As Oakland rejects coal, it’s business as usual for Levin-Richmond Terminal

When it comes to shipping coal from California ports, many lawmakers have thrown their support overboard, citing the need to halt climate change by reducing reliance on the fossil fuel. A new statewide regulation prohibits funding for new bulk-coal terminals, and Oakland recently rejected one such terminal in its port. But despite the recently turning tide, it’s business as usual for Richmond’s coal port.

At the privately owned Levin-Richmond Terminal, which operates out of the Richmond port, coal imported from points east is dumped into piles of dry bulk, which steel conveyors then load onto barges for shipment abroad. That makes the Richmond port one of three in California that ship coal. (The publicly operated Port of Stockton and privately operated terminals in the Port of Long Beach also ship coal). A relatively small company, the Levin-Richmond Terminal employed about 60 people two years ago, but today employs around 36.

The terminal isn’t directly affected by legislation Governor Jerry Brown signed last month prohibiting the California Transportation Commission from funding any new bulk coal ports. But declines in coal shipments generally have already forced the company to shrink its workforce and its operations.

The combustion of coal produces carbon dioxide, a greenhouse gas linked to global warming. Environmentalists argue that the more West Coast ports that ship coal, the lower the price of shipping coal—which means that even as the United States turns toward more renewable sources of energy domestically, U.S. coal companies can still flood Asian markets with the commodity, intensifying global warming.

The governor’s signing statement called for a shift toward renewable energy and more efforts to combat climate change. He called recent declines in coal exports “a positive trend that we need to build on.”

The governor’s act was one of several recent activities that have targeted coal and related shipments.

In July, Oakland’s City Council unanimously voted to ban the handling and storage of coal within city limits. The vote came following a proposed $53 million investment, pushed forward by Utah legislators, to build a $250 million coal export terminal in Oakland’s port. In a statement published in the San Francisco Chronicle, California State Senator Loni Hancock, Assemblyman Rob Bonta and Assemblyman Tony Thurmond said that “transporting coal through our communities and exporting it from our ports means turning our backs on our community’s values and risking California’s strong reputation as a climate leader.”

In 2012, environmental group Baykeeper sued the Levin-Richmond Terminal for violating the Clean Water Act, arguing that petcoke, a petroleum byproduct that is also shipped out of the terminal, blew from the terminal conveyor into the bay. And last year, Richmond’s City Council passed two resolutions that called for increased federal, state and local regulation to restrict and limit coal. The resolutions addressed public health concerns raised by the Sierra Club and community groups over toxic coal dust blanketing Richmond neighborhoods near railroad lines. They also included a clause to prohibit city port property from future fossil fuels exportation.

Officials at Levin-Richmond said that declines in coal shipments have led to cuts in their workforce by nearly half, and that last year saw drastic declines in the tonnage shipped, a trend reflected in ports statewide. Company officials estimate that between 2014 and 2015, coal exports dropped at least from 1.4 million to 700,000 tons.

Jim Holland, the director of facilities and equipment at Levin-Richmond, attributed these recent declines to global and national market trends. And company officials said it was doubtful that Oakland’s recent move would divert added business to Richmond.

“If an Oakland terminal existed today, I’m not sure that there would be more tons sold than are being sold now,” said Pat O’Driscoll, Levin-Richmond’s Vice President of Marine Terminal Operations.

However, Stanford university economics professor,  Frank Wolak, said that if more domestic coal ports were built, lower transportation costs would encourage more U.S. coal to flow to markets in Asia—a view that opponents to the Oakland project shared.

Wolak added that port restrictions are ineffectual in reducing global carbon emissions, because other coal-producing countries inevitably meet the demand.

“The world is awash in coal,” said Wolak. “The only thing California is doing preventing exports is destroying jobs in California.”

While the Sierra Club and local groups have rallied against open shipments through Richmond to protect neighborhoods from coal dust, a threat to public health, the city has little jurisdiction to regulate Levin-Richmond.

Nor could the city get around federal preemption on the railways, which act as the lifeblood feeding the black rock to the west.