Chevron Sits Out Big Oil's Prop. 23 Fight

The Bay Citizen


In the battle over Proposition 23, the most interesting action is taking place on the sidelines.

The proposition would suspend AB 32, California's landmark climate change law, until unemployment in the state is below 5.5 percent for a year. The campaign is being funded with millions from out-of-state oil companies Tesoro and Valero – and now the Tea Party-funding Koch brothers.

But in California, big, traditional business groups--and even bigger oil companies--are keeping their distance from the Yes on 23 Campaign, which dubs itself the California Jobs Initiative.

Yesterday, the California Chamber of Commerce declared it wouldn't take a position on Prop. 23. And Chevron, which makes its home in San Ramon and is never shy about donating to political causes, is also staying neutral.

Henry Brady, dean of the Goldman School of Public Policy, observed that in general AB 32 is good for big businesses that have invested in clean energy. And for an oil company like Chevron, Prop. 23 might just be bad for the company's image.

"Maybe Chevron made the calculation, 'What's the point?'" said Brady. "The atmospherics are bad, and it might not pass anyway."

Passed in 2006, AB32 requires the state to reduce greenhouse gas emissions to 1990 levels by the year 2020.

Chevron spokesman Morgan Crinklaw said that Prop. 23 should be up the voters. But he still emphasized that AB 32 is a problem for Chevron.

"It is clear that the costs to reduce greenhouse gas emissions will fall to California consumers since other national and state governments are not implementing similar policies," Crinklaw said in an email. "At this time we are working closely with the California Air Resources Board to develop a reasonable program that contributes to the state's goal of reducing greenhouse gas emissions in a manner that does not isolate and disadvantage California businesses, but allows for California's economy to grow and remain competitive."

Chevron's oil brethren in Texas are throwing all they've got behind Prop. 23. Late last week San Antonio-based Tesoro dumped another $1 million into the campaign. Flint Hills Resources, a subsidiary of Koch Industries, the subject of a recent New Yorker profile, also put in $1 million. In total, Tesoro has donated $1.5 million while Valero, another Texas oil company has donated $4 million.

"This is an effort by two rogue oil refineries that are out of step with even their own industry," said Steve Maviglio, spokesman for the No on 23 campaign.

A broad range of environmental groups, businesses and politicians are fighting against Prop. 23. Silicon Valley clean energy entrepreneurs and venture capitalists have ponied up millions to fight it. And Republican candidates have been reluctant to endorse it.

The Yes on 23 campaign did not return a call seeking comment.

Berkeley professor Brady observes that a company like Chevron may have nothing to gain from backing an unpopular proposition, especially with other delicate matters on its plate, like the controversial expansion of its refineries in Richmond.

"They've got enough problems with emissions and expanding plants," said Brady. "That's where their battles lie."

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