December 17 Colorado Energy Cheat Sheet: Environmental ‘Propaganda’ Agency; electric rate hikes called ‘discrimination’; anti-energy activists promise to ‘ratchet up’ efforts

Some commodity pricing is giving Colorado Xcel ratepayers a temporary reprieve from escalating energy costs:

Xcel said the new rates will result in “significantly lower bills, particularly for natural gas customers, for the second half of the current winter heating season.

“Compared on a year-to-year basis to better gauge the seasonal impacts of weather, both residential and small-business customers’ (natural gas) bills will be approximately 21 percent lower next quarter, when compared to the first quarter of 2015,” Xcel said.

Electricity bills are expected to drop about 5 percent compared to the current quarter, the utility said.

For the most part, Xcel passes changes in commodity prices, and the change in costs associated with supplying power and natural gas, along to customers on a dollar-per-dollar basis.

Commodity prices fluctuate, but the downward trend will be welcome for as long as it sticks around, or until it is offset by higher energy costs elsewhere, due to expensive replacement of baseload power with exotic, renewable energy sources.

***

The next legislative session should feature quite a few oil and gas battles, with one Democratic State Representative queueing up a bill to attack natural resource producers:

State Rep. Joe Salazar, D-Thornton, plans to introduce a bill in the upcoming legislative session that would force oil and gas companies to compensate residents for any loss in property value tied to drilling activities, including damage done by earthquakes linked to deep-earth wastewater injection wells. But state Sen. Jerry Sonnenberg, R-Sterling, has vowed to block the measure in the Senate.

“If it comes to my committee, I’d do everything I can to make it go away,” Sonnenberg said. “Quite frankly, it’s another serious attempt to run oil and gas companies out of business in Colorado… Everyone knows the pro- oil-and-gas bills go to the House to die and that the anti- oil-and-gas bills go to die in the Senate.”

That’s the response Salazar said he expected.

“This shouldn’t be a politicized fight,” he said last Saturday at a Thornton town hall he convened on the issue. “I believe we (in state government) need to give up some of the power to local governments. They need to be able to police these industries in their area.”

The benefit of a divided legislature is that extreme bills like this will likely not make it too far in the opposing chamber. But the bill will still be heard, and we expect some rhetorical fireworks over legislation similar to this.

***

Anti-energy activists in our state plan to “ratchet up” their efforts beyond legal means in the near future:

The leader of a national activist organization behind ban-fracking campaigns in Colorado, Ohio and elsewhere is calling on activists to “ratchet up” civil disobedience and begin “filling up jails.”

The comments are from Thomas Linzey, founder of the Community Environmental Legal Defense Fund (CELDF) in an interview he did with Chris Hedges’ Days of Revolt. From the interview:

HEDGES: “Well, you have talked about it as a kind of military operation. Explain what it would look like.”

LINZEY: “Well, I think it means thinking about civil disobedience differently than we’ve thought about it before. So it’s not just to make a moral or ethical statement; it’s actually aimed at stopping the project itself. And that means, I think, successive days. It means rotating people through. It means bringing people in from other places. It means filling up jails.” (emphasis added)

Linzey went on to suggest that the law isn’t really important here:

“I mean, our resistance has to ratchet up, the opposition has to ratchet up our stuff to a point where it’s actually actively interfering with these projects, because if you don’t do that and you rely entirely on the legal process and the legal process is so stacked against you in terms of what municipalities can and can’t do, that at that point you have no other option but to engage in that type of action.” (emphasis added)

Growing frustration on the part of anti-energy activists seems to be fueling (pun intended) a sense of urgency. We hope this amounts to nothing more than bravado, but hope that Colorado’s natural resource developers–our neighbors–stay out of harm’s way.

***

The Environmental Protection Agency? How about the Environmental Propaganda Agency–says the Government Accountability Office:

Yesterday the Government Accountability Office issued a report concluding that the Environmental Protection Agency (EPA) violated federal law in its use of social media to promote its controversial “WOTUS rule,” redefining the scope of the “waters of the United States” subject to federal regulation under the Clean Water Act. Specifically, the GAO concluded that the EPA violated express limits on the use of appropriations for indirect or grassroots lobbying, and that in doing so, the agency violated the Antideficiency Act.

According to the GAO, the EPA used various social media platforms, including Thunderclap, to develop support for its proposal to expand and clarify the scope of its own regulatory jurisdiction and combat opposition to the rule. The EPA also used social media communications to promote materials supporting the WOTUS rule by environmentalist advocacy groups, including materials that were clearly designed to oppose legislative efforts to limit or block the rule. The GAO labeled these efforts “covert propaganda.” The New York Times had previously documented some of the EPA’s actions.

***

Good legislation is often larded with bad–pork, paybacks, and wheeling-dealing that makes the whole thing a whole lot less palatable–and the proposed extension of the wind production tax credit and the investment tax credit for solar has the renewable industry singing the praises of the proposed lifting of the oil export ban:

Michael Zarin — head of external communications for Vestas — said via email that the company is “pleased” by the proposed extension.

“As currently structured, the extension and phase-out plan would give the industry the longer-term certainty that we’ve been seeking,” Zarin said. “Together with wind energy’s natural competitiveness against other power generation sources, the PTC extension agreement would help ensure a solid future for wind energy in the U.S.”

The solar industry’s investment tax credit, currently a 30 percent credit for commercial, residential and utility-scale solar power systems, also would be extended and phased down through 2022 under the proposal.

The credit, as proposed, would stay at 30 percent through 2019, and then fall to 26 percent in 2020. It would drop to 22 percent in 2021 and 10 percent in 2022. The bill also offers a commence-construction clause that would extend the credit to any project in development started before the end of 2021 and be finished before the end of 2023.

“We are delighted a five-year extension of the Investment Tax Credit has been included in the omnibus bill,” said Rebecca Cantwell, executive director of the Colorado Solar Energy Industries Association. “We worked hard to get it included, and are working hard to make sure it passes.”

***

Mining for a photo-op to discuss the fallout of the EPA’s Gold King Mine spill:

IDAHO SPRINGS – The first-ever congressional hearing inside a mine was held Monday, offering a dramatic image of the impact the Gold King Mine spill has had on policy talks.

The Subcommittee on Energy and Mineral Resources held its field hearing inside the Edgar Mine in Idaho Springs, where the panel discussed legislation aimed at training and recruiting engineers to work on mining reclamation efforts.

“This is weird,” said U.S. Rep. Rob Bishop, R-Utah, chairman of the House Committee on Natural Resources, who made his remarks while wearing a hard hat and looking up at rock formations inside the mine, which is used for training by the Colorado School of Mines.

Discussions around mining reform gained momentum after the August Gold King Mine spill, in which an estimated 3 million gallons of old mining sludge poured into the Animas River, turning it a mustard-yellow. The river tested for initial spikes in heavy metals.

***

Efforts to increase electricity rates in the southwest part of the state were sustained, as a measure to push back failed, with opponents of the rate hike calling the residential-focused increases “discrimination”:

An effort to reverse a decision last month to increase residential electric base rates failed at the La Plata Electric Association’s meeting on Tuesday with a split 6-6 vote.

In November, the board approved on a 6-5 vote a new rate structure that will cost local residents about $5.25 more per month on their electric bills, based on usage. Commercial and industrial users will see an estimated 4 percent decrease on next year’s bills.

However, Tuesday’s main point of contention was last month’s decision to raise the residential base rate from $20.50 to $21.50 a month, which had several board members concerned that the increase would “exacerbate inequality” in the region.

“If we continue to do this, we are harming and discriminating more and more against our members,” said board member Jeff Berman in reference to the 60 percent increase in base charges over the last five years. “I cannot support a base charge increase that exacerbates inequality and discrimination.”

June 18 Colorado Energy Roundup: Pushback on EPA ozone rule effect on rural US, oil and gas operations get the thumbs up from Colorado communities

The Environmental Protection Agency’s proposed ozone rule–reducing acceptable ground-level ozone from 75 ppb to between 65 and 70–has drawn criticism from 22 medically trained members of Congress (E&E Greenwire, behind paywall:

In a letter to EPA Administrator Gina McCarthy, the 22 Republican members of the House and Senate raised questions about the analysis underlying EPA’s conclusions about the public health benefits of a lower ozone limit.

EPA in November proposed to tighten the national ambient air quality standard for ozone from 75 parts per billion — last set in 2008 during the George W. Bush administration — to between 65 and 70 ppb after finding that the 75 ppb limit was no longer adequate to protect public health.

“As healthcare professionals, we rely upon the most accurate health data,” the group of lawmakers wrote. “From this vantage, we believe that the proposal’s harms outweigh its claimed benefits and are concerned it could ultimately undermine our constituents’ health.”

Of the lawmakers signing the letter, 13 have doctor of medicine degrees. Some of the other signatories have been trained as dentists or eye doctors. Two are registered nurses. Sen. Bill Cassidy (R-La.), who has a doctor of medicine degree, led the effort.

From the letter to McCarthy:

Studies show that income is a key factor in public health, a link confirmed by our first-hand experience as medical professionals caring for patients, including the low income and uninsured. As well, stakeholders have noted serious questions regarding the health benefits EPA claims to support the proposal, and we are concerned that the uncertain benefits asserted by EPA in its ozone proposal will be overshadowed by its harm to the economy and human health. In light of the long-term continuing trend towards cleaner air, as well as ongoing work by states toward further improvements under existing regulations, we encourage EPA to protect American jobs, the economy, and public health by maintaining the existing ozone NAAQS [National Ambient Air Quality Standards].

The letter, citing a study from the National Association of Manufacturers, points out that at a 65 ppb threshold for ozone, rural areas like Yellowstone and the Grand Canyon National Parks would fall into “non-attainment” of the new standard, and as much as over half the entire nation. This would lead, naturally, to job loss and economic turmoil, “making the proposal the most expensive regulation in U.S. history.”

***

Oil and gas development a boon to one Colorado community, whether or not the company’s investment pans out:

DE BEQUE — A natural gas project by Black Hills Exploration & Production in the De Beque area is involving some upfront investment risks by the company, but with the potential of large rewards for not only Black Hills but the region’s economy and tax base.

Whatever happens, the investment already is paying off for local farmers and ranchers, thanks to a pipeline and water pump station project that officials celebrated the completion of Friday. Black Hills paid for the $8 million project to help supply water for its hydraulic fracturing of wells, but most of the water will be used for irrigation, including by the town, which will reduce De Beque’s need to exercise its senior water rights at the expense of area ranchers.

The water project is an upfront investment that won’t fully pay off for Black Hills unless its De Beque drilling project proceeds to the development phase. But John Benton, vice president and general manager of Black Hills E&P, likes the fact that the company has built something of such value to the De Beque area no matter how its drilling project pans out.

“Regardless of whether we go forward or not with our program, it’s created something that will benefit the community for years to come,” he said.

If the project proceeds, Mesa County could see not only more jobs but an increased tax base.

***

Not all Colorado communities are filled with activists seeking to ban or otherwise hinder oil and gas development in their back yard:

A few years after a series of anti-oil-and-gas ordinances and ballot initiatives cascaded through several towns in Colorado, some local governments are speaking up in favor of the state’s multibillion-dollar energy industry.

In the last few months, trustees in the tiny town of Platteville in Weld County and commissioners from counties near Denver have signed letters and passed resolutions that speak in favor of the industry and its high-paying jobs.

“If there’s someone who comes in and wants to ban fracking, at that time we’ll vote on it,” Bonnie Dunston, Platteville’s mayor, told the Denver Business Journal.

“But we’re not going to ban fracking. Oil and gas does a lot for us, for our town, our community, and we’re just saying that we’re going to keep oil and gas going here in Platteville,” she said.

Douglas, Arapahoe, and Jefferson county officials have all recently either affirmed support for responsible development within the oil and gas industry or indicated their opposition to bans of any kind, according to DBJ. The officials noted that, while the counties did not see as much direct involvement within their borders compared to places like Weld County, many of their residents worked within the industry.

May 28 Colorado Energy Roundup: EPA water rule, Hickenlooper pleads for Colorado mine, reduced drilling costs

Yesterday, Governor John Hickenlooper says chances for a statewide ballot measure on fracking in 2016 are pretty low, but anti-energy fractivists aren’t so sure about Hickenlooper’s prognostication:

Gov. John Hickenlooper on Wednesday said he does not believe there is momentum to push a state ballot initiative that would crackdown on the oil and gas industry.

The Democrat spoke along with Republican U.S. Sen. Cory Gardner at a breakfast in Denver hosted by industry leaders and supporters, including Vital for Colorado.

“There will be proposals, but I don’t think there will be something that will be funded to any significant extent, and therefore I don’t expect something to get on the ballot,” Hickenlooper said.

Hickenlooper is not viewed positively by the strident activists who considered the governor’s brokered deal to get the ballot measures off the table and replaced by his blue-ribbon fracking commission as a stab in the back:

“Governor Hickenlooper’s blowing hot air to justify his continued endorsement of the fracking fiasco that is making Coloradans sick, driving down property values and threatening our air and water,” said Sam Schabacker, spokesman for Food and Water Watch, one of several groups discussing local and statewide ballot initiatives. “Outrage continues to grow over the governor’s inaction to stop fracking and more parents, business owners and community members are speaking out than ever.”

The only question is whether or not the anti-fracking forces find another funder like Rep. Jared Polis (D-CO). National groups are likely to go playing in Colorado, as the issues (setbacks, water, air quality) surrounding fracking haven’t disappeared, and were certainly not dealt with to any significant degree by the state’s recently concluded commission.

At least not in the estimation of the groups who would bring more ballot proposals to the Secretary of State by next year.

***

You might think that the Environmental Protection Agency’s final “water” rules won’t have an impact on energy production, but its wide-ranging scope as defined by EPA administrator Gina McCarthy should give anyone pause:

“For the water in the rivers and lakes in our communities that flow to our drinking water to be clean, the streams and wetlands that feed them need to be clean too,” said EPA Administrator Gina McCarthy.

Under the rule, tributaries and headwaters that show physical features of flowing water — a bed, bank and high-water mark — would be subject to the Clean Water Act. So would waters that are next to rivers and lakes and their tributaries. Ditches that are constructed out of streams or function like streams and can carry pollution downstream also would be covered. But ditches that flow only when it rains wouldn’t be covered, according to the EPA.

Business groups, however, contend the rule is broader than the EPA describes. They vow to fight it in the courts and in Congress. Earlier this month,the House passed legislation that would require the EPA to withdraw the rule, which was dubbed the “Waters of the United States” rule before the EPA rebranded it.

The National Association of Manufacturers opposes the definitions provided by the EPA, saying it “all adds up to increased regulatory uncertainty, permitting costs, delays and even litigation, not to mention a giant new set of hurdles standing in the way of construction.”

Given the proximity of many energy sources to rivers, streams, and other bodies of water, the EPA’s regulations will surely add cost to energy production and quite possibly halt new electricity generating units that will not comply with the new environmental impact statements the water rule will surely require.

Of course, the EPA’s own manufacturing attempts–in this case public comments in support of proposed rules–will likely not cease any time soon.

***

For the residents of northwest Colorado, Craig Station and the nearby Colowyo Coal Mine near Craig literally power the local economy, and a shutdown of the mine would cripple the local economy, perhaps permanently–so Gov. Hickenlooper has intervened:

Hickenlooper on Friday asked U.S. Interior Secretary Sally Jewell in a letter to “do everything possible” to prevent a shutdown of the Colowyo Coal Mine near Craig.

The mine currently employees about 220 people and supplies coal that powers the Craig Station, one of the state’s largest coal-fired power plants. According to Colowyo’s owner, the station is capable of producing up to 1,303 megawatts of electricity.

Hickenlooper said in the letter that the mine also contributes more than $200 million to the regional economy and generates tax and royalties of $12 million annually.

“Given the importance of this mine to the economies of the region, I ask that you do everything possible to respond to the judge’s order and remedy the situation as expeditiously as possible,” Hickenlooper wrote in the letter.

Whether or not Sec. Jewell’s agency will appeal the court ruling calling for additional environmental impact statements remains to be seen.

Meanwhile the plans to put a transmission line through Moffat County, where the Craig power plant and mine reside, continue apace. The line would send electricity from wind farms in Wyoming to California.

***

Lower demand for services means some relief for driller’s in Colorado’s embattled oil and gas sector:

But the slowdown also has produced at least one upside for companies: increased availability of rigs from drilling contractors and lower costs for drilling and completing wells.

For some companies operating locally, it has helped justify drilling and completing wells at all with gas prices so low. For one company, Black Hills Exploration & Production, it resulted in a recent ramp-up from one rig to three, tying it with WPX Energy as the busiest driller in western Colorado’s Piceance Basin.

But it is not just a downturn in natural gas prices that has hurt the industry, but government red tape as well:

Bill Buniger, a Loma contractor who does energy work such as well pad construction, said he’s not willing to take a cut in pay.

“The thing about it is, when you take a cut like that, your margin of profit, that’s what you’re cutting out. All you’re doing is wearing out your machines,” he said.

The costs of things like tires and repairs don’t change, he said. Buniger, 70, has paid off most of his equipment and said he’d rather let it sit if he can’t make a profit.

Not that he’s had much of a choice. He said most of the companies he works for are small, independent oil and gas companies that simply aren’t doing any drilling, due to low oil and gas energy prices at a time of increasing state regulations.

And while commodity prices will continue to fluctuate, the state’s regulatory burden won’t be lifting any time soon.

***

Vincent Carroll, writing for the Denver Post, is skeptical of Gov. Hickenlooper’s claims that avoiding a listing of the greater sage-grouse by the Fish and Wildlife Service isn’t a slam dunk:

“We are very, very close to avoiding a listing altogether,” Hickenlooper told members of the Associated Governments of Northwest Colorado two weeks ago, according to The Daily Sentinel. He said Interior Secretary Sally Jewell would like to avoid a listing, and “I believe her. I don’t think she’s posturing.”

But of course what else would she say to him? That federal officials are eager to impose draconian restrictions on a vast swath of Western land over the bipartisan objections from all 11 governors and despite little evidence from past listings that it would do much good?

May 14 Colorado Energy Roundup: fracking, ozone, and a national renewable energy standard

Energy In Depth’s Simon Lomax pokes holes in the American Lung Association’s report on ozone–and the Denver Post’s reporting on it–with input from the Colorado Department of Public Health and Environment:

Citing its own April 29 “report card” on the region’s air quality, the ALA told the Denver Post that levels of ground-level ozone – sometimes called smog – are deteriorating rather than improving. But the ALA went much further, claiming that while the air above the Denver metro area “looks cleaner than in the 1970s,” the region actually has “higher ozone” and the gains made since the 1970s “are going away.”

In the same news story – authored by the Post’s environmental writer Bruce Finley – the Colorado Department of Public Health and Environment (CDPHE) warned the ALA’s report card was “both inaccurate and misrepresents air quality in Colorado.” But Finley’s story didn’t detail what those inaccuracies and misrepresentations actually were.

In a follow-up interview with Energy In Depth, CDPHE’s Air Pollution Control Division (APCD) Director Will Allison revealed that the ALA report card ignored a full year of air quality data from 2014, which shows ozone levels getting better, not worse. To claim there’s higher ozone now than back in the 1970s also ignores decades of air quality data that show “it’s gotten a lot better,” Allison said.

To say the ALA took a liberal look at its own conclusions to bolster an argument for increased ozone regulation appears correct.

“If you look at 2011-2013 averages, we had 10 monitors in the Denver North Front Range that exceeded the ozone standard of 75 parts per billion. But if you look at the 2012-2014 averages, only four monitors exceeded the federal standards. So there was a significant drop from 10 noncompliant monitors to four,” Allison told EID.

***

Colorado’s 21-member oil and gas task force, which concluded its meetings in February, received modest support (about $2 million) in the Colorado legislature for a handful of its recommendations:

The budget includes:
$1,364,713 to pay for 12 new employees for the Colorado Oil and Gas Conservation Commission (COGCC), the state agency charged with overseeing the state’s multibillion-dollar oil and gas sector.
$360,910 for the Colorado Department of Public Health and Environment (CDPHE) to create a hot line and website with information about the industry, and a chance to raise concerns about its operations.
$402,859 for the CDPHE to create a mobile air monitoring unit to watch for air pollution from industry operations and a person to operate it.

These small changes stand in contrast to some of the more pointed and disruptive resolutions the committee considered, and to the ballot measures that tripped off the Governor’s “compromise” move last August.

Fracking opponents, of course, decried the legislative session’s activity on oil and gas issues, while the industry hailed the results, according to Valerie Richardson at The Colorado Statesman.

Kicking the can down the road to 2016 on fracking issues–with Democrats sidestepping a fractious debate, as Richardson put it–may still not prove advantageous to Democrats split over the issue. With eco-left activists vowing to work hard again next November and having felt betrayed by maneuvering in 2014, Sen. Michael Bennet’s re-election efforts might not get the smooth ride his party was hoping to craft. It certainly didn’t help former Sen. Mark Udall, who carved a more eco-friendly niche in his term, but ultimately suffered defeat last year.

***

Speaking of Sen. Bennet–an attempt to bolster his green credibility with new legislation aimed at a national renewable energy standard:

The bill unveiled Tuesday that would require utilities to generate 30 percent of their electricity from renewable energy sources by 2030, starting with an 8 percent requirement by 2016 followed by gradual increases.

Sen. Tom Udall has introduced this legislation in every session of Congress since 2008. The bill is based on his bipartisan initiative that passed the House in 2007. Co-sponsors this time around include Sens. Edward Markey (D-Mass.), Martin Heinrich (D-N.M.), Michael Bennet (D-Colo.), Jeff Merkley (D-Ore.), Sheldon Whitehouse (D-R.I.) and Mazie K. Hirono (D-Hawaii).

“A national Renewable Electricity Standard (RES) will help slow utility rate increases and boost private investment in states like New Mexico — all while combating climate change,” Udall said in a news release. “Investing in homegrown clean energy jobs just makes sense, and that’s why I’m continuing my fight for a national RES.”

***

Colorado’s western slope counties may avoid economic devastation if the Fish and Wildlife Service decides not to tap the greater sage-grouse with a designation as threatened or endangered:

The Interior Department has said it wants to reach the point that the Fish and Wildlife Service can find that no listing is warranted. Much of that decision lies with the way the BLM manages its lands and both agencies report to Jewell.

“We are very, very close to avoiding a listing altogether,” Hickenlooper said, noting that he spoke to [Secretary of Interior Sally] Jewell 10 days ago.

Finding that the bird should not be listed is Jewell’s goal, Hickenlooper said.

“I believe her. I don’t think she’s posturing.”

A listing by the FWS would be a critical blow to Colorado’s western counties, along with 10 other states, as one county commissioner told Gov. Hickenlooper.

“All of Moffat County is out of business,” Moffat County Commissioner Chuck Grobe concluded, should the listing move forward contrary to Hickenlooper’s claims.

Energy by the Numbers

May 12, 2012 by Amy · Comments Off
Filed under: Archive 

Sound energy policy must be rooted in fact rather than fiction and reason rather than emotion. Recently, the Institute for Energy Research released a well-researched, extensively-cited, easy-to-read primer on energy. We encourage you to read all 68 pages of Hard Facts: An Energy Primer.  For those who want a cliff notes version, a few key facts are provided below.

Fossil Fuels:

  • In 2011, the United States produced 23.0 trillion cubic feet of natural gas, making it the world’s largest natural gas producer.
  • In 2011, the United States produced 5.67 million barrels of oil per day, making it the world’s third largest oil producer.
  • Proved conventional oil reserves worldwide more than doubled from 642 billion barrels in 1980 to more than 1.3 trillion barrels in 2009.
  • The United States is home to the richest oil shale deposits in the world—estimates are there are about 1 trillion barrels of recoverable oil in U.S. oil shale deposits, nearly four times that of Saudi Arabia’s proved oil reserves.
  • The United States has 261 billion tons of coal in its proved coal reserves. These are the world’s largest coal reserves and over 27 percent of the world’s proved coal reserves.
  • The United States produces nearly 1.1 billion short tons of coal a year, making it the world’s second largest coal producer.
  • China produces over 3.5 billion short tons a year.
  • The United States has 486 billion tons of coal in its demonstrated reserve base, enough domestic coal to use for the next 485 years at current rates of consumption. These estimates do not include Alaska’s coal resources, which according to government estimates, are larger than those in the lower 48 states.
  • The federal government leases less than 3 percent of federal lands for oil and natural gas production—2.2 percent of federal offshore areas and less than 5.4 percent of federal onshore lands.
  • The world could hold more than 700 quadrillion (700,000 trillion) cubic feet of methane hydrates—more energy than all other fossil fuels combined.

Renewables and Nuclear:

  • In 2011, wind power produced 1.2 percent of the energy used in the United States.
  • In 2011, solar power produced 0.1 percent of the energy used in the United States.
  • Total federal subsidies in fiscal year 2007 were $24.34 per megawatt hour for solar-generated electricity and $23.37 per megawatt hour for wind, compared with $1.59 for nuclear, $0.67 for hydroelectric power, $0.44 for conventional coal, and $0.25 for natural gas and petroleum liquids.
  • In fiscal year 2010, the subsidies were even higher. For solar power, they were $775.64 per megawatt hour, for wind $56.29, for nuclear $3.14, for hydroelectric power $0.82, for coal $0.64 and for natural gas and petroleum liquids $0.64.
  • In 2011, hydroelectric power contributed 3.3 percent of the energy used in the United States and 7.9 percent of the electricity.
  • Today, there are 104 nuclear reactors in the United States and construction began for all of these reactors prior to 1974.

Energy Efficiency:

  • Since 1970, the six so-called “criteria pollutants” have declined by 63 percent, even though the generation of electricity from coal-fired plants has increased by over 180 percent, gross domestic product has increased by 204 percent, energy consumption has increased by 40 percent, and vehicle miles traveled have increased by 168 percent.
  • Energy use per person in the United States fell 12 percent between 1979 and 2010 from 359 million BTUs to 317 million BTUs per person.
  • Energy intensity—energy consumption per dollar of GDP—fell by 52 percent between 1973 and 2011.
  • In 2010, China was responsible for 24 percent of global carbon dioxide (CO2) emissions. In comparison, the United States, the second largest emitter of carbon dioxide, emitted 17 percent of the global total.
  • China’s CO2 emissions increased by 167 percent between 1999 and 2009, while CO2 emissions from the United States decreased by 4.4 percent over the same 10-year period.

Other Numbers:

  • Renewable energy subsidies were 49 times greater than fossil fuel subsidies when comparing the amount of energy produced per dollar of subsidy.
  • In 2009, renewables received a 77 percent share of total federal energy incentives while fossil fuels received a 13 percent share but produced 7 times the energy.

We are agnostic on energy resources. It is our strong belief that the choice of energy resources should come from the demands of the free market, and not from the preferences of policymakers, lobbyists, or special interest groups. Subsidies only encourage lawmakers to pick winners and losers in the energy industry that distort the market and end up costing consumers more.

Stupid is as stupid does

December 14, 2011 by Amy · Comments Off
Filed under: Archive, New Energy Economy 

Colorado MoveOn member Kyle Elston sent the following email asking Colorado’s anti-fossil fuel, kool-aid drinking community to electronically sign a petition telling Routt County Commissioners to put a moratorium on “all future oil and gas exploration permits until” — you’ve probably guessed it already — more stringent rules and regulations are in place. Read the whole email below.

Dear Colorado MoveOn member,

Oil and gas companies are pushing to expand their operations in beautiful Routt County, which includes Steamboat Springs.

Before Routt County becomes overrun by the oil and gas industry, we need our county commissioners to impose a moratorium on all future oil and gas exploration permits until proper rules and regulations are in place that will adequately protect both the environment and the public health of Routt County residents.

That’s why I created a petition to the Routt County Board of County Commissioners on SignOn.org, which says:

Considering the attention that the issue of oil and gas exploration in Routt County has received, and the overwhelming public support for a moratorium on all future oil and gas permits until adequate county rules and regulations are put in place, we ask that you please listen to your Routt County constituents and take all necessary measures to impose such a moratorium immediately.

Will you sign the petition? Click here to add your name, and then pass it along to your friends:

http://www.moveon.org/r?r=268752&id=33814-19072883-Yqs3wmx&t=2

Thanks!

–Kyle Elston

I don’t know how many are on Colorado’s MoveOn email list, but it appears that Kyle has had some success. His goal is 3,000 signatures, and right now he has just over 2,300 with the usual comments:

Patricia K. Baker, Bellvue, CO, “We must protect such a beautiful area.”

Charles & Myrta Anderson, Arvada, CO, “Water wells have already been contaminaated [sic] where fracking has been allowed. When we have no clean water to drink, we die! Protect our water sources.”

Drew Aslin, Boulder, CO, “I have personally driven through Routt and Rio Blanco county recently and have seen the harmful effects of oil and gas drilling from reservoirs. It is tainting the quality of the water and this needs to stop. It is not environmentally friendly, and it is not going to stimulate our economiy [sic]. Let’s invest in RENEWABLE ENERGY instead :) .”

For the record, hydraulic fracturing has not contaminated any groundwater supplies, so I doubt anyone will die due to lack of clean water in Routt County. As for being eco-friendly, few energy sources are more environmentally damaging or economically unsound than “renewable” energy.

For the sake of Routt County residents, taxpayers, and anyone who enjoys affordable, reliable, abundant energy, let’s hope that Routt County Commissioners are brighter than the average Colorado MoveOn member and allow oil and gas exploration permitting to continue.

Media acts like eco Chicken Littles

December 9, 2011 by Amy · Comments Off
Filed under: Archive, New Energy Economy 

Has any media outlet bothered to ask if the EPA’s theory on groundwater contamination in Wyoming and hydraulic fracturing is even right?

The Independence Institute’s Energy Policy Blog can’t be accused (at least not accurately) of being in the tank for the oil and gas industry. We’ve been on opposite sides of several of the industry’s key issues in Colorado. We opposed HB 1365, the fuel-switching bill, and HB 1291, the State Implementation Plan. We favored a repeal of Colorado’s carbon tax, while the oil and gas industry argued for the language to remain in statute.

Now, however, these pages are defending the oil and gas industry against attacks on the decades-old, proven process of hydraulic fracturing, which pumps a blended liquid into the ground (far below water tables) to increase the flow of natural gas and oil. Already heavily regulated, hydraulic fracturing is a safe, cost-effective way to expand production, lower the price of liquid fossil fuels, ensure an abundant domestic supply, create high paying jobs, and provide revenue to local and state governments.

The latest EPA announcement is just another battle in the war on fracking, which is an attempt by anti-fossil fuel activists to shut down domestic production and force consumers to use more expensive, less reliable wind and solar energy sources. And the media serves as a willing accomplice.

Today’s Denver Post jumped on the freaked out over hydraulic fracturing bandwagon following yesterday’s sensational EPA release that a “draft finding” MAY link hydraulic fracturing to groundwater contamination in Pavillion, Wyoming.

The front page, top of the fold print edition reads, “HYDRAULIC FRACTURING: Wells tied to fouled water. The Wyoming study could affect Colorado’s oil and gas industry.”

The online edition warns: “Hydraulic fracking linked for first time to groundwater pollution.”

With the exception of the last line in the first example, neither headline is accurate. Media around the world has reacted more like Chicken Little environmentalists rather than reporters of news, disseminators of information.

Energy In Depth (EID), a public outreach campaign supporting the development of America’s oil and gas resources, issued its own press release this morning about the media response:

Call it a sign of the ‘Times,’ let’s say, that less than 24 hours removed from the release of EPA Region 8’s report on groundwater sampling near Pavillion, Wyo., nearly a thousand different news stories have been generated — in 12 different countries, and best we can tell, four different languages. But set aside the breathless headlines for a moment and the triumphant quotes from a small segment of folks committed to ending the responsible development of natural gas, and one’s left with a pretty straightforward question: Is EPA right? And if so, what exactly does that mean moving forward?

It’s impossible to answer the second question without an answer to the first, but that hasn’t stopped the media from trying. In fact, they haven’t even considered whether or not the EPA is right.

The Denver Post’s first paragraph from both the online and print editions reads:

Hydraulic fracturing, a controversial oil-and-gas production technique used in Colorado and across the country, has been linked for the first time to groundwater pollution in a case near Pavillion, Wyo.

First, fracking isn’t “controversial.” The process of hydraulic fracturing has been used successfully since 1949 and is not “linked” to groundwater contamination. Colorado is proof that it can be done in an eco-friendly way. More than 90 percent of our nearly 40,000 wells produce using hydraulic fracturing, and not a single case of groundwater contamination. It is a highly regulated process within a highly regulated industry. The only reason it is “controversial” is because anti-fossil fuel activists say it is.

Second, it hasn’t been linked this time either. The EPA’s press release calls it a “draft finding,” meaning it hasn’t been through any kind of peer review process. Furthermore, even the EPA says fracking “may” be the cause, not “has been linked” to groundwater contamination.

The Denver Post continues to advance the story by assuming the EPA has correctly found a “link” and that this “link” is a game changer. Reporter Mark Jaffe quotes Wyoming Governor Matt Mead’s press release about how this could have a “critical impact” on the oil and gas industry and that more research must be done. But the paper leaves out the most important part of Mead’s release – the first line: “the Environmental Protection Agency’s draft study on Pavillion wells is scientifically questionable and more testing is needed.”

Mead is trying to answer the most important question first. Is the EPA right? Yet the Post and many other news organizations have jumped to the second question, of what does this mean, without any validation or curiosity about the first.

Anti-fossil fuel activists certainly won’t challenge the EPA’s theory. The Associated Press reported, “Environmentalists welcomed the news of the EPA report, calling it an important turning point in the fracking debate.”

EID actually provides several questions that should be answered first, but the mainstream media isn’t even bothering to ask:

  • Why the huge difference between what EPA found in its monitoring wells and what was detected in private wells from which people actually get their water?
  • After reviewing the data collected by Region 8, why did EPA administrator Lisa Jackson tell a reporter that, specific to Pavillion, “we have absolutely no indication now that drinking water is at risk”? (video available here)
  • Did all those chemicals that EPA used to drill its monitoring wells affect the results?

At least one member of Congress is calling for an answer to the most important question, “Is the EPA right?” Is its theory accurate? Senator James Inhofe (R-Okla.), Ranking Member of the Senate Committee on Environment and Public Works, made the following comments after speaking with EPA Administrator Lisa Jackson about her agency’s “irresponsible” announcement on fracking:

EPA’s conclusions are not based on sound science but rather on political science.  Its findings are premature, given that the Agency has not gone through the necessary peer-review process, and there are still serious outstanding questions regarding EPA’s data and methodology.

This announcement is part of President Obama’s war on fossil fuels and his determination to shut down natural gas production.   Unfortunately for Americans, his agenda destroys good paying jobs in one of the few industries that is thriving, and increases our dependence on foreign oil.

As recently as November 9, 2011 EPA Regional Administrator James Martin said that the results of the latest round of testing in Pavillion were not significantly different from the first two rounds of testing, which showed no link between hydraulic fracturing and contamination.  Yet only a few weeks later, EPA has decided the opposite.  EPA is clearly not prepared to be making conclusions.

There is a pattern emerging here.  Just a few months ago, the EPA Inspector General found that EPA cut corners on the endangerment finding to come to what appears to be a predetermined conclusion to regulate greenhouse gases.  This most recent study on hydraulic fracturing is apparently more of the same in the Obama Administration’s ongoing war on affordable energy.

It is irresponsible for EPA to release such an explosive announcement without objective peer review. Given the serious flaws in EPA’s process, I have asked EPA Administrator Lisa Jackson to release all the data, methodologies and protocols that have been used, and she has made a commitment to do so.

Even with the most stringent regulations, no energy source is completely without risk. But the EPA’s premature release of its theory on groundwater contamination, along with the anti-fossil fuel crowd’s cheers, and the media’s lack of critical reporting indicates more of an agenda to damage the oil and gas industry rather than assure safety in hydraulic fracturing.

Wyoming Governor reacts to EPA “draft finding” on fracturing

December 8, 2011 by Amy · Comments Off
Filed under: Archive, New Energy Economy 

While the rest of the world loses its collective mind over an Environmental Protection Agency “draft finding” that hydraulic fracturing may be the cause of groundwater contamination in Pavillion, Wyoming, Governor Matt Mead is a voice of reason. In a press release from his office, Mead stated, “the Environmental Protection Agency’s draft study on Pavillion wells is scientifically questionable and more testing is needed.”

Too much is at stake, according to Mead, including his state’s economic and environmental health and well being, to overreact to “draft findings”… “based on data from two test wells drilled in 2010 and tested once that year and once in April, 2011. Those test wells are deeper than drinking wells.”

Bottom line is that more information is needed before blaming hydraulic fracturing, but that won’t prevent hysteria in the anti-fossil fuel crowd. The full text of Governor Mead’s press release is below:

Governor Mead: Implications of EPA Data Require Best Science

CHEYENNE, Wyo. – Governor Matt Mead said today that the Environmental Protection Agency’s draft study on Pavillion wells is scientifically questionable and more testing is needed.

“We believe that the draft study could have a critical impact on the energy industry and on the country so it is imperative that we not make conclusions based on only four data points,” Governor Mead said. “Those familiar with the scientific method recognize that it would not be appropriate to make a judgment without verifying all of the testing that has been done.”

Residents near Pavillion have complained about their water wells for several years. They are entitled to answers and they need clean water. Therefore, Wyoming formed a working group to investigate the problem. That group included residents, state agencies, Tribes, EPA and the Bureau of Land Management. The study released today from EPA was based on data from two test wells drilled in 2010 and tested once that year and once in April, 2011. Those test wells are deeper than drinking wells. The data from the test wells was not available to the rest of the working group until a month ago.

“The first review of the study by the Pavillion Working Group was unable to resolve many of the questions related to the sources of the compounds detected,” said John Corra, Director of the Wyoming Department of Environmental Quality and a member of the Working Group. State agencies, representatives of the Tribes and the BLM all raised similar concerns to the EPA.

Specifically, Wyoming and other members of the Pavillion Working Group have raised questions about the lack of replication of testing (typically findings from only two sampling events suggest that more sampling is needed before conclusions can be drawn). Members of the working group also have questions about the compound 2-BE, which was found in 1 sample out of 4 that were taken, and why it was only found in results from one lab, while other labs tested the exact same water sample and did not find it.

“More sampling is needed to rule out surface contamination or the process of building these test wells as the source of the concerning results,” Tom Doll said. Doll is the Wyoming Oil and Gas Conservation Supervisor and a member of the Pavillion Working Group.

Governor Mead has asked the EPA to partner with Wyoming and industry to do the necessary further testing. He said he was pleased to hear that the EPA would be willing to partner in that effort. Wyoming will take part in the peer review of the draft. “My takeaway message is that both the EPA and Wyoming believe this is only the beginning of the process to understand the cause and scope of what was found. There are too many questions raised by what we have seen so far to not pursue further information,” Governor Mead said.

“We do not want to predetermine the outcome of further research, but do feel the need for more thoroughness. I want to know what happened in Pavillion and feel the responsible approach is to do more testing,” Governor Mead said. “What we do know is that there has not been fracking in this area for several years and that there have been significant changes in our drilling regulations since then. Wyoming has led the country in regulating fracking because we want to protect our people, protect the environment and bring energy to the nation. More research will only help us.”

Earlier testing did show problems with a few drinking wells near Pavillion. The working group will continue to explore causes with those wells. Currently, the people with concerns about their drinking water are being provided water by industry. Wyoming has also commissioned a study to look at alternative water supplies for these residents.

Is Colorado “addicted” to economic activity?

December 6, 2011 by Amy · Comments Off
Filed under: Archive, New Energy Economy 

Part two of a series responding to a Denver Post guest column titled “Is Colorado addicted to oil?” from Gary Wockner of Clean Water Action.

Gary Wockner’s editorial is long on conjecture and short on facts. It’s little more than 20 questions, which could be answered if Wockner bothered to do a modicum of research. I answered his headline, “Is Colorado addicted to oil?” in my first post. Now I’ll address his next questions about the “role” of the oil and gas industry in Colorado’s economy.  Wockner begins:

A few years ago, President George W. Bush stood in front of Congress in a nationally televised speech and said that “America is addicted to oil.” And then he spoke about how we must end that addiction for the good of our economy, our environment, our national security, and our future. Recently, after another huge oil field was discovered in Weld County, Gov. John Hickenlooper was quoted in The Denver Post as saying, ‘Anadarko’s announcement today shows once again that Colorado is a leader in the energy sector of our country’s economy. We are thrilled to see the company plan a significant investment in Colorado.’

Addicted or thrilled? Which is it?

Obviously Wockner isn’t thrilled, which is the whole point of his demogoguing.  Yet, it isn’t unreasonable for Coloradans including Governor Hickenlooper to be thrilled about Anadarko’s announcement because we, our economy and way of life, are reliant upon petroleum.  As I wrote in my first response, Colorado like any other culture not living in the 13th century needs to have petroleum. Until we find some type of cost effective alternative, petroleum is it. Personally, I am thrilled, but I can’t speak every other Coloradans so I won’t try.

Wockner continues:

Obviously, these are two very conflicting views of the role oil should play in our economy and our future, and they raise honest questions the public needs to address: What is the actual role that oil and gas plays in our economy? Where do all the billions of dollars go?

Wockner and his Clean Water Action are opposed to fossil fuels so they are the ones in a state of conflict, which makes me wonder if Wockner is opposed to economic activity. In our economy, private companies provide goods and services that consumers want who voluntarily exchange some form of currency for products, which benefits both groups as business profits by meeting consumers’ wants and needs. Producers can earn a profit, and consumers obtain the goods and services they want. So the role of oil and gas is to provides goods and services that consumers want. The oil and gas industry then returns some of that profit to communities in the form of capital investment, charitable contributions, dividends to shareholders or anything else a private company wants. It’s not up to Wockner and his ilk to decide how the oil and gas industry spends its profits.

In Colorado, the oil and gas industry is a major economic player. Besides using fossil fuels to heat our homes (it’s -8 degrees right now), power our cars, produce precious solar panels, and make thousands of items we use every single day, here are a few facts about the economic impact of oil and gas in Colorado according to the Colorado Oil and Gas Association (COGA):

  • The OIL & GAS industry in Colorado directly employs 50,000 people and supports over 190,000 jobs in the state and provides $12.4 billion in total labor income and $24 billion in value added economic output annually; this is 9.3% of the total in the state.
  • The NATURAL GAS industry in Colorado directly employs 30,000 people and supports over 137,000 jobs in the state and $8.4 billion in total labor income and $18.4 billion in value added economic output annually; this is 7.3% of the total in the state.
  • Our industry is responsible for roughly 6% of total employment in Colorado.
  • Only the cities of Denver, Colorado Springs, and Boulder have more jobs than the State’s oil and natural gas industry.
  • In Colorado, more than 75 percent of residential homes use natural gas as their primary energy source for home heating, one of the highest shares in the nation.3
  • Colorado had more than 40,000 oil & gas wells in production.
  • Ten of the Nation’s 100 largest natural gas fields and three of its 100 largest oil fields are found in Colorado.
  • Colorado produces 1/4 of all coalbed methane in the U.S.
  • Severance tax is levied on extraction of metals, coal, oil and gas and is part of TABOR revenue base. Oil and gas pay over 90% of the state’s severance tax.
  • The total assessed values for taxable Oil and Gas property in 2010 was $6.25 billion or 5.63% of the state total

Yesterday I spent an hour talking with John Christiansen and Brian Cain of Anadarko Petroleum Corporation on my radio show. Anadarko is one of the world’s largest independent natural gas and oil exploration and production companies in the world. It had total sales revenue of just under $11 billion for 2010 according to its most recent annual financial report.

Anadarko, its employees, and the community were celebrating the ribbon cutting on their newly expanded field office in Evans, Colorado. It’s an unassuming but comfortable 46,000 square foot build out paid for by Anadarko. It’s efficient with video conferencing to save the company time and money and a modest kitchen for employees who don’t want to leave for lunch. No taxpayer-guaranteed loan here (think Solyndra) so no 300,000 square feet of “the Taj Mahal”, no spa showers with liquid-crystal water temperature displays, no conference rooms with glass walls that change from clear to smokey with the touch of a button, no robots whistling Disney tunes. When I asked why Anadarko’s new building didn’t have a spa, the response was simple, “it’s not necessary.”

Globally, Anadarko employs roughly 4,400 an increase of 10 percent since 2007 after a decline from 2006.

In Colorado, Andarako employs roughly 260 people out of Evans field office, another 100 in Brighton and couple hundred more in Denver office. The average salary is between $70,000 and $80,000. And unlike Abound Solar, Cain and Christiansen told me that Anadarko is hiring.

Because of the recent discovery of up to 1.5 billion BOE in the Wattenberg Field, Anadarko expects to invest $1 billion in Weld County alone in 2012. County Commissioner Sean Conway says the additional oil and gas activity could mean as much as $50 million in additional revenue to county coffers. This is all direct investment. The ripple effect of this economic activity will be profoundly positive for Colorado and Weld County.

Also, giving back to the community part of the mission of the oil and gas industry, which certainly shows in Weld County. At the ribbon cutting yesterday, Anadarko handed a check for $25,000 to the Boys and Girls Club of Weld County. A combination of several oil and gas companies, including Anadarko, Noble, Encana, Halliburton, and others, have provided $250,000 for the Weld Food Bank. By contrast, Abound, which has its manufacturing plant in Weld County, has received a $400 million taxpayer guaranteed loan from the DOE, and tax credits from Weld County, is not a contributor to the food bank. Vestas Blades, also with manufacturing in Weld County, has given a one time donation of $750.

But where the money goes should be irrelevant because a private company can do what it wants with its money. However, if Anadarko or any other oil and gas company mismanages its profits, can’t remain competitive, or can’t provide goods, services people want then it will go out of business (unless it gets a DOE loan). And it should.

Perhaps Colorado is “addicted” to oil because we are “addicted” to a modern lifestyle and economic activity. We’re also addicted to water and oxygen. Nothing wrong with that.

Next, I’ll address Wockner’s gratuitous attacks on Weld County and Greeley.

For fun, which of these was paid for with a taxpayer-guaranteed loan?

Lavish offices.

Lavish offices.

Evans Office

Evans Office