Environmentalists and neighborhood activists have been fighting a Portland fuel terminal for years. Now they’re rallying again, urging city leaders to intervene in a permit process of the Oregon Department of Environmental Quality.

This week, that fight came to City Hall, where a newly elected council got a crash course in a politically charged issue that they may have limited ability to control — at least for now.

Zenith Energy’s been operating in Portland since 2017. It stores and moves both renewable and fossil fuels between railcars, ships and pipelines, and has pledged to end storage of crude oil by October 2027. Its sustainable aviation fuel is used by Portland International Airport, as well as airports in Los Angeles, San Francisco and Seattle.

The company has said its renewable fuels could help the region significantly reduce carbon emissions on roads and from planes. But it still brings fuel into the city by train and stores it here in giant tanks.

The company currently needs a key air quality permit from the state to continue operating. To get that permit, Portland needs to confirm it’s operating in a way that matches city land use laws.

City staff said if that’s the case — and it seems to be — they need to say so, by issuing what’s called a land use compatibility statement, or LUCS. Portland would need to issue that statement even if elected leaders don’t like the company, or the city could face litigation, according to city employees involved in the decision.

That process has opened Portland leaders up to a deluge of emails and outreach from advocates urging them to reject the LUCS.

Portland fuel terminal hits another snag, as regulators send Zenith back to the city

Damon Motz-Storey, director of the Sierra Club’s Oregon chapter, on Tuesday called on Portland City Council to remember the 2016 train derailment in Mosier, Oregon, which spilled 42,000 gallons of fuel and sparked fires and evacuations in the Columbia River Gorge. And they questioned the value of Zenith’s investment in renewable fuels.

“When we hear that Zenith is transitioning to renewable fuels, be skeptical, because these renewable fuels can be just as volatile and explosive, and may be as bad or worse for air quality and the climate,” Motz-Storey said.

“You have the power to make a difference for our community,” they said.

Council members were not convinced they have that power, at least when it comes to the land use compatibility statement Zenith’s presently seeking.

“I’m getting emails from folks who think we have the ability to stop this,” Councilor Loretta Smith said Tuesday, an hour into a day of meetings and testimony about Zenith’s future in Portland ahead of the city’s LUCS decision. “I don’t have a vote on this, I can’t determine the outcome on this.”

Zenith as part of Portland’s Critical Energy Infrastructure Hub

At this stage, power over Zenith’s future is at the state level of government, city staff said.

Even though the council may not act now, it is preparing for future discussions about the city’s Critical Energy Infrastructure Hub, a six-mile stretch of industrial land that includes Zenith and other businesses, where 90% of all liquid fuel in Oregon is stored in large cylindrical riverfront tanks.

When that time comes, Zenith officials said, they hope Portland’s elected leaders see the value in the work they’ve done.

“A terminal operator needs to evaluate and address all potential environmental risks, including seismic vulnerability. We’ve done that,” Grady Reamer, chief commercial officer, told the City Council at Tuesday’s work session. “We believe in safety, environmental stewardship and compliant operations.”

Oregon has limited renewable fuel production, and no pipelines deliver those renewables to the state. Meanwhile, Zenith is the only major rail facility capable of meeting the state’s demand — and so the company plays a critical role in meeting growing demand for renewables, Reamer said.

In a recent letter to Portland Council President Elana Pirtle-Guiney, Reamer acknowledged that Zenith has not been perfect in its efforts, but he also pushed back against critics who have accused the company of greenwashing. And he emphasized the company’s investments in seismic upgrades.

Oregon regulators cancel Zenith hearings, pausing Portland fuel terminal's permit process

The surge of advocacy around Zenith has also left City Council members grappling with their obligations to residents, to the city’s climate goals, and to a business that says it’s invested $160 million in safety upgrades — even as its been dinged for numerous regulatory violations.

“This is also about conflicting policies that we have,” Councilor Olivia Clark said. “Whether it’s a renewable energy future, whether it’s the comprehensive plan and our concerns about disaster resilience, whether it’s about serving future economic needs, there are a lot of conflicting policies, and I don’t think this is the last time we’re going to confront that.”

Portland planners hope to work with elected leaders to update the city’s comprehensive plan as a first step toward adopting new zoning restrictions around fossil fuel infrastructure, and expect to hold a work session March 17.

News Source : https://www.opb.org/article/2025/01/23/portland-city-council-zenith-energy/