Many view Costco as one of the “good guys” in corporate America, based on its reputation for treating employees well. Whether or not that is accurate, recent events highlight a very dark aspect of the company. It is eagerly becoming a major player in the fossil fuel industry.
Costco operates over 600 gasoline stations in the United States and beyond, and the numbers are increasing rapidly. Just google “new costco fueling station” and you’ll find reports from California and beyond of Costco’s new and planned “mega” gas stations. Why? Because according to Costco’s annual reports, gasoline and diesel – yes diesel – generate around $10 billion in annual sales and 11 percent of its net sales (2019). It operates no refineries, but leverages its size to strong-arm refiners to supply gasoline and diesel at bargain-basement prices. It doesn’t make alot of money on the gas, but because that gas is cheap, it keeps customers coming back regularly and renewing their memberships, and membership fees generate most of Costco’s profits. So what does Costco do? Build every new store with gas pumps, and push to retrofit older stores to pump gas also.
That is why, although its Novato store has operated successfully for 30 years, Costco suddenly wants to build a 28 pump station that will displace 119 parking spaces in front of the store, directly next to a nature preserve that was created by Vintage Oak’s developers as a mitigation measure. This effort has nothing to do with Marin customers suddenly demanding Costco gasoline.
Costco’s permit application was approved by a divided Novato Planning Commission and forwarded to City Council. To get its way, Costco has employed the same devious tactics large corporations always use to sway local governments: charming city staff with highly paid, arrogant consultants; enlisting customers to sign petitions; dangling enticing projections of increased tax revenue for the City; and promising that if its application is granted, it will renew its lease for 20 years – something it likely would do anyway.
What’s wrong with this picture? Four months ago the Novato City Council adopted a resolution that correctly stated:
“[C]ommon sense and morality indicate that humanity can no longer safely emit GHGs and must demand an emergency mobilization effort to rapidly reach zero emissions across all sectors to safely remove excess carbon from the atmosphere; to preserve and restore the Earth’s biodiversity; to implement safety measures to protect all people and species from the consequences of abrupt warming in the near term; and to cultivate a shift toward climate resiliency that prioritizes conservation, community, and independence from fossil fuels.”
And Costco’s own “Climate Action Plan,” adopted six months ago, states,
“Doing the right thing—for our members, employees, investors, and the health of our global community — is a driving force for continuous improvement at Costco. At today’s rate of growth of global carbon dioxide equivalent (CO2e) emissions, the negative effects of climate change (e.g., extreme weather events, ocean acidification, wildfires, sea level rise, resource scarcity, forced migration, racial injustice, economic inequality, etc.) will likely cause the greatest disruption to life in human history.“
Costco’s application blithely ignores its professed concerns over climate change, and if the Novato City Council approves it, it will be doing the same.
Some have asserted that Costco’s facility won’t increase the use of fossil fuel – it will simply shift where people buy it. The basic laws of supply and demand say otherwise: Costco’s lower prices will inevitably lead to more driving and pollution, and/or facilitate ownership of even more gas-guzzlers than we already have. Don’t tell me you haven’t noticed that you end up using more of anything you buy at Costco, because it’s cheaper. Cheaper is not always better.
Moreover, the real issue here is opportunity costs. With the millions of dollars it plans to spend on this high volume gas station, Costco could install hundreds upon hundreds of solar panels on its roof or parking lot, as well as electric vehicle (EV) chargers to facilitate the transition to EVs. Instead, it seeks to install high volume gasoline retailing capacity that we do not need and never will. Have you every heard of someone having trouble finding gas in Novato?
Gas stations all around will soon start closing, not opening. California has banned the sale of gasoline-powered vehicles in 2035 – only fourteen years from now – but the transition has already begun. For example, GM will introduce 30 new EVs between now and 2025, and stop selling internal combustion engine (ICE) powered cars ten years later. Volvo just outdid GM, announcing it will be out of the ICE car business within 9 years.
While GM and Vovlo commit themselves to the future, Costco fights to build more gas stations, so who’s evil now?
Costco is making a choice, and so should we. If you live in Novato, please contact your council member immediately and urge a no vote on Costco’s application at its hearing on March 9.
At the very least, the Council can consider two alternative approaches:
(1) Delay consideration of the application while the City of Novato considers whether to do what our neighbor city to the north (Petaluma) just did: ban construction of new gasoline stations, or
(2) Delay consideration of the application and ask Costco to come back with a more balanced proposal that includes fewer gas pumps, and adds solar panels and EV chargers.
If you are a Costco member, please express your views to Costco’s CEO: W. Craig Jelinek, Costco Wholesale Corporation, 999 Lake Drive, Issaquah, WA 98027
If you feel strongly enough, enclose your Costco card and demand a membership fee refund unless Coscto promises to stop building more gas stations.