California oil refineries exempt from rolling blackouts

by The Associated Press

Rolling blackouts will no longer be a threat to the oil refineries that produce more than a third of California’s gasoline.

State power regulators voted in late June to exempt the refineries and associated pipelines from the outages, ensuring a stable fuel supply and helping to keep gasoline prices from rising. The vote affects 13 refineries in Pacific Gas and Electric Co. and Southern California Edison territory.

Gov. Gray Davis has asked the Public Utilities Commission to minimize disruption of fossil fuel production this summer.

The California Energy Commission said rolling blackouts could cause refineries to lose up to one week of production, which could create gasoline shortages and boost prices at the pump during the height of the summer driving season.

Four oil refiners — Valero Energy, Tosco, Exxon Mobil and Equilon Enterprises — petitioned for blackout exemptions at their facilities that produce about one-fourth of the state’s refining capacity, about 2.3 million barrels a day.

The state’s largest refiner, San Francisco-based Chevron Corp., bypassed the PUC and told Davis it would stop production at its two California refineries if regulators and state lawmakers did not protect it from blackouts.

Chevron controls about 18 percent of the state’s refining capacity.