Valero has officially closed its Benicia refinery, and with it goes one of the last major fuel-producing operations in a state that still very much runs on gasoline.
The closure isn't a surprise — Valero announced its plans months ago — but the details of the wind-down reveal a fascinating tension between the company and Sacramento. California has asked Valero to idle the refinery in a state where it could theoretically be restarted, rather than fully decommission it. Valero's David Giles made the company's position crystal clear: "Valero doesn't have an intention to do that … but we're keeping that infrastructure in place at their request. We're not going to do that forever."
Read that again. The state is essentially begging a private company to keep the lights on — or at least keep them ready to flick back on — because officials know that California's energy supply is more fragile than the green-transition rhetoric suggests. Giles indicated they'd maintain the infrastructure for maybe a year or two, tops.
This is what happens when you wage a decades-long regulatory war against domestic refining capacity without first building the replacement. California has the highest gas prices in the nation, and we just lost another refinery. The math isn't complicated.
As one Bay Area resident put it, if the state wants the infrastructure maintained and Valero wants to wash their hands of it, "sounds like they could be amenable to selling it at a reasonable price." That's not the worst idea — but who exactly would buy a refinery in a state that has made it abundantly clear it wants refineries gone?
That's the trap California has built for itself. We need the fuel. We despise the producers. We regulate them into oblivion and then act shocked when they leave. Then we ask them nicely to please not tear everything down on the way out, just in case.
The 170 or so workers who lost their jobs aren't abstractions. Neither are the supply-chain implications for a region that imports an increasing share of its refined fuel — often from countries with far worse environmental standards than anything Valero ever operated under in Benicia.
If Sacramento is serious about energy transition, it needs to get serious about timelines, infrastructure, and honesty with voters. Hoping that a departing oil company will babysit idle equipment for a couple of years is not an energy policy. It's a prayer.
