in the sunset of his tenure, is trying to have it both ways when it comes to the petroleum industry.
As University of Southern California business professor Michael Mische noted, 'There's a perversion to this logic as only a few years ago the Governor boldly declared that the oil companies and refiners had been 'ripping' off consumers for decades. … Now he's concerned with their profits.'
There is little doubt where the industry is headed, at least in California. Or more accurately, out of California.
In January, the San Francisco Bay Area Refinery Transition Analysis — written by a coalition of union and environmental justice advocates with the UC Berkeley Labor Center — anticipated 'that a 65% to 92% reduction in (refinery) production capacity is likely by 2045. By that time, the region may have one large or two small oil refineries to serve the remaining market, or no oil refineries at all, depending on the pace of transition.' There are 3,000 direct and 15,000 indirect jobs in Contra Costa County related to the refineries there. Cities in the county receive $136 million in direct taxes from the refining industry and $836 million in indirect tax revenue.
Then there's the potential spike in gas prices — which will hit nearly all of us. Californians consume 13.1 million gallons of gasoline a day, according to Mische. In a study he released this month, Mische predicted that gas prices in California will spike to $6.43 a gallon by the end of this year, and to $8.43 a gallon by the end of 2026 — soaring at the same time as the 2026 governor's race will be peaking. As you noticed during your Memorial Day weekend travels, the average price of a gallon of gas is $4.86 in California ($5.13 in San Francisco), according to AAA. East of the Left Coast it's $3.19.
So at the candidates forum hosted and moderated by organized labor, seven of the announced governor candidates were asked several loaded questions, including: 'As governor, would you be pragmatic to stop targeting California's oil and gas industry in ways that jeopardize union jobs and force us to rely on dirty or imported energy?'
Not surprisingly in a hotel conference room filled with top local labor leaders from across California, all of them agreed. But most tried to walk a fine line between appeasing their labor hosts and not offending environmentalists whose support they need to win in the nation's most naturally beautiful state. Key to note is that all stressed the need and/or desire to keep fossil fuel industries going.
Said Lt. Gov. Eleni Kounalakis, who has made the protection of the environment a central piece of her two campaigns for statewide office: 'Jobs are sacred. We have to make sure refineries stay open until we're ready for transition. … Our state is burning and these projects will create good jobs, allow California to lead in clean energy and combat climate change.'
Former state Controller Betty Yee told the audience that 'we can't create a clean environment on the backs of workers. … It's offensive to say we can just retrain workers. It's not about retraining. It's about expertise. We will continue to have oil and gas as we get to a renewable economy.'
But it was former Los Angeles Mayor Antonio Villaraigosa who took the boldest stand in favor of the oil and gas industry and the blue-collar workers they employ: 'We can't continue to be a party of just people who drive a Tesla and not people who drive a pickup or take the bus. We're putting (the) notion of just renewables on the backs of working people. We have the highest gas prices in America. We have the second-highest utilities in America. Because we don't have an 'all of the above' strategy to take on climate change, we're closing down refineries, and that's why we have the highest gas prices.'
I asked the candidates who didn't respond to the question what they thought. Their responses were similar. None wanted to see the refineries close.
Former Orange County Rep. Katie Porter said, 'Clean energy is California's future. Renewable power sources are healthier for residents and cheaper for consumers over the long haul. … But as we transition to a fully clean energy fueled economy, we can't also be blind to our state's current energy needs and where we are falling short when it comes to clean energy production. … We are not yet generating enough clean energy to shut down our existing supply of traditional fuels.'
Superintendent of Public Instruction Tony Thurmond said: 'We need to be moving full steam ahead to expand renewable energy options — while making sure we have a just transition that includes workers and doesn't leave working families behind. But closing refineries will not advance our state's environmental goals. Until we get to a place where renewable energy on its own can consistently and reliably power our state's needs, we should not be shutting down refineries if it means we are just going to be importing that oil from outside of California.'
Former Health and Human Services Secretary Xavier Becerra agreed that 'We must be smart as we deploy an 'all of the above' strategy to keep Californians' energy costs low. … It's a false choice to say we must decide between good-paying jobs in our current energy sector and a clean future for our families. California will lead the way in adapting today's energy infrastructure to achieve energy independence and environmental durability.'
Former state Senate President Pro Tem Toni Atkins said, 'There's no 'just transition' if workers are left behind. … Refineries are facing headwinds nationwide, including in states like Texas, and we need a clear-eyed strategy that prepares us for the future, protects workers and lowers costs for families. We can grow good union jobs and build a future with cleaner air, cars and energy — it's not one or the other.'
It's not just these Democrats who are embracing the reality that California isn't ready to ditch the internal combustion engine anytime soon.
In Washington, 35 House Democrats supported revoking the state's electric vehicle waiver, including two Californians: Reps. Lou Correa of Santa Ana and George Whitesides of Santa Clarita (Los Angeles County).
'The message we got in November was to represent working-class people. But in my district we have a lot of workers — union workers, that drive to and from work. Ninety percent of them drive gas-powered vehicles,' Correa, who owns four hybrid and one gas-powered car, told the Chronicle. 'Long term, EVs are less expensive, but it's called cash flow. … I'm a big environmentalist, but you can't hurt people this way.'
And that is the argument that California Democrats are going to continue to have for at least the next year: When — and how — can we quit our fossil fuel addiction without screwing over blue-collar workers or the environment?
For now, there are no definitive answers.
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