Concerned Citizens Win Over Phillips on Air Quality

On one side was the Environmental Coalition, a group of about 100 Ventura County residents who pay dues of $10 a year and put out a newsletter lambasting local polluters.

On the other side was Phillips Petroleum Co., a giant oil conglomerate whose $12 billion in assets ranks it 32nd in Fortune magazine’s list of the country’s 500 largest corporations.

And in the middle was the Ventura County Air Pollution Control District, which two months ago was accused by the environmentalists of granting excessive benefits to Phillips for removing three old gas pumps from its La Conchita plant.

The debate was technical, and the participants were sent scrambling to the county rule book like beginners in a bridge game. But when all the hands were played this week, something had happened here that had never happened before:

A small group of people, describing themselves as nothing more than concerned citizens, had challenged the district on an air-quality regulation and won its case before the district’s five-member hearing board.

‘It Can Be Done’

“It’s the first time that a public-interest group has gone to bat with the air pollution control district and won,� said Russ Baggerly, a leader of the Environmental Coalition, after the Monday decision. “That in itself is significant. It lets people know that it can be done.�

District officials were less impressed. “All we’ve done is create extra paper work,� Keith Duval, a district engineer, said.

The dispute began last summer when Phillips told the district that it was going to replace the three gas-burning engines at its La Conchita gas-processing plant on Pacific Coast Highway with non-polluting, electric motors.

Under the federally mandated emission-reduction policy--a system designed to reward companies for removing older, polluting machinery--Phillips was entitled to receive credits that could be used to help it gain approval for future projects.

To achieve a net decrease in pollution, the credit-system customarily allows firms to emit only 80% of the pollutants previously produced. A company that reduces emissions by 100 tons, for example, would receive credits to produce 80 tons of pollution at a future site.

Reduction of 3.3 Tons

In a report last July, the district made a preliminary announcement that Phillips would receive credits for reducing its annual output of reactive organic compounds by 3.3 tons--the amount the engines had been permitted by the district to emit.

But when district engineers went to the plant last September and tested the engines, they discovered the engines were pumping out 61.8 tons a year of the pollutants.

At first, the district decided to give Phillips credit only for the smaller number. Because the permit allowed only 3.3 tons, they reasoned, it would be wrong to reward the company for eliminating equipment that emitted almost 20 times that amount.

Later, however, district engineers changed their minds. They concluded that the violation was merely procedural because Phillips could have received permission to run the engines at the higher rate had the company simply applied for new permits.

Besides, they said, the reduction in emissions was still real. Nearly 62 tons of pollutants were being eliminated, regardless of the number cited on the permits. In a January report, the district announced that Phillips would receive the maximum number of credits.

But Monday that ruling was overturned. In siding with the environmentalists, the county’s Air Pollution Control Hearing Board, which serves as an appeal board to district decisions, concluded that such an interpretation was flawed.

“No way should Phillips get credit for emissions over and above the permit,� said board Chairman John Smithson, adding that such a precedent might encourage companies to pollute more in order to gain extra emission credits.

At a board meeting earlier this month, the district’s top officer, Richard H. Baldwin, argued that the number on the permit was only a rough calculation based on theoretical information about the engines.

Moreover, Baldwin said, because the engines were in place before the district established emission rules, there really are no limits on the amount the old equipment can pollute.

More Accurate Permits

“Whatever it emits, it emits,� he said.

“Well, that’s sad, isn’t it?� Smithson responded.

District officials, who have a right to appeal the decision, said they did not know yet how the ruling would affect their view of similar cases in the future.

Duval, the engineer who processed the Phillips permit, predicted that firms would simply apply for new, more accurate permits before they replace any antiquated machinery.

“They’ll just come in with applications for higher emissions,� he said. “That’s allowable under the rules.�

Only Feasible Inducement

In its appeal, the Environmental Coalition had also asked the hearing board to suspend the entire system of emission-reduction credits, contending that the process could not be justified when the county is so far from attaining federal clean-air standards.

That request had agitated Phillips officials, who argued that the system is the only feasible inducement for firms to replace older machinery with cleaner, state-of-the-art equipment.

But the hearing board declined to discuss the issue, concluding that it was a matter of federal regulation.