Transitioning from Oil: The Human Cost of California’s Energy Shift
The Personal Side of Industry Closure
In the heart of Sacramento, the story of Willie Cruz serves as a poignant reminder of the challenges faced by California workers amid the state’s ambitious climate policies. Three decades ago, Cruz was taken aback when the Southern California oil refinery where he had dedicated five years of his life suddenly announced its closure. The Powerine Oil Company refinery, situated in Santa Fe Springs just southeast of Los Angeles, left many wondering what the future held.
At 61, Cruz, now residing in Arizona, recounts the moment with a mix of nostalgia and concern. His tenure in the environmental department established him as someone sensitive to both workplace dynamics and health. Faced with uncertainty regarding job security, Cruz decided to pivot his career towards respiratory therapy—a decision influenced in part by his own struggles with asthma. “I thought it was pretty cool, you know—go from polluting to helping, right?” Cruz reflects, embodying a spirit of adaptation that many will need as the oil industry faces further contractions.
A Legacy of Uncertainty
Fast forward to today, and Cruz finds himself advising his son, Wilfredo Cruz, who has spent the last 12 years working at the Phillips 66 refinery in Los Angeles. As Phillips 66 prepares to shutter its operations by month’s end, concerns ripple through a community already burdened by economic instability. With thousands of jobs at risk, a broader narrative emerges—the challenge California faces in balancing environmental goals with the livelihoods of its workforce.
Energy company Valero has also announced plans to close a refinery in the Bay Area, contributing to a larger trend of job losses that may ripple through the economy for years to come. Estimates suggest that over 58,000 workers in the oil and gas sectors may lose their jobs between 2021 and 2030, raising urgent questions about retraining and support.
Political Pressures and Inconsistencies
California’s political landscape reflects the tension of this energy transition. Leading Democrats grapple with the delicate balance between robust climate action and economic stability, particularly in light of rising gas prices that the oil industry attributably blames on state policies. Governor Gavin Newsom’s administration — facing backlash over mixed signals — has halted punitive measures against high oil profits while simultaneously promoting legislation to expedite oil well permitting.
Such inconsistencies leave workers in limbo, unsure of their future within an industry undergoing rapid transformation. With California poised as the eighth-largest crude oil producer in the nation as of 2024, the closure of Phillips 66 and Valero will impact roughly 18% of the state’s refining capacity. The Phillips 66 facility is scheduled to end all fuel production by 2025, citing “market dynamics” among the reasons behind its closure.
The Economic Ripple Effect
Local economies face seismic shifts following the refineries’ closures. The Valero refinery in Benicia, for example, contributes approximately 13% of the city’s annual revenue through taxes, meaning its planned shutdown is poised to deliver a heavy blow to municipal budgets. City Manager Mario Giuliani has dubbed this potential loss a “significant impact,” underscoring the far-reaching consequences for local jobs and services dependent on the revenue stream.
From 2018 to 2024, California lost 46 oil refineries, according to the state’s Employment Development Department, while the fossil fuel sector employs about 94,000 individuals statewide. Legislative efforts, including the Displaced Oil and Gas Worker Fund, have been established to provide some relief through career training programs, but the funding is set to expire in 2027.
A Call for Clarity and Support
As stakeholders navigate these turbulent waters, workers like Wilfredo Cruz are searching for an actionable roadmap. With a current salary of $118,000 as a pipe fitter—a position that traditionally offers financial security without requiring a college degree—Wilfredo illustrates the appeal of the oil industry.
Yet, the health risks linger. Each day upon returning home, he showers immediately to mitigate exposure to harmful chemicals accumulated at work. “There’s not really a real clear plan to be able to get workers from this oil industry into these new fields,” he asserts, reflecting a growing sentiment of being forgotten amid a sweeping transition.
As California aims for a greener future, Faraz Rizvi from the Asian Pacific Environmental Network emphasizes the need for a committed framework to support displaced workers. “We’re in solidarity with workers who have been displaced and who are looking for relief to ensure that they’re able to find work that is important for their communities,” he states.
The narrative surrounding California’s energy evolution underscores a pivotal moment for many families, balancing the need for sustainable policies with the immediate economic realities facing oil workers. Jodie Muller, CEO of the Western States Petroleum Association, voices concerns that current climate policies may jeopardize the instrumental jobs the industry provides, offering a stark reminder that the conversation about future energy must not overlook the human element.
In a state at the forefront of climate efforts, the need for a comprehensive and humane approach is paramount as more workers find themselves at a crossroads in their lives. The road ahead is fraught with uncertainty, but the stories of those like Willie and Wilfredo Cruz shine a light on the necessity for thoughtful solutions that bridge environmental aspirations with economic viability.