March 3 Colorado Energy Cheat Sheet: EPA’s McCarthy ‘good news about Gold King’; a Tesla will improve your ‘quality of life’
Filed under: Environmental Protection Agency, Legal, National Renewable Energy Laboratory, PUC, renewable energy, solar energy, wind energy
Environmental Protection Administrator Gina McCarthy: “But, the good news about Gold King is that, you know, it really was a bright color, but the bright color was because the iron was oxidizing. It meant we had actually less problem than how it usually leaks, [laugh] which is pretty constantly, and so it was only a half a day’s release of what generally comes from those mines and goes into those rivers.”
The Daily Caller’s Michael Bastasch had more on the story:
The EPA-caused spill unleashed the equivalent of “9 football fields spread out at one foot deep” for a couple hours, according to a report by University of Arizona researchers.
Mine waste from Gold King was only coming out at a rate of 112 gallons per minute in August 2014. After the spill, wastewater was coming out at a rate of 500 to 700 gallons per minute.
While there have thankfully been no reported short-term health problems from the spill, experts are worried the toxic metals, like arsenic and lead, that leaked from the mine could pose long-term health problems.
“There is a potential for such sediments to be stirred up and metals released during high water events or recreational use,” University of Arizona researchers wrote. “The metals could become concentrated in fish that live in the river and feed on things that grow in the sediments. Metals in the sediments could seep into the groundwater, resulting in impacts to drinking and irrigation water.”
And the question of culpability for the EPA remains, as a House committee finds additional evidence implicating the agency directly:
House Natural Resources Committee Chairman Rob Bishop, R-Utah, cornered Interior Secretary Sally Jewell Tuesday over an email he says contradicts her statements that a toxic mine spill the Environmental Protection Agency caused last year in Colorado was an “accident.”
The mine blowout released 3 million gallons of heavy-metal-tainted water into the Colorado Animas River and the waterways of New Mexico and Utah. Bishop’s committee recently subpoenaed the Interior Department in February to provide it with email communications between Interior and the Army Corps of Engineers.
Much of what they received back was completely redacted, Bishop said. But one email that Interior sent to the panel, unrelated to the subpoena, was revealing.
The email shows “that less than 48 hours after the blowout, your employee in Colorado talks to the EPA official in charge, and then emails all senior leadership at [the Bureau of Land Management], and basically says that EPA was deliberately removing a small portion of the plug to relieve pressure in the mine when the blowout occurred.”
ICYMI: Energy Policy Center associate analyst Simon Lomax’s latest column:
It was a rare moment of honesty from an environmental activist: “It is not easy to talk about the kind of massive changes that we need to make; about how we think, about what we eat, where it comes from, how we entertain ourselves, what kind of holidays we take,” said Kumi Naidoo, former executive director of Greenpeace International. “All of these things actually are very painful to talk about.”
Naidoo, who led Greenpeace for six years before departing late last year, made these remarks in mid-February at a climate-change forum in Germany. He was answering the question of an Icelandic official, who wanted to know why governments aren’t doing more to crack down on “meat consumption,” and other economic excesses that produce greenhouse gases. “We have to change the way we consume,” the official concluded at the end of her question.
On the same panel, three seats across from Naidoo, sat U.S. Sen. Sheldon Whitehouse (D-R.I.). As the former Greenpeace activist wrapped up his answer, the American lawmaker saw his climate and energy talking points going up in flames, and tried to get back on message.
“Let me just push back very gently on one point,” Whitehouse said, in comments first reported by The Harry Read Me File. “I don’t want to leave the impression that mankind must suffer in order to make these changes. The changes in consumption can actually be enjoyable and beneficial.”
Then he offered an example: “If you trade in your Mercedes for a Tesla, your quality of life just went up.”
Read it all here.
Have not had much on wind energy in a while, and the latest headline is somewhat revealing–wind sources acknowledge their lethal impact on birds, and propose to use technology to shut them down whenever a bird is nearby, making the energy source even more erratic and intermittent, not to mention the wear and tear of stop/start on the turbines themselves:
What if a wind turbine knew to shut down when a bird was too close? That vision is the goal of ongoing research in Golden, and birds themselves are helping to develop a solution.
The National Renewable Energy Laboratory has been conducting avian research alongside various industry partners to drastically reduce avian deaths by wind turbine collisions.
Colorado has 1,916 operating wind turbines statewide, placing it eighth in the nation for the number of turbines within a state.
Although those wind turbines accounted for only a small percentage of bird deaths annually, Jason Roadman, a technical engineer for NREL said that percentage should be zero.
“Renewable energy is something that I and a lot of people strongly believe in, so we want to make it as low impact as possible,” Roadman said. “The rates of wild bird collisions are fairly low on these solar-wind farms, but they’re not zero. So anything we can do to reduce the footprint of the negative effects of alternative energy, we’ll make every effort toward.”
Leaving the question of turbine resiliency and energy generation fluctuation aside, the admission that such measures are necessary to alleviate the threat to birds, including the heavily protected eagles and other raptors, is quite a step from a few years ago, when wind proponents minimized any such concern and sought takings extensions to prop up one of the industry’s most glaring shortcomings.
To say it’s been a rough 18 months for oil and gas would be an understatement, and the effect of the drop in commodities prices is being reflected in new figures from local businesses and communities:
Anadarko Petroleum Corp., one of the biggest oil and gas companies working in Colorado, will have only one drilling rig operating in the state during 2016 — down from an average of seven in 2015.
The Texas company (NYSE: APC), based in The Woodlands, a suburb of Houston, on Tuesday followed its peers by releasing budget figures and plans for 2016 that are a far cry from last year.
Hammered by a bust in oil and gas prices brought on by an international glut in supplies, oil and gas companies have slashed budgets, laid off employees and sold assets in the struggle to survive.
Anadarko, which has operations in the U.S. and around the world, said Tuesday it expects to spend between $2.6 billion and $2.8 billion this year, down nearly 50 percent from its 2015 budget.
About half that money, $1.1 billion, will be spent in the United States, and about half that amount — approximately $500 million — spent in the Colorado’s Denver-Julesburg Basin during 2016, according to the company.
By comparison, Anadarko said a year ago it expected to spend about $1.8 billion on its Colorado operations in 2015.
Cuts like Anadarko’s have already manifested in places heavily involved in natural resource development, like northern Colorado’s Weld County:
Weld County’s economy appears to have entered a hard skid, now confirmed by larger-than-expected downward revisions to the number of people employed in oil and gas and mining statewide.
Preliminary employment counts last month estimated the county gained a net 3,800 payroll jobs between December 2014 and last December.
But revisions based on the Quarterly Census of Employment and Wages for the third quarter from the Colorado Department of Labor and Employment out Wednesday now project the county lost 500 jobs last year.
“It is playing out as we expected. It has just been more delayed than expected,” said Brian Lewandowski, associate director of the business research division at the University of Colorado at Boulder’s Leeds School of Business.
Weld County accounted for about 90 percent of the state’s oil production last year, and oil and gas producers account for about three-quarters of employment in the mining sector, Lewandowski said.
Mining has also been hit hard:
The QCEW revisions show what was initially measured as a modest 3.9 percent year-over-year decline in mining employment is running closer to a 20.7 percent drop.
Viewed another way, the loss of 1,400 mining sector jobs last year is now estimated at closer to 7,500, a nearly fivefold increase.
And while the number crunchers characterize the information as “delayed”–due to being lagging indicators following the commodity prices dropping–the impact was within a year, not a much longer or slowed trend that plays out over time.
A similar downturn has already been seen in severance taxes in the same area, as we noted a month ago in the Cheat Sheet:
Pushing for bans on fracking or other measures to limit responsible natural resource development will only exacerbate problems at the local level, putting education, infrastructure, and other critical services at risk, on top of the drop noted here in the Denver Post due to commodity prices tanking:
Because 97 percent of Platte Valley’s budget comes from taxes paid on mineral production and equipment — a property tax known as ad valorem — McClain said his district could be looking at a budget reduction between $300,000 and nearly $1 million next school year.
How that plays out in terms of potential cuts or program impacts is yet to be seen, he said.
“You’re always concerned about your folks,” McClain said. “You worry about it taking the forward momentum and positivity out.”
It’s not just schools that are suffering. Municipal budgets, local businesses and even hospitals in mineral-rich pockets of Colorado are watching closely to see how long prices remain depressed.
Combine that with a 72.3 percent drop in severance tax revenue–down to $77.6 million this year compared with $280 million last fiscal year–and you’ll get, in the words of the Post, “the state’s direct distributions of those proceeds to cities, counties, towns and schools will be reduced from a little more than $40 million in 2015 to just $11.9 million this year.
Xcel Energy filed a new renewable energy plan with the Colorado Public Utilities Commission Monday that could more than double its portfolio of solar power in the state over the next three years.
“Our plan is all about our energy future in Colorado, and allowing our customers to choose and pay for the energy sources that they believe are best for them,” David Eves, president of Public Service Co. of Colorado, said in a statement.
The plan would add 421 megawatts of new power from renewable sources, enough for 126,300 homes, over the next three years. The bulk of that amount, 401 megawatts, would come from solar.
Xcel Energy, which currently obtains more than 22 percent of its power from renewable sources, said it is on track to meet or beat the state mandate of 30 percent from renewable sources by 2020.
The solar industry, however, is not impressed with Xcel, saying the utility should do more to encourage distributed generation:
But one leading solar advocate questioned the utility’s sincerity, given that Xcel, in a separate rate case, has asked for cuts to what it pays customers who put solar power onto the grid.
“Xcel’s view of the energy future is not the only one that Coloradans should consider. The public really needs to have a say here,” said Rebecca Cantwell, executive director of the Colorado Solar Energy Industries Association.
Xcel currently offers to take on 2 megawatts of additional solar power at the start of each month, but that capacity is reserved within 15 to 20 minutes.
“We don’t think there should be an allocation, a ‘Mother may I have some capacity’ system,’ ” Cantwell said. “The industry is ready to play a much bigger part in Colorado’s energy future.”
Solar remains captive to the need for government mandates, rebates, handouts, and incentives to spur growth beyond the natural market preference of customers desiring to install the preferred energy source. The cost of panels may be declining (again, due in no small part to taxpayer-funded R&D grants, state and federal mandates, and other subsidies), but the cost of a system remains daunting.
If you have any doubt about the extent of government programs to encourage solar and other renewables, take a look of this list compiled by the Department of Energy. It lists 129 programs for Colorado alone.
As for the resources necessary for renewables and battery storage, here’s a new report from the Institute for Energy Research, as they show that renewables increase dependency on foreign sources:
One of the common reasons people claim to support wind and solar technologies is to reduce dependence on foreign sources of energy. For example, green energy supporter Jay Faison told the Wall Street Journal “If we expand our clean energy technologies, we’ll create more jobs, reduce our dependence on foreign sources of energy…”[i] The problem is that green energy actually increases reliance on imports instead of reducing imports.
Green energy technologies are dependent on rare earth minerals and lithium for batteries–both of which are primarily imported into the United States. Most of the world’s rare earth minerals are produced in China (85 percent); and that country supplies the United States with most of its rare earth imports (71 percent). The United States only produces 24 percent of the rare earth minerals that it needs.[ii] In 2013, the United States imported 54 percent of the lithium it used, with Chile and Argentina supplying 96 percent of those imports.[iii] Some believe that lithium may be the “new oil”, eclipsing oil as a source for geopolitical and economic power.[iv] Clearly, Tesla, who is building a gigafactory in Nevada to produce lithium-ion batteries for its cars and Powerwall storage device, needs access to low-cost lithium. In contrast to these figures, the United States now imports only 27 percent of the oil it uses domestically.[v]
And about that reliability argument:
Green energy is so unreliable and intermittent that it could wreck the power grid, according to industry and government experts.
The U.S. Federal Energy Regulatory Commission (FERC) is currently investigating how green energy undermines the reliability of the electrical grid. FERC believe there is a “significant risk” of electricity in the United States becoming unreliable because “wind and solar don’t offer the services the shuttered coal plants provided.” Environmental regulations could make operating coal or natural gas power plant unprofitable, which could compromise the reliability of the entire power grid.
“The intermittency of renewable sources of electricity is already threatening reliability in Britain,” Myron Ebell, director of the Center for Energy and Environment at the libertarian Competitive Enterprise Institute, told The Daily Caller News Foundation. ”This is because there are so many windmills that conventional power plants are being closed as uneconomic and so when the wind doesn’t blow there is not adequate backup power available. To avoid blackouts, the government is now paying large sums to have several hundred big diesel generators on standby. If this sounds crazy, it is.”
November 12 Colorado Energy Cheat Sheet: Colorado hit hard by CPP; Bennet defends pro-Keystone stance; CSU report rejects “sky-is-falling” contamination claims
Filed under: Archive, CDPHE, Environmental Protection Agency, Hydraulic Fracturing, Legislation, National Renewable Energy Laboratory, New Energy Economy, regulations
Colorado would be the 18th hardest hit state, and fourth most expensive for the cost of carbon reduction under the Environmental Protection Agency’s Clean Power Plan, according to a new report from Fitch Ratings:
Wide-ranging voices—in politics; in business; consumer advocates like our coalition—have been warning of the potentially crippling costs of the U.S. Environmental Protection Agency’s soon-to-be-implemented Clean Power Plan. Its ripple effects will be felt nationwide, and Colorado is by all indications squarely in harm’s way.
As we have contended for some time now, the proposed federal mandate for air standards will impact every type of consumer—residential, small business, agricultural and industrial—in every community in Colorado. That includes consumers served by public utilities, municipal providers and rural cooperatives. And the changes to Colorado’s statewide power generation contemplated by the EPA’s mandates may ultimately cost many billions of dollars.
Rather than heed or, at least, consider some of these urgent concerns, however, defenders of the oncoming Juggernaut have sought in many cases to dismiss the criticism as coming from interests that are supposedly too close to the debate. Stakeholders involved in energy development of fossil fuels, for example, or power generation, are accused of having a vested interest and thus, presumably, are less than objective. Fairly or not, policy debates often turn on such considerations.
Well, now, another authoritative voice has entered the fray, and this time it is one without a discernible horse in the race. It is the voice of a truly neutral arbiter—one of the financial world’s “big three” credit-rating agencies—and it is sounding the alarm on the Clean Power Plan.
Fitch Ratings’ new report, “The Carbon Effect 2.0,” released just weeks ago, raises troubling concerns about the impact of the Clean Power Plan on the financial stability of the nation’s electric utilities. More troubling still, in the report’s state-by-state assessment, Colorado is among those facing the most formidable challenges, and potentially steepest costs, in complying with the Draconian EPA rules.
Governor John Hickenlooper continues to maintain his position that Attorney General Cynthia Coffman should defer to the governor on the matter of the AG’s lawsuit over the Clean Power Plan:
On his petition to the state Supreme Court to review Attorney General Cynthia Coffman’s authority to sue over the federal Clean Power Plan:
“I think the way the system’s meant, was designed, is that the governor and the attorney general should be consulting together on legal issues facing the state. But ultimately, the attorney general needs a client, and I think the governor was intended to be that voice, to speak for the agencies, the departments, to speak for the people. And I think if the attorney general and the governor don’t agree, my reading and [that of] the lawyers in our office is that this was intended ultimately to be the governor’s decision.”
Hickenlooper filed the petition to the Colorado Supreme Court last week.
The eco-inquisition is here, and the practice of selling environmental indulgences won’t be far behind:
Executives at publicly traded companies like Exxon Mobil may soon be talking more about climate change. Financial regulators are taking a closer look at how these companies disclose the impacts of climate change.
New York Attorney General Eric Schneiderman said Monday that Peabody Energy didn’t tell its investors all the financial risks from climate change and potential regulation. Peabody Energy, which owns a mine in Colorado, admits no wrongdoing, but it says it will now make disclosures that accurately and objectively represent climate impacts.
Methane regulations touted as saving money for companies, say regulators and companies hired to find methane leaks:
“What that means to the industry is substantial lost revenues,” he said.
He estimated that loss at about $1.2 billion a year even at today’s low natural gas prices.
Methane also is a potent greenhouse gas, and typically leaks in combination with volatile organic compounds and other pollutants. With that in mind, Colorado’s Air Quality Control Commission last year passed what’s known as Regulation 7, imposing the nation’s first rules specifically targeting methane emissions by the industry. Now the Environmental Protection Agency and Bureau of Land Management are considering rules targeting methane at the national level.
“Colorado … is the leader in the country on this issue by passing and enacting Regulation 7. We’re paying real close attention to how that’s going because there are several rulemakings on the federal level,” Von Bargen said.
U.S. Senator Michael Bennet defended his pro-Keystone XL stance even as his party’s leader, President Barack Obama, went the other way on the project last week:
Democratic U.S. Sen. Michael Bennet stood behind his vote earlier this year in favor of the proposed Keystone XL oil pipeline after the Obama administration rejected it on Friday after seven years of study and contentious debate.
“For years, the Keystone XL pipeline has been overhyped on both sides of the debate,” Bennet said in a statement to The Colorado Statesman. “The number of jobs it would create and the amount of carbon emissions it would facilitate have both been exaggerated.”
The proposed 1,200-mile pipeline would have transported 800,000 barrels of tar sands oil a day from Alberta, Canada, to Nebraska and ultimately on to refineries on the Gulf Coast of Texas. Bennet voted for a Senate bill approving the project in January.
“Based on scientific analyses that showed building Keystone XL would have little or no bearing on whether our nation will materially address climate change, I voted to move forward with the pipeline,” Bennet added. “The president vetoed the bill that Congress passed and has now administratively rejected the project. This is an issue on which the president and I disagree.”
A new CSU report concludes that, contrary to the popular line put forward by anti-fracking activists and other environmentalists, water-based contaminants from the fossil fuel industry aren’t seeping into wells in northern Colorado:
A new Colorado State University report says there is no evidence water-based contaminants are seeping into drinking-water wells over a vast oil and gas field in northeast Colorado.
A series of studies, led by CSU civil and environmental engineer professor Ken Carlson, analyzed the impact of oil and gas drilling on groundwater in the 6,700-square-mile Denver-Julesburg Basin, which extends between Greeley and Colorado Springs and between Limon and the foothills.
The studies were done under the auspices of the Colorado Water Watch, a state-funded effort started last year for real-time groundwater monitoring in the DJ Basin. The basin shares space with more than 30,000 active or abandoned oil and natural gas wells, say CSU researchers.
They primarily looked at the 24,000 producing and 7,500 abandoned wells in the Wattenberg Field, which sits mainly in Weld County.
“We feel that our results add to our database of knowledge,” Carlson said. “There isn’t a chronic, the-sky-is-falling type of problem with water contamination.”
Methane contamination was found in a small percentage of older wells, but according to the story, “it’s not toxic and isn’t a huge factor in terms of drinking-water safety.”
Many of the most well-known National Parks in the western United States would violate the new 70 ppb ozone regulation finalized last month, with the most egregious violator located along the Colorado-Utah border:
But national parks are among the worst offenders, with one maintaining levels of more than 100 ppb.
The 26 offenders are mainly in the West, with only a handful in the East, where coal-fired power plants dot the landscape.
The biggest violator is Dinosaur National Monument, home to 1,500 dinosaur fossils and a popular white-water rafting destination on the Colorado-Utah border. Its ozone level is 114 ppb. The runner-up at 90 ppb is the 631-square-mile Sequoia National Park in Northern California, a pristine forest boasting 3,200-year-old trees that are among the tallest in the world.
The Grand Canyon? It barely squeaks by at 69 ppb.
In all, 11 states have national parks that are in non-compliance with the new ozone standard: Arizona, 3; California, 9; Colorado, 2; Connecticut, 3; Illinois, 1; Maine, 1; Massachusetts, 1; Nevada, 1; New Jersey, 2; Pennsylvania, 1; and Utah, 2. Ozone levels are calculated over a three-year period.
The Grand Canyon narrowly missed violating the rule when the EPA went with the 70 ppb level instead of the lower end of the 65-70 range suggested in earlier drafts of the rule.
Energy Policy Center Director Amy Oliver Cooke has fun talking energy, especially when wearing a hot pink “Mothers In Love with Fracking” t-shirt. Thanks to Tom Barry of The Villager for this photograph and his article on the American For Prosperity (AFP) event that featured Dick Morris. AFP invited Amy to be the warm up act to discuss Obama’s energy policy.
The Colorado School of Public Health (CSPH) at the University of Colorado recently announced an article that will be published this month in the journal Science of the Total Environment. The article is based on a study of air pollution resulting from oil and gas development (including hydraulic fracturing or “fracking”) in Garfield County. According to the announcement, the article will reveal findings of benzene and other “potentially toxic petroleum hydrocarbons” at concentrations potentially hazardous to human health. But before this study, or any similar study, can be taken as a basis for alarm, several questions need to be answered: What are these “potentially toxic” chemicals? Where do they come from? And how dangerous are they really?
To answer these questions, it will be helpful to focus on just one chemical: in this case, benzene—the chemical most often associated oil and gas development. Focusing on benzene will also be helpful in evaluating the CSPH study, because, according to the announcement, benzene was the “the major contributor to lifetime excess cancer risk” found in the study.
One reason benzene is so often associated with oil and gas development is that it’s a natural hydrocarbon—like methane, propane, octane, and the hundreds of other chemicals in the mixtures we call “crude oil” and “natural gas.” Consequently, benzene is also found in gasoline, diesel fuel, and engine exhaust, which further increases the presence of benzene near oil and gas development. Lastly, because benzene has desirable chemical properties, it is also separated from crude oil for use in industrial applications, including—among many other things—use as an additive in fracking fluids.
Given the uses above, it should not be surprising that benzene can be found everywhere, not just near oil and gas development. According to the toxicology profile provided by the US Department of Health and Human Services, “Benzene is ubiquitous in the atmosphere.” Not only does it come from tailpipes, but also cigarettes, volcanoes, forest fires, and even camp fires. Government agencies, however, are usually not alarmed by the benzene levels found in our daily lives, because they recognize that the mere presence of a toxin (the fact that a laboratory can physically detect it) does not automatically pose a threat to public health: It is equally important to determine what concentrations can actually do harm.
At what level, then, does benzene become a problem? The truth is, we don’t know. With limited data, the EPA does the best it can to estimate relative risks at various levels of exposure. In the case of benzene, the EPA uses a 25-year-old study (published in 1987), in which workers were exposed to concentrations of benzene measured in parts per million (ppm)—concentrations literally thousands of times higher than the levels the EPA ultimately tries to estimate. The EPA then performs a linear extrapolation (i.e. draws a best-fit line through the data) to estimate a concentration of benzene that will result in 10 additional cancer cases (not to be confused with cancer deaths) per million people exposed. This is essentially the same as determining a level at which the cancer risk for an individual increases by one-thousandth of a percent (0.001%). When considering studies like the CSPH study, it can be more useful to think of the increased cancer risks on the individual level because the exposures in such studies are localized and rarely affect more than a million people—typically they affect a few hundred or less.
For benzene, the EPA estimates that a 0.001% increase in cancer risk corresponds to exposures of 0.4 parts per billion (ppb) in the air and 10 ppb in drinking water. For even greater caution, the EPA set the actual limit on drinking water, enforceable under the Safe Drinking Water Act, at 5 ppb.
While a 0.001% risk may seem small to begin with, there is one critical assumption that needs to be remembered when using these EPA estimates: the calculated risks assume a person will continue to be exposed to the same level of a toxin or carcinogen for their entire lifetime. This is especially unlikely in the case chemicals like benzene, because it is a biodegradable substance—and, in the case of the CSPH study, it is produced by temporary activities.
Also worth considering is the fact that a wide range of uncertainty results from the process used to generate the EPA estimates. Within the range of uncertainty, the EPA selects the most conservative (i.e. the most protective) estimate to establish as the official estimate. Thus, as explained in the EPA calculations, there is an “equal scientific plausibility” that the real levels of benzene corresponding to a 0.001% increase in cancer risk could actually be more than 3-times higher than the current estimates (1.4 ppb in the air and 35 ppb in the water).
These are important considerations when evaluating studies like the CSPH study, since these studies often express their findings in relation these EPA estimates. Without a proper understanding of what these estimates represent, they can give an exaggerated perception of the relative risks involved. Consider, for example, the EPA report that found benzene contamination in Pavillion, Wyoming. In press releases, it was announced that benzene was found at levels 49 times higher than the EPA limit. This, no doubt, caused considerable alarm for the public—but few realized that this represented a 0.02% increase in cancer risk, again, assuming a lifetime of exposure at that level. However, just six months later, the benzene level had fallen 40%. Adjusting for this rate of biodegradation, the total increased cancer risk would have been only 0.0005%. And while this level represents a very low risk, it’s also worth mentioning that this level was found in a deep monitoring well, specifically used to detect contamination—in other words, not a single person was ever actually exposed to this level of benzene. Unfortunately, none of these considerations, are quite as attention-grabbing as the statement: “Benzene found at levels 49-times above Safe Drinking Water Limit!”
Just as it is important to understand what EPA limits represent, it is also important to consider how the increased risks from a particular activity relate to increased risks from air pollution in general. The CSPH study calculated an increased cancer risk of 10 cases per million people living near oil and gas development. But, when compared to the average increased cancer risk nationwide—due to factors such as automobile emissions and industrial activity—the numbers are not quite as alarming. According to the EPA’s most recent National-Scale Air Toxics Assessment, the average increased cancer risk nationwide due to air pollution is 50 cases per million. The risk in Denver is even higher (almost 80 per million) simply because it is an urban environment. Garfield County, on the other hand, has a risk of only 20 per million. Thus, a person living near oil and gas development in Garfield County will experience a cancer risk of roughly 30 per million, far below the national average, and less than half the risk that results from living in an urban environment.
Benzene and other air pollutants should not be ignored when discussing oil and gas development. But it is important for the public to realize that the limits set by the EPA reflect concentrations that present very small—though perhaps not insignificant—risks, and that these risks are comparable to the risks associated with automobile emissions, urban living, and industrial activities in general.
It should also be remembered that, for the purposes of this post, benzene was used as an example because it is one of the most dangerous and most common chemicals associated with oil and gas development; however, the same considerations and relative risks apply the many other chemicals associated with oil and gas development—including xylenes, trimethylbenzenes, aliphatic hydrocarbons, and other compounds that will likely to receive attention in the CSPH study.
Part three in a series responding to a Denver Post guest editorial titled “Is Colorado addicted to oil?” from Gary Wockner of Clean Water Action.
The impetus for Wockner’s column seems to be a comment from Governor John Hickenlooper regarding the recent announcement from Anadarko Petroleum about increased investment in the Wattenberg Field due to the discovery of an additional nearly 1.5 billion BOE (barrels of oil equivalent). Hickenlooper said, “We are thrilled to see the company plan a significant investment in Colorado.”
In true Sierra Club elitist fashion, Wockner asks “Addicted or thrilled? Which is it?” As if to suggest that both are bad.
In the first two posts I answered several of Wockner’s ”Is Colorado addicted to oil?” and the role that the oil and gas industry plays in Colorado’s and Weld County’s economy. Now, I’ll address the pot shots Wockner takes at Greeley and Weld County.
Full disclosure: I live in Greeley, the county seat of Weld County. So this is personal. And something I wouldn’t do originally, I’ll answer the “thrilled” question.
In a poorly constructed column, Wockner relies old data and provides no analysis, just unflattering questions directed at Weld County. (He doesn’t like us.)
Weld County already has more oil and gas wells — about 18,000 — than any other county in the United States. So, if oil and gas is good for the economy, shouldn’t Weld County have one of most thriving economies in America?
Weld County’s unemployment rate, poverty rate, home mortgage “underwater” rate, and bank failure rate are well above the state’s average, and Weld County’s home foreclosure rate has been one of the highest in the nation. In addition, Weld County and Greeley (the county seat) have serious problems with crumbling schools and roads, an issue that is supposed to be addressed by money from property and severance taxes on oil and gas. What’s wrong with this picture?
What’s wrong with this picture? Everything, especially Wockner’s guilt by association fallacy. It’s sophomoric at best from a guy who has a doctorate. He provides no quantitative facts except the number of wells. His schools, roads, and foreclosures argument is a red herring. Apparently, oil and gas reserves should equate to economic paradise with streets paved with gold. Sorry, that’s only the Saudi royal family.
First, let’s update with a few economic facts about Weld County, something that escaped Wockner’s analysis. At the end of September The Denver Economy Blog reported on the recently released Bureau of Labor Statistics County Employment and Wages Summary:
The average weekly wage exceeded the national change of 5.2 percent in Denver, Douglas, Larimer and Weld Counties. weld [sic] County showed the largest year over year growth with average wages increasing 7.6 percent….
Weld County’s increase placed it at 22nd in the nation for wage growth. Douglas County placed 34th in the nation.
Compared to the nation’s employment growth rate of 1.3 percent, Denver, El Paso and Weld Counties placed higher with year over year employment growth rates of 2.0 percent, 1.4 percent and 3.6 percent, respectively.
Weld County’s growth placed it 12th in the nation for employment growth. Denver placed 65th. On the other hand, total employment in Douglas County and Jefferson County grew by 06 percent and 0.5 percent, respectively. All counties surveyed showed growth in total employment.
Year-over-year change in average weekly wage, by county:
- Denver 5.0
- Douglas 7.1
- El Paso 2.9
- Jefferson 3.7
- Larimer 5.3
- Weld 7.6
Year-over-year change in total employment, by county:
- Denver 2.0
- Douglas 0.6
- El Paso 1.4
- Jefferson 0.5
According to Weld County Commissioner Sean Conway, Wockner’s dismal portrayal of Weld County relies upon old headlines to create an image of an economic hellhole. But Conway lives in and represents a much different Weld County. In fact, Conway’s been told that “without Weld’s energy cluster economy the state’s unemployment rate would be a full percentage higher.”
Weld County did suffer the closure of several community banks including New Frontier Bank. That had more to do with poor management and our agriculture industry and real estate. Sadly, it coincided with the new Ritter Rules for oil and gas, which slowed the permitting and drilling process. Investment in Colorado dropped significantly. People were laid off.
Weld County like many throughout the country continues to endure through difficult economic times. And we’ve done it without raising property taxes, no county sales tax, and no debt due in large part to our oil and gas industry.
These resources are not an economic panacea, but without them Weld County and the state of Colorado would be in a financially precarious situation. According to Conway the State Land Board received $100 million in revenue in 2010 from its land leasing operations, 70 percent of which came from Weld County, and that money went directly to the state’s K-12 education fund. So those who want funding for K-12 should be “thrilled” with Weld County’s oil and gas industry.
Furthermore, the $6-7 million in severance taxes that was supposed to come back to the county via the Department of Local Affairs (DOLA), instead remained in state coffers to help balance the state budget. Thank you again to Weld County for sharing its oil and gas profits with the rest of the state.
In 2008, Weld County received roughly $56 million from oil and gas severance taxes that went straight to county coffers. That money was used to help Weld County through the Great Recession. Weld County didn’t go into debt, didn’t raise taxes, and didn’t layoff a slew of county employees. We did balance our budget.
The oil and gas industry is also a good corporate neighbor as the Colorado Oil and Gas Association reports:
Oil and gas companies are investing in rural infrastructure such as roads, sewer, and water lines in Weld County—the county with more oil and gas wells than any other county in the nation according to Weld County Commissioners. And where infrastructure investments are made, jobs and development soon follow.
Halliburton officials confirmed the company’s plans to expand their holdings south of Fort Lupton with the addition of a $20 million facility that could eventually double the number of employees currently on staff. Key to Halliburton’s expansion plans is $2.4 million in water and sewer upgrades along Weld County Road 27, extending service 2.5 miles down to Weld County Road 8.
“It is probably the biggest thing to happen for the city in probably 50 years,” Fort Lupton Mayor Tommy Holton said. “Because it adds 2.5 miles of water and sewer, and close to 2,000 acres of property that could be developed with industry.”
And industry giants like Halliburton aren’t the only companies making a difference in the communities in which they do business.
When Conquest Water Services, founded in 1993 by Bruce White and Dale Butcher, petitioned Weld County to build a new water disposal and recycling facility at County Road 74 and Highway 392, they learned about a Briggsdale School District bus stop at that intersection.
Recognizing a need for a safer bus stop, Conquest built, at its own expense, a new one on a one-acre fenced parcel with a safe gravel turn-around which it maintains and leases to Briggsdale School District for $1.00 a year. “We understand the concerns of neighbors, and we do everything we can to be good neighbors,” said Conquest co-founder Bruce White.
No question that in the past Weld County had problems with foreclosure rates, but the most recent data from DOLA shows how Weld’s foreclosure rate has gone down dramatically from one in every 66 homes in 2006 to one in every 269 homes through the second quarter of 2011. The state average is one in every 365, but according to DOLA the frontrange isn’t the problem:
Adams County reported the highest foreclosure rate of the metropolitan counties, although all of the top ten counties with the highest foreclosure rates were found outside the metropolitan areas including: Park, Grand, Gunnison, Garfield and Archuleta, among others.
As for schools, some Weld Districts have problems, including my own but that has NOTHING to do with the oil and gas industry. Wockner equates money with good schools and nothing could be further from the truth. If money were the only factor, Washington D.C. would be graduating rocket scientists and Utah wouldn’t graduate anyone.
As for roads, Weld County is roughly 4,000 square miles, and drivers enjoy well-maintained county roads especially first responders. According to Weld County Sheriff John Cooke response time has dropped by half since 2003 due to the increase in paved roadways and that is due, in part, to revenue from oil and gas.
It’s obvious that the Fort Collins-based Wockner rarely ventures east of I-25 unless it’s in an airplane. If he did, he might have an appreciation for how Weld County encourages oil and gas development without sacrificing quality of life — surface rights and subsurface/mineral rights peacefully co-exist here. And that seems to drive the anti-fossil fuel crowd nuts.
For our county, money is in the land. Greeley Mayor Tom Norton said it best, “wealth is in the ground, and you’ve got to get it out to create more wealth,” whether that’s water, agriculture, mining, or fossil fuels.
Wealth isn’t just money. It’s our way of life. It’s our people. And that includes the oil and gas industry. I wouldn’t live anywhere else.
So I’ll answer Gary’s question, I’m thrilled with additional investment in Weld County’s oil and gas resources. And I’m in good company.