Wary Industries View Life Under Clean Air Plan

Just seven months ago, Southern California Edison official Mike M. Hertel was battling the South Coast Air Quality Management District over its clean air plan for the Los Angeles Basin.

He assailed the far-reaching proposal as unworkable and costly and at one point warned of electricity brownouts. Edison spent $1 million to come up with a rival proposal that it said would save hundreds of millions of dollars and meet the federal ozone standard twice as quickly as the AQMD plan.

At the same time, the Western States Petroleum Assn. pressed for adoption of its own alternative. Major oil companies warned that the district’s plan depended on air pollution controls that have not been invented.

Despite the protests, the AQMD last March approved its plan, promising skies so clear in 10 years that people would be able to see for 60 miles. Average visibility today is 10 miles. Within 20 years, AQMD officials pledged, the basin’s four counties--Los Angeles, Orange, Riverside and San Bernardino--would meet all federal Clean Air Act standards.

In the aftermath of the AQMD vote, Edison has become considerably more sanguine about prospects for the future, largely because of a tentative compromise that will save the company about $300 million while still meeting the district’s clean air goals.

In retrospect, Hertel now says, business can live under the clean air plan.

“I think for the vast majority of businesses, it will be possible,” he said.

But oil companies, among others, remain wary.

Force Spending

Les Smith, manager of Arco’s oil refinery in Carson, said the company already has spent $320 million in the last five years for air-pollution controls. The new AQMD plan will force Arco to spend another $250 million to $350 million in the next five years, he said.

“Virtually everything at the refinery is impacted. (The AQMD is) leaving no stone unturned,” Smith said.

The difference in perspective between Edison and Arco in large part reflects their degrees of success in reaching agreement with the AQMD on costly new air-pollution controls.

But in a larger sense, the differences reflect how each industry views its future in a region that is subject to increasingly strict air pollution controls.

The air quality plan envisions, if not an all-electric future, one close to it. Electric cars and trolleys. Electric lawn mowers. The plan strongly suggests evicting petroleum refineries from the basin by the year 2007.

120 Rules Proposed

The AQMD is proposing more than 120 rules in the first five years, including controls on barbecue lighter fluid, new limits on tailpipe emissions from motor vehicles and changes in the chemical formulas of consumer products ranging from house paints to underarm aerosols.

Even though individuals will be forced to make life-style changes, the burden on oil refineries and power plants will be far greater.

Arco’s Carson refinery, for instance, produces one-fourth of all gasoline consumed in Southern California, 125,000 barrels a day. From its 23 processing units, the huge refinery also produces 38,000 barrels of jet fuel and 44,000 barrels of diesel daily. Each barrel holds 42 gallons.

But along with producing a good portion of the region’s fuel needs, the refinery also churns out the basic ingredients of air pollution that help make Southern California the smog capital of America.

10% of emissions

The Carson refinery is one of 10 major oil refineries in the area that account for nearly 10% of all nitrogen oxide (NOX) emissions in the basin, not counting motor vehicles.

Nitrogen oxides, the products of combustion, and hydrocarbons (such as gasoline vapors and paint fumes) are the two principal ingredients of ozone, the health-threatening pollutant that makes up 95% of smog.

Under the new air quality management plan, refineries will have until 1996 to reduce NOX emissions by another 90% from existing levels. Those current levels already reflect a 40% reduction in NOX ordered several years ago.

The estimated cost to the oil industry overall of reducing the emissions has been pegged between $899 million and $1 billion by the Western States Petroleum Assn. The AQMD’s estimate is $412 million. Arco says its cost at the Carson refinery will be $100 million.

“We don’t have any problem spending that money if we can do it right,” Smith said, “but we’ll have an awful time getting down to (the low levels proposed by the AQMD).

Arco Argument

Smith argues that the AQMD limits on NOX will produce only a marginal improvement in air quality but at a very great cost. Smith said the real culprit when it comes to bad air is cars.

“We need to do a better job on our cars. That’s where the biggest NOX problem is,” he said.

Another rule in the plan, scheduled for a vote in 1991, would impose a 90% reduction in existing emissions of acid fog-causing sulfur dioxide even though the basin already complies with federal standards for that pollutant.

A third rule, this one to all but eliminate emissions of microscopic particulates from refinery stacks, would cost the refinery another $20 million to $25 million. Known as PM 10, for particulate matter of less than 10 microns (about half the diameter of a human hair), the pollutant causes reduced visibility in the basin and may produce respiratory problems.

What bothers Smith and the oil companies more than cost, he said, is that the AQMD plan seemingly calls for eliminating refineries from the basin by 2007.

“If the district is truly committed to going to electricity, what is the motive for investing hundreds of millions of dollars for something that’s going to become obsolete?” asks Albert Greenstein, Arco’s manager of media relations.

Elimination Seen as ‘Goal’

District officials say the plan envisions eliminating refineries only as a “goal” that depends upon the availability of alternatives, such as electric-powered cars.

There is yet another concern for the oil industry. If the U.S. Environmental Protection Agency finds part of the AQMD plan wanting, it already has said it will have to impose its own additional controls.

“There are some very likely standing targets . . . the oil industry,” said Pat L. Avery, Arco’s environmental affairs manager.

In contrast to Arco, Edison has worked out a tentative compromise that has left both the district staff and Edison fairly happy. The compromise will go before the AQMD’s governing board for a vote Aug. 4.

In effect, the agreement has eliminated Edison as a major opponent of the new air quality plan, although Hertel, Edison’s manager of environmental affairs, is still worried that Edison will not have enough time to comply.

Hertel’s Concern

His concern is over proposed new controls on NOX emissions from electrical generating plants. The AQMD wants Edison and other electrical utilities to meet the new standard by 1996, a deadline Hertel is not sure he can meet.

Electrical utilities account for 5% of NOX emissions in the basin, about half of that from Edison power plants.

“We spent a lot of very frank, very tough negotiating sessions with the staff,” Hertel said. “I can’t count the hours, but I found (AQMD Executive Officer James M.) Lents to be very fair.”

To reduce NOX emissions to the level proposed by the district, it would be necessary for Edison to spend at least $500 million to install an assortment of new controls on its heaters and boilers that make the steam for generating electricity. The AQMD wants a 77% reduction, a cut that will bring NOX emissions down 92% from 1980 levels.

“No other source category comes even close to that kind of record,” boasted Nader N. Mansour, Edison’s manager of environmental regulation.

NOX Emissions

Mansour reported that a new car puts out as much NOX during a six-mile trip as Edison produces in generating a month’s worth of electricity for the average household, about 500 kilowatt hours.

Originally the AQMD called for a 1993 deadline and other provisions that would have cost Edison $800 million. Under the compromise, Edison says, it will save $300 million.

The compromise, if approved by the AQMD board, would allow Edison and other utilities to “mix and match” control devices. Edison could install less-expensive systems on generating units that are not used as often. But it would install far more expensive--and more effective--NOX control units on generating units that are on-line all the time.

Emissions would not be measured on each generating unit but averaged systemwide.

The more expensive pollution control system, known as an SCR for selective catalytic reduction, can remove from 75% to 90% of NOX emissions spewing from power plant stacks. By comparison, the less costly system can reduce NOX emissions by only 35%.

The difference in costs is significant--$3 to $5 per kilowatt for the cheaper unit and $103 per kilowatt for an SCR, according to Edison.