2025 Valero Report on Guiding Principles - Flipbook - Page 9
Introduction
Safety
Environment
Community
Independent assessments of our
re昀椀ning strategy, under multiple
carbon-constrained scenarios,
found Valero's overall re昀椀ning
portfolio to be resilient.
Responding to the requests of certain
stakeholders regarding independent assessments
of the resilience of our strategy under hypothetical
oil and biofuel demand scenarios, we have issued
three reports following the recommendations
of the Task Force on Climate-Related Financial
Disclosures (TCFD) and using multiple demand
scenarios. Our 昀椀rst TCFD report, the Review of
Climate-related Risks and Opportunities, was
published in September 2018. At that time, we
engaged HSB Solomon Associates (Solomon), a
leading re昀椀ning benchmarking data provider and
advisory 昀椀rm, to conduct an independent analysis
under multiple demand scenarios, including the
potential transition to a lower-carbon economy
consistent with one of the International Energy
Agency's (IEA) 2°C scenarios. In the 2021 TCFD
Report and Scenario Analysis, Solomon examined
our re昀椀ning business and reviewed the resilience
of our strategy under the IEA’s Sustainable
Development Scenario (SDS), referred to as a wellbelow 2°C scenario. And in the 2022 TCFD Report,
Solomon conducted an independent scenario
analysis based on the assumptions of the IEA Net
People
Governance
Appendix
Zero by 2050 Scenario, as applied by Solomon. The
assessments in such reports found Valero’s overall
re昀椀ning portfolio to be resilient.6
In recent years, California's increasingly strict
legislation and regulations have subjected our
re昀椀ning and marketing operations to potential
increased operational restrictions and new
reporting requirements. The considerable
uncertainty and potential adverse effects on our
operations and 昀椀nancial performance resulted
in the evaluation of strategic alternatives for our
operations in California.
In April 2025, we announced that we had submitted
notice to the California Energy Commission of our
current intent to idle, restructure or cease re昀椀ning
operations at the Valero Benicia Re昀椀nery by the end
of April 2026. Valero also reiterated that it continues
to evaluate strategic alternatives for its remaining
operations in California.
In connection with the evaluation of strategic
alternatives for Valero’s operations in California, a
combined pre-tax impairment charge of $1.1 billion
was recorded for the Valero Benicia and Wilmington
Re昀椀neries.
We still encounter certain stakeholders who recognize the value of our low-carbon fuels
initiatives and CCS projects but give no credit to these efforts when accounting for GHG
emissions reductions, and would like us to exclusively focus on signi昀椀cant reductions from
our re昀椀neries (which can only be accomplished by curtailing production or closing assets).
We call on all our stakeholders to advocate with us on the importance of recognizing
reliable and affordable low-carbon fuels that rely on existing infrastructure and engines.
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