January 13 Colorado Energy Cheat Sheet: Oil and gas drive Colorado’s economy, but outlook uncertain; Western Slope feels effects of regulation; WOTUS repeal?

Oil and gas development contributes a rather large percentage to Colorado’s economic condition, and new numbers confirm its continued importance to the state:

A new economic report shows that oil and gas development contributed billions to Colorado’s economy in 2014 generating benefits that researchers conclude “impact every citizen in the state.”

Prepared by the Business Research Division of the Leeds School of Business, University of Colorado Boulder, for the Colorado Oil and Gas Association (COGA), the report details how oil and gas development contributed $31.7 billion in total economic impact to Colorado’s economy in 2014, along with “supporting 102,700 jobs and $7.6 billion in compensation.” From the report:

“The oil and gas industry, along with nearly all extraction industries, inherently provides substantial economic benefits due to its integrated supply chain, high wage jobs, and propensity to sell nationally and globally. Much of Colorado’s oil and gas is sold outside of the state, contributing wealth to owners, employees, governments, and schools, all of which are beneficiaries of oil and gas revenues.” emphasis added

Energy in Depth has a complete review of the report’s findings.

The state’s oil and gas development would be crippled if newly proposed ballot measures calling for a ban on hydraulic fracturing and other regulatory limits are passed in 2016.

***

Lower oil commodity prices–a drop from $90 per barrel in 2014 to roughly $30 per barrel in January 2016 means great prices at the pump, but not good news for Colorado’s oil and gas workers:

KUSA – Oil is in an all-out freefall, dropping from roughly $90 dollars a barrel at the end of 2014 to just more than $30 per barrel Tuesday.

It’s enough to make you wonder if the industry is starting to panic.

Colorado Oil and Gas Association president and CEO Dan Haley said when commodities drop, challenges emerge.

“You’ll see some restructuring, you’ll see some tightening of jobs,” Haley said, adding that in 2015, about 2,000 people lost their jobs due to falling oil prices.

The full fallout is not likely to be known when or if the price has hit bottom, or begins to rebound, in the short or long term. Rig numbers are down and students at Colorado School of Mines are worried about the future of the industry, according to the article.

***

A report on job creation tied to a “100% renewables” future is looking a little damaged, according to the folks at Energy in Depth:

A Stanford professor who claims a transition to 100 percent renewables would be a major job creator has scrubbed his website of data showing significant long-term job losses from such a plan, according to a new review by Energy In Depth. Online records show that the professor, Dr. Mark Jacobson, edited his documents just hours after an Energy In Depth report revealed how the transition to 100 percent renewables would cause a net loss of more than 1.2 million long-term jobs, based on data pulled directly from Dr. Jacobson’s website.

The decision to alter his own data could raise additional questions about Dr. Jacobson’s plan for a 100 percent renewables energy system, a plan that has already faced significant criticism from the scientific and environmental communities.

Even if the jobs were there, as Dr. Jacobson contended, not everyone on the left is on board the “100% renewables” bandwagon:

Earlier this week, Dr. Jacobson granted a separate interview to the left-wing blog Daily Kos, which gave him a forum to respond to Energy In Depth’s report. But Dr. Jacobson likely did not anticipate another Daily Kos blogger criticizing his 100 percent renewables plan as impractical. In a comment posted to the article including Dr. Jacobson’s interview, an environmental blogger said that “no electric utility is ever going to adopt Jacobson’s plan” because, among other things, the “wind power component of Jacobson’s plan cannot be relied upon for reliable electric power generation and supply.”

***

Two Colorado Republicans reacted to President Barack Obama’s final State of the Union address and in particular the plight of Colorado’s Western Slope communities hit hard by the administration’s regulations:

U.S. Rep. Scott Tipton, R-Colo., whose 3rd Congressional District trails the rest of the state in the economic recovery, said the president would do well to visit his district.

“I would invite him to visit Craig or Delta,” Tipton said in an interview. “They have lost good-paying jobs and are struggling right now.”

Both communities in Colorado’s 3rd Congressional District have been hard-hit by coal-mine closures. Arch Coal, a major coal supplier and employer on the Western Slope, declared bankruptcy on Tuesday, before the speech.

“The president talked about significant government interference in the marketplace that will most likely imperil jobs on the West Slope of Colorado,” said U.S. Sen. Cory Gardner, R-Colo.

***

Speaking of Arch Coal’s bankruptcy:

Arch Coal Inc.’s bankruptcy filing Monday signals that the coal industry’s shakeout is entering a crucial phase, which will result in more small, unlisted mining companies, record numbers of mines for sale and lower wages for workers.

Over a quarter of U.S. coal production is now in bankruptcy, trying to reorganize to cope with prices that have fallen 50% since 2011, battered by competition from natural gas and new environmental rules. Arch, the biggest domino to fall so far, is trying to trim $4.5 billion in debt from its balance sheet.

Competitors Walter Energy Inc., Alpha Natural Resources Inc., and Patriot Coal Corp. all filed for court protection last year.

But bankruptcies only spell death for current corporate structures, not necessarily the mines they operate. And the U.S. still gets 34% of its electricity from coal, according to the Energy Information Administration, and that number is still expected to be around 30% by 2030. “The question is, what is that 30% going to look like?” says Steve Nelson, chief operating officer at Longview Power LLC, a 700-megawatt coal-fired plant in northern West Virginia.

Market-driven changes are good–the transition from coal-heavy electricity to natural gas is not a problem, and beneficial to the environment–when done without government mandates. Onerous regulations designed to put coal out of commission, from fuel switching initiatives in Colorado to the Environmental Protection Agency’s Clean Power Plan, are not beneficial to the country’s economy and to the individuals and communities impacted by layoffs and dislocation, as well as skyrocketing residential electricity rates.

***

Should be an interesting event and will definitely address some of the impact to Colorado of recent commodity downturns in oil:

By: Vital for Colorado
Event Description
Join us in discussing lifting the U.S. Oil Export Ban and what it means to Colorado. Our esteemed panel includes U.S. Representative Ed Perlmutter (D) CO and U.S. Representative Ken Buck (R) CO, Christopher Guith, U.S. Chamber of Commerce’s Institute for 21st Century Energy, Geoff Houlton, Dir. of Commodity Fundamentals Anadarko Petroleum Corp., John R. Grizz Deal, CEO IX Power Clean Water, and Craig W. Van Kirk, Professor Emeritus Petroleum Engineering Colorado School of Mines. This is a free event but registration is encouraged.

WHEN
Thursday, January 21, 2016 from 5:30 PM to 7:30 PM (MST) – Add to Calendar
WHERE
Colorado School of Mines Green Center – Bunker Auditorium – 924 16th Street Golden, CO 80401 – View Map

The Independence Institute is not affiliated with the event.

***

The EPA’s Waters of the United States rule is facing legislative repeal, subject to President Obama’s veto:

House lawmakers are poised to pass legislation repealing what is probably the Environmental Protection Agency’s (EPA) most hotly contested regulation: an attempt to expand its authority over bodies of water across the country.

The House will vote Wednesday on a bill that would repeal the EPA’s so-called Clean Water Rule under the Congressional Review Act — a law that allows Congress to vote down executive branch regulations. EPA’s water rule has been heavily criticized by lawmakers who see it as a huge expansion of government power and could mean more regulations for private landowners.

“We want them to go back and do a new rule,” Ohio Republican Rep. Bob Gibbs told The Daily Caller New Foundation in an interview. Gibbs sent a letter to House leadership last year asking them to defund EPA’s water rule in the 2016 budget bill.

The Senate passed a bill repealing EPA’s water rule in November, sparking huge outcry from environmentalists who support more federal control over bodies of water. The House is likely to pass the repeal with bipartisan support, sending it to President Barack Obama.

Colorado Energy Cheat Sheet, Christmas Edition: WY report finds fracking ‘unlikely’ in contamination at Pavillion; EPA spill report gives agency a pass; solar industry acknowledges reliance on tax credits

Energy In Depth picks up on the state of Wyoming’s long-delayed and much-expected report on possible fracking-related contamination in Pavillion, Wyoming as alleged by activists and theorized by the Environmental Protection Agency:

The Wyoming Department of Environmental Quality (DEQ) has just released the results of its 30-month investigation into water contamination in Pavillion, Wyoming, and it has concluded that hydraulic fracturing is unlikely to have been the cause. As the report explains,

“Evidence suggests that upward gas seepage (or gas charging of shallow sands) was happening naturally before gas well development.

It is unlikely that hydraulic fracturing fluids have risen to shallower depths intercepted by water- supply wells. Evidence does not indicate that hydraulic fracturing fluids have risen to shallow depths intersected by water-supply wells. The likelihood that the hydraulic fracture well stimulation treatments (i.e. often less than 200 barrels) employed in the Pavillion Gas Field have led to fluids interacting with shallow groundwater (i.e. water-supply well depths) is negligible.” (emphasis added)

As the Casper-Star Tribune put it,

“Samples taken from 13 water wells in 2014 detected high levels of naturally occurring pollution. Test results showed little evidence of contaminants associated with oil and gas production.”

The cost to taxpayers was fairly large, with the state of Wyoming having to pick up from the EPA’s abandoned efforts to link fracking and contamination:

A 30-month state investigation costing more than $900,000 concludes fracking is unlikely to have contaminated drinking water east of Pavillion but leaves many other questions unresolved about the role natural gas operations may have played in polluting the water.

Samples taken from 13 water wells in 2014 detected high levels of naturally occurring pollution. Test results showed little evidence of contaminants associated with oil and gas production.

Those findings, released Friday as part of a report by the state Department of Environmental Quality, come almost four years to the day since the U.S. Environmental Protection Agency released a draft report tentatively linking fracking to polluted water outside this tiny central Wyoming community.

EPA ultimately turned over its investigation to the state in 2013, fearing, as a Star-Tribune report later showed, that it could not defend its initial conclusion.

Not that these conclusions will dissuade anti-fracking activists, who will continue to cite Pavillion even after the determination the connection was “unlikely”:

The DEQ report left several key questions unresolved. While fracking was ruled out as a likely source of contamination, the DEQ report did not completely exonerate Encana Corp., the Canadian company that operates the Pavillion gas field.

Regulators said more research is needed to determine if gas wells have served as a pathway for contaminants reaching drinking water sources. And they noted additional examination is needed of disposal pits in the area, where drilling mud and cuttings have been stored for decades and could have leaked into the groundwater.

But in a sign of Pavillion’s complexity, they said the area’s unique geology might also be to blame. Pavillion’s gas bearing formations are shallow, permeable and relatively close to formations that produce drinking water.

After 30 months, there is some clarity, but Pavillion will remain a contentious narrative as anti-fractivists push forward across the country and in Colorado next year.

***

Current and former Colorado politicos chime in on the Paris climate change conference:

Former Colorado Sen. Timothy Wirth, known for organizing the 1988 Hansen hearing that helped propel the issue of climate change to national attention, said the Paris agreement marks a turning point in the international community’s commitment to fighting global warming.

“The fact that every country has agreed and nobody is denying the science means that this agreement has a very important science base, which did not occur before, with a real strong consensus around the science,” Wirth said.

Rep. Scott Tipton, R-Cortez, said the Paris agreement would have little realistic impact on limiting some of the world’s biggest polluters and was instead a distraction from more pressing foreign policy issues.

“Once again, the president is attempting to give away the barn by forcing Americans to shoulder the cost for a climate deal that does nothing tangible to limit the world’s biggest polluters like China, India and Mexico,” Tipton said. “The American people would be far better served by an administration that is focused on addressing the national security threats posed by ISIS instead of finding new ways to further punish responsible American energy producers and drive up energy costs on American families.”

***

Looks like the EPA is trying to skip out on responsibility for the poisonous Animas River spill it triggered in southwest Colorado back in August, according to The Daily Signal:

In their report, the EPA claims it was engaged in only “careful scraping and excavation” with a backhoe outside the mine. “Just prior to finishing, a team noticed a water spout a couple of feet high in the air near where they had been excavating.”

The report goes on to say that the spout (that they just happened to notice) quickly turned into a gusher of yellow toxic water.

It seems the EPA would have us believe the mine erupted on its own (which is like arguing, but, Your Honor, I was just carrying the gun when it went off all on its own!).

The EPA’s report goes on to allege that the mine entrance (or adit) was larger than they “anticipated,” and the “fact that the adit opening was about 2 times the assumed 8 to 10 foot maximum adit height resulted in a closer than anticipated proximity to the adit brow, and combined with the pressure of the water was enough to cause the spout and blowout.”

In other words, the mine did it!

Is it possible that the spill was caused by the EPA being careless? Nope. The authors claim they were digging “to better inform a planned consultation” scheduled for nine days later.

Essentially, the EPA claims that the spill was an act of God, rather than its own fault.

More reports are forthcoming, as well as hearings and other activities, including lawsuits. This spill won’t easily recede from the news any time soon:

DENVER – Congressional Republicans are questioning whether the Environmental Protection Agency interfered with a separate investigation into the Gold King Mine spill after an earlier internal review clashed with other accounts of the incident.

In a letter Friday to EPA Inspector General Arthur Elkins Jr., U.S. Rep. Rob Bishop, R-Utah, chairman of the House Committee on Natural Resources, and U.S. Rep. Louie Gohmert, R-Texas, chairman of the Oversight and Investigations Subcommittee, questioned the timing and substance of recent interviews conducted by EPA officials.

The separate report from the inspector general is not expected until early 2016.

“It was a very narrow focus, and it was incomplete, and there are obvious discrepancies …” Bishop told The Durango Herald at a congressional hearing last week at a mine in Idaho Springs, referencing the EPA’s Aug. 24 internal report. “It raises all sorts of questions about what’s taken place. That’s why we’ve got to start over.”

And La Plata County has tentatively agreed to EPA (taxpayer) funded remediation, which the agency still needs to approve:

A 10-year cooperative agreement in which the Environmental Protection Agency would provide $2.4 million for remedial efforts related to the Aug. 5 Gold King Mine spill received unanimous support from La Plata County Board commissioners on Tuesday.

The federal agency has assumed responsibility for a breach at the abandoned mine portal that sent 3 million gallons of mining wastewater into the Animas and San Juan rivers.

EPA officials have until Feb. 1 to approve, amend or reject the agreement, which includes eight tasks to ensure the future health and safety of the county’s residents and environment. Those include continued work with Wright Water Engineers, which has conducted for the county an analyses on the Animas River’s health, independent of the EPA.

Other initiatives include a real-time water-monitoring system to alert the county of changes in water quality, developing a response plan for future environmental incidents and hiring a contractor for community outreach – to explain pre- and post-spill data to the public.

***

Sometimes in the course of celebratory effusion, the proponents of renewable energy–in this case, solar advocates begging for an extension of the 30 percent investment tax credit–spill the beans on how much the industry is completely reliant on government subsidies in order not just to be competitive in their parlance, but actually remain “viable” at all (and in Slate, no less):

The solar investment tax credit—in which owners of solar-panel systems get a 30 percent tax credit—was always meant to be temporary and is set to expire next year. [emphasis added] The Republicans in Congress generally favor fossil fuels over renewables, generally oppose anything President Obama is for, and deny the need to deal with climate change. So as fall settled in, investors began to focus on the fact that by the end of 2016, the solar investment tax credit of 30 percent would fall to 10 percent for commercial systems and disappear entirely for home-based systems.

Another problem: Renewable energy is as much about financial engineering as it is about electrical engineering. For solar to work, investors had to believe that the structures rigged up to build solar would stand up over time… [emphasis added]

Next, Washington delivered—defying the conventional wisdom. Newly installed House Speaker Paul Ryan realized that he’d have to negotiate with congressional Democrats if he wanted to get a budget and tax deal before the end of the year. And as they came to the table, another miracle happened: The Democrats held fast. On Dec. 14, Democrats indicated they would be willing to support the Republican-backed effort to lift the ban on oil exports—but only if the Republicans would consent to measures including a multiyear extension of renewable energy credits. It worked. Last Friday, Congress voted to extend the 30 percent solar investment tax credit through 2019, and then to reduce it to 10 percent through 2022.

That move instantly made the U.S. solar industry viable for another six years. [emphasis added] Investors were elated. SolarCity’s stock popped as details of the budget agreement began to emerge and then soared on its announcement. By Friday, the stock was above $56, up about 117 percent from its November low. SunEdison’s stock closed on Friday at $6.51, up 127 percent in a month. The Guggenheim Solar ETF is up about 30 percent from Nov. 19 through last Friday.

God bless us, everyone.

It will cost us, everyone. Except for the solar companies, who are busy carving up the fatted Christmas goose.

August 20 Colorado Energy Roundup: Poll shows Coloradans not impressed by Clean Power Plan, fracking ballot measures expected, #greenjobsfail, and EPA/Animas River saga continues

August 20, 2015 by michael · Comments Off
Filed under: Environmental Protection Agency, Legal, renewable energy, solar energy, wind energy 

This week the Independence Institute released the results of poll concerning the Environmental Protection Agency’s Clean Power Plan and who Coloradans feel does a better job when it comes to guarding the state’s environmental quality–folks here prefer Colorado oversight to meddlesome DC regulations:

The poll was conducted August 9-10th and found those surveyed more likely to oppose the EPA’s controversial Clean Power Plan if the rule resulted in electricity bill hikes, 59 to 33 percent.

Fifty-five percent said they would oppose the plan if it meant spiking poverty rates in black and Hispanic communities by 23 and 26 percent, as a recent study by the National Black Chamber of Commerce concluded.

Respondents also opposed the plan when it came to the core environmental impacts projected by the agency—a 0.02 degrees Celsius reduction in global temperatures and no notable impact on carbon emissions. Fifty-one percent said the promised temperature reduction would make them more likely to oppose the finalized rule, while 58 percent said that the Clean Power Plan’s non-existent impact on carbon emissions would do the same.

You can read the rest of the topline results here.

Screen Shot 2015-08-20 at 12.34.52 AM

Colorado’s registered voters put their trust in the state to manage the environment, and not federal regulators from the EPA or DC in general:

While Colorado’s Attorney General, Cynthia Coffman, has not weighed in on whether the state could join a multi-state lawsuit against the EPA over the Clean Power Plan (she has said it is on the table), a 53 to 37 percent majority favored the state joining at least 16 other states in the suit.

Nearly 6 in 10 said the state should wait to comply—not move forward as Governor John Hickenlooper has directed—on drawing up a state implementation plan for the Clean Power Plan.

Nearly half said that they would be more likely to support a plan if the state of Colorado determined the cost of compliance before that plan became law.

When it comes to environmental regulation and quality, Coloradans clearly preferred the regulators in Denver to those in Washington, D.C.

The State of Colorado does a better job regulating for a clean environment 37 to 5 percent over federal regulators. Twenty-seven percent said both state and federal agencies handled the job equally well, with nearly one in five saying that neither has done particularly well in this area.

How did the results breakdown along partisan and demographic lines?

Only Democrats (64 percent) and those earning between $100-$124K per year (51 percent) were more likely to support the EPA’s Clean Power Plan even if it meant an increase in electricity bills as a result of implementing the regulations. Overall, 59 percent of Coloradans were more likely to oppose the plan, with men and women showing no gender gap and nearly identical opposition to costly rate hikes.

A National Black Chamber of Commerce study found that poverty rates in black and Hispanic communities were likely to increase significantly—23 percent and 26 percent—under the Clean Power Plan. Fifty-five percent of Colorado voters said they would be more likely to oppose the federal regulations under those circumstances, with women edging out men (57 percent to 53 percent, respectively) in opposition. Majorities of Republicans, independents, and all age and income groups offered the same negative responses when it came to impacts on minority community poverty rates, as did the respondents when viewed across all seven congressional districts.

Democrats were still more likely to support the EPA’s carbon reduction plan by a slim 42 to 37 percent margin. The party was split, however, along gender lines, with Democratic women in opposition, 44 to 36 percent. Their male party counterparts gave the Clean Power Plan a large boost, saying 48 to 27 percent that they were more likely to back the EPA’s measure despite minority community concerns.

More results from the poll’s crosstabs can be perused here.

EPA Administrator Gina McCarthy even admitted explicitly that the Clean Power Plan would adversely harm minority and low-income families the hardest:

The chief environmental regulator in the United States had some blunt words of reality regarding the administration’s climate change regulations.

The Clean Power Plan that will require drastic cuts in 47 states’ carbon dioxide emissions – consequently shifting America’s energy economy away from affordable, reliable coal – will adversely impact poor, minority families the most.

When speaking about the higher energy prices caused by the administration’s climate regulations on power plants, Environmental Protection Agency Administrator Gina McCarthy said, “We know that low-income minority communities would be hardest hit.”

McCarthy downplayed that fact by saying any minimal higher prices would be offset by implementing energy efficiency measures that would save consumers money in the long run.

Cato shows how “carbon dioxide emissions” have turned into “carbon pollution” when it comes to EPA messaging over the years.

Screen Shot 2015-08-20 at 1.09.32 AM

***

Another new EPA rule? Yep:

With the Environmental Protection Agency expected to release a rule this month on methane regulations, proponents are gearing up for a messaging war.

Federal regulators aim at reducing oil-and-gas methane emissions by as much as 45 percent by 2025. The idea is that companies can use new technology to better capture methane emissions from operations.

The EPA estimates that 7 million tons of methane are emitted every year, though environmentalists suggests that it could be much higher.

The issue is relevant in Southwest Colorado, where researchers identified a significant methane “hot spot” in the Four Corners. A team of scientists is currently investigating the cause of the concentration, which could stem from a combination of natural-gas exploration and natural occurrences.

But industry efforts have already cut methane emissions significantly, making the rule seemingly superfluous:

This is going to go down in the books as one of the most curious moves ever taken by the Obama EPA, not because the reduction of methane emissions is a bad idea, but because it’s already been taking place in gangbuster fashion. The Institute for Energy Research put out a statement as soon as the new proposal was announced which put the question in context.

“Since 2007, methane emissions fell by 35 percent from natural gas operations, while natural gas production increased by 22 percent. According to EPA, voluntary implementation of new technologies by the oil and natural gas industry is a major reason for the decline in emissions.”

And where is the IER getting these figures about reductions in emissions? Are they coming from some big oil loving, pro-drilling think tank? No. It’s data taken from the EPA’s own studies which were cited in generating these rules. But just in case any of them don’t read their own promotional material, here are the numbers in graph form.

Methane

***

Anti-frack is BAAAAAAAAAAAACK!!!

After failing to gather enough signatures last summer, Coloradans for Community Rights said Monday it will try again to get a statewide initiative giving communities control over oil and gas exploration on the ballot.

Spokesman Anthony Maine said the group will begin circulating petitions early next year to get the Colorado Community Rights Amendment to the state Constitution on the November 2016 ballot.

“This is about communities being allowed to decide for themselves,” Maine said at a press conference in Denver.

He said the oil and gas industry and their supporters are expected to pump in millions of dollars to fight the proposed amendment.

“This radical measure would allow city councilors and county commissioners to ban any business or industry for any reason even if those reasons violate federal or state law,” Karen Crummy, spokeswoman for Protect Colorado, said in a statement. Protect Colorado is an issue committee organized to fight anti-energy ballot measures.

Unlike other observers who felt that this issue might recede into next year’s political battles or be left up to the current court battles, it’s been clear to me from my work on this issue that activists are gearing up for the long game, announcing their efforts more than a year from the 2016 ballot, banking on possible favorable wins in a presidential cycle rather than the 2014 midterm. Many anti-fracking activists felt burned by Governor John Hickenlooper’s “compromise” last year that appeared to be an effort to provide fellow Democrats political cover in what was shaping up to be a costly and election-determining fight at the ballot box. Hickenlooper’s commission did not assuage the resentment of activists, Democrats lost a U.S. Senate seat, and the issues remained unresolved, just kicking the can down the road.

We’ve caught up to the can once again.

***

At the Independence Institute, we’ve been taking a look at the failed promises of “green” jobs since 2011, and a California initiative passed with the help of billionaire Tom Steyer appears to have fallen, uh, short of its job creation goals in the green sector–by about 90 percent:

The California ballot measure funded by billionaire environmentalist Tom Steyer that raised taxes on corporations to create clean energy jobs has generated less than a tenth of the promised jobs.

The Associated Press reported that the Clean Energy Jobs Act (Prop. 39) has only created 1,700 clean energy jobs, despite initial predictions it would generate more than 11,000 each year beginning in fiscal year 2013-14.

Prop. 39, which voters approved in 2012 after Steyer poured $30 million into the campaign supporting it, closed a tax loophole for multi-state corporations in order to fund energy efficient projects in schools that would in turn create clean energy jobs.

More than half of the $297 million given to schools for the projects has been funneled to consultants and energy auditors.

#greenfail

***

As we noted in late 2013, the current administration pushed for changes it hoped would bolster the long term outlook for wind energy by attempting to deal with one of the unfortunate tradeoffs of giant wind turbines–bird deaths:

But a move to extend the life of one renewable energy source–in this case, wind–by granting a six-fold extension to ‘takings’ permits issued to wind farms that allow the accidental killing of bald and golden eagles has united opponents normally at odds: Senator David Vitter (R-LA) and groups like the National Audubon Society and Natural Resources Defense Council.
A sampling, from Politico:

It’s baldly un-American, Vitter said Friday.

“Permits to kill eagles just seem unpatriotic, and 30 years is a long time for some of these projects to accrue a high death rate,” said the Louisiana senator, who is the top Republican on the Senate Environment and Public Works Committee and one of Congress’s most outspoken critics of wind.

Sounding a similar theme, National Audubon Society CEO David Yarnold said it’s “outrageous that the government is sanctioning the killing of America’s symbol, the bald eagle.” He indicated his group may sue the administration.

The rule also drew criticism from Frances Beinecke, president of the Natural Resources Defense Council, who said it “sets up a false choice that we intend to fight to reverse.”

“This rule could lead to many unnecessary deaths of eagles. And that’s a wrong-headed approach,” she said. “We can, and must, protect wildlife as we promote clean, renewable energy. The Fish and Wildlife Service missed an opportunity to issue a rule that would do just that.”

Secretary of the Interior Sally Jewell defended the rule change.

“Renewable energy development is vitally important to our nation’s future, but it has to be done in the right way. The changes in this permitting program will help the renewable energy industry and others develop projects that can operate in the longer term, while ensuring bald and golden eagles continue to thrive for future generations,” Jewell said.

Well, the so-called “takings” extension to 30 years has had its wings clipped by the court:

The express purpose of the 30-Year Rule was to facilitate the development of renewable wind energy, since renewable developers had voiced a need for longer-term permits to provide more certainty for project financing.

The Fish and Wildlife Service (FWS) issued the 30-Year Rule without preparing either an Environmental Assessment (EA) or an Environmental Impact Statement (EIS) under the National Environmental Policy Act (NEPA); instead, the FWS determined that the 30-Year Rule was categorically exempt. In overturning the rule, the court found that the FWS had not shown an adequate basis in the administrative record for its decision not to prepare an EIS or EA and therefore failed to comply with NEPA’s procedural requirements.

***

Finally, to the EPA induced toxic spill saga of the Animas River . . .

Congressman Scott Tipton (R-3rd CD) and colleagues are asking the EPA questions:

We remain completely unsatisfied with the delay in notifying the impacted communities and elected officials responsible for preparing and responding to a disaster such as this one.

What was the reason for the over 24 hour delay between the time of the incident and official notification and acknowledgment by your agency that a blowout had occurred?

Who in the EPA’s regional office was first notified of the blowout and when?
What steps has the EPA taken, or does it plan on taking in the very near future, to ensure that this type of delay in acknowledgment and notification of the appropriate parties does not happen again? What additional steps will the EPA take to create and implement an emergency response plan for EPA projects such as this?

That’s just a sample of a raft of questions from the House members.

Sen. Cory Gardner (R-CO) and a bipartisan group of colleagues sent their own questions to the EPA:

We, therefore, respectfully request the following be included in a report on the events surrounding the Gold King Mine spill:

1. Details on the work EPA was conducting at the Gold King Mine prior to the spill on August 5, 2015;

2. Details of the expertise of the EPA employees and contractors carrying out that work;

3. Criteria EPA would apply before approving a contractor for a similar cleanup performed by a private party and whether EPA applied the same criteria to itself;

4. EPA’s legal obligations and current policies and guidelines on reporting a release of a hazardous substance;

5. EPA’s legal obligations and current policies and guidelines on contacting tribal, state and local government agencies when the agency creates a release of a hazardous substance;

Again, just a sampling of what members of Congress–and the public both down in southwest Colorado, northern New Mexico, and Utah–would like to know, demanding a full accounting of the EPA spill as soon as possible.

New Mexico Governor Susana Martinez wasn’t drinking the EPA tang koolaid, or its official responses so far, and is asking for her state to investigate as well:

Today, I ordered the New Mexico Environment Department to investigate the circumstances surrounding the EPA-caused toxic waste spill into the Animas River.

New Mexicans deserve answers as to why this catastrophe happened and why the EPA failed to notify us about it — the first we heard about it was from the Southern Ute Tribe nearly 24 hours later.

The EPA should not be held to a lower standard than they hold private citizens and businesses.

Colorado Attorney General Cynthia Coffman feels that she is not getting the whole picture either, and is still considering a lawsuit against the EPA for the spill:

The attorneys general of Colorado and Utah visited this still-festering site on a fact-finding mission Wednesday and left feeling the Environmental Protection Agency had not provided them with the whole picture.

“There’s a list, honestly,” Colorado Attorney General Cynthia Coffman said of her questions.

Coffman and her Utah counterpart, Attorney General Sean Reyes, are among a group that have said legal action against the EPA is being weighed after the agency’s Aug. 5 wastewater spill in the San Juan County mountains above Silverton.

The spill sent 3 million gallons of contaminated water surging into the Animas and San Juan rivers.

New Mexico’s attorney general said last week he is considering a lawsuit, and Navajo Nation leaders, whose community arguably has been most impacted by the disaster, said they will sue.

That lack of information–or, indeed, a coverup–has been the focus of much attention, and Colorado Peak Politics believes the EPA hasn’t been forthcoming from the beginning.

The EPA’s own watchdog is also launching an investigation:

The inspector general for the Environmental Protection Agency announced on Monday that it is beginning an investigation into the agency’s role in triggering a massive toxic waste spill in southwest Colorado.

The IG alerted a number of senior EPA officials to the investigation in a memo released on Monday. “We will request documents, and interview relevant managers and staff in these locations and elsewhere as necessary,” the IG said.

The announcement comes amid controversy over EPA’s role in the spill. Agency chief Gina McCarthy admitted last week that EPA inspectors had triggered the incident while inspecting cleanup efforts at the Gold King Mine near Durango, Colo.

What are the cleanup costs estimated to be? The Daily Caller’s examination of potential burdens to the taxpayer due to EPA negligence are big:

The right-leaning American Action Forum estimates the total cost for responding to the Gold King Mine Spill could range from $338 million to $27.7 billion based on the federal government’s own cost-benefit analyses for cleaning up toxic waste and oil spills.

“There is no direct precedent for the toxic Animas River spill in Colorado and past regulatory actions from agencies, but we can learn from previous benefit-cost estimates,” writes Sam Batkins, AAF’s director of regulatory policy, adding that he “evaluated four recent regulations’ benefit figures to approximate the cost of the current spill in the Mountain West.”

That’s not good news, considering the mine owner’s allegations that the EPA has dumped toxic waste as far back as 2005, or that billions of gallons might be poised to spill in the future.

And that future is unclear due to what still lies beneath:

State and federal officials have offered assurances that the river is returning to “pre-event conditions,” but uncertainty remains over the residue that still lurks beneath the surface flow.

Those remaining metals on the river bottom still could affect aquatic life, agriculture and other aspects of life along the water in ways that are difficult to predict.

“The long-term effects are the concern that every time we have some sort of a high-water event, whether a good rain in the mountains or spring runoff next year, that’s going to stir up sediments and remobilize those contaminants that are sitting at the bottom of the river right now,” said Ty Churchwell, Colorado backcountry coordinator for Trout Unlimited.

CBS4Denver had the opportunity to get an early look at the mine itself, post-spill.

Perhaps the only thing quite as toxic as the spill itself is the messaging cover both local and regional environmental groups and pro-administration activists are providing the EPA, casting blame on private mismanagement and pollution and offering only an “aw shucks, only trying to help” defense of the agency:

Only the NRDC offered a response.

Earth Justice and several other environmental groups have made no public comment on the Animas River spill at all. In their public statements, neither the NRDC nor the Sierra Club pointed the finger at the EPA.

Though the Sierra Club did not respond to our inquiries, it did offer this public statement on August 11:

The Animas River was sadly already contaminated due to the legacy of toxic mining practices. The company that owns this mine has apparently allowed dangerous conditions to fester for years, and the mishandling of clean-up efforts by the EPA have only made a bad situation much worse. As we continue to learn what exactly happened, it’s time that the mine owners be held accountable for creating this toxic mess and we urge the EPA to act quickly to take all the steps necessary to ensure a tragedy like this does not happen again.

In a recent statement, the NRDC’s President Rhea Suh said only that the EPA “inadvertently triggered the mine waste spill last week,” while casting mining companies and Republicans in the House of Representatives as the responsible parties.

They probably wouldn’t like the Colorado Springs Gazette’s suggestion that mine clean up be privatized:

Critics have recoiled at the thought of putting the government’s environmental work into private hands.

No longer should they perceive or argue a level of federal competence that exceeds what the private sector might provide. The EPA unleashed a toxic sludge of arsenic, lead and other harmful toxins without bothering to warn people downstream, including tribal leaders and governors of neighboring states. They botched the inspection that led to the spill and bungled the response.

July 9 Colorado Energy Roundup: government won’t appeal in Colowyo case, true costs of wind energy revealed

Perhaps the most pressing energy and jobs-related issue in Colorado right now is the legal battle over the Colowyo Mine in the northwest part of the state:

The U.S. Department of the Interior has decided not to pursue an appeal of a federal court ruling that threatened to close Colowyo coal mine in Northwest Colorado.

According to a statement from Department of the Interior spokeswoman Jessica Kershaw, “We are not appealing the court’s decision, but are on track to address the deficiencies in the Colowyo permit within the 120-day period.”

“We are disappointed that the government did not appeal the federal district court’s decision. Colowyo Mine remains confident that the U.S. Department of Interior and Office of Surface Mining are making every effort to complete the required environmental review within the 120-day period ordered by the court,” Tri-State’s Senior Manager of Corporate Communications and Public Affiars Lee Boughey wrote in an email. “These efforts help ensure compliance with the judge’s order while supporting the 220 employees of Colowyo Mine and communities across northwest Colorado.”

The legal decision in May that tripped off the permitting kerfuffle that endangers the operation of the Colowyo Mine stemmed from a lawsuit brought by WildEarth Guardians that the mine’s 2007 permit did not follow the Office of Surface Mining Reclamation and Enforcement requirements as well as National Environmental Policy Act rules.

Bipartisan efforts have poured in from across Colorado, as politicians, the business community, and legal experts recognize the importance and high stakes involved in the threat to the mine from a procedural and regulatory environment standpoint:

Gov. John Hickenlooper, U.S. Senators Cory Gardner and Michael Bennet, and [Rep. Scott] Tipton all joined Craig City Council and Moffat County Commissioners in addressing Jewell regarding the situation at Colowyo.

On July 2, the Denver Metro Chamber of Commerce, the Metro Denver Economic Development Corporation, the Colorado Competitive Council and the Colorado Energy Coalition sent a co-authored letter to Jewell voicing their concerns.

According to the letter, “this precedent could pose a threat to any activity on federal lands that performed an environmental analysis under the National Environmental Policy Act in order to obtain federal leases and permits. That could stretch from energy development and mining, to agricultural grazing and ski resorts becoming vulnerable to retroactive legal challenges.”

Tri-State’s Boughey noted that the government’s appeal isn’t necessary, however:

The ColoWyo appeal isn’t dependent on any other party’s decision to appeal or not appeal Jackson’s decision, Boughey said.

“We believe the court made several significant errors, including misreading the Surface Mining Control and Reclamation Act. This prejudices not only Colowyo but other mining operations, and sets a precedent that should raise concerns for the U.S. energy industry and other activities on federal land,” he said.

In essence, Tri-State and ColoWyo officials don’t think the federal Office of Surface Mining should be looking at power plant operations.

“The court’s requirement that the agency analyze emissions from power plants inappropriately expands National Environmental Policy Act analyses for mining plans beyond what is prescribed under the law,” Boughey said.

The Independence Institute will continue to monitor the developments in the Colowyo legal battle.

***

Meanwhile, the WildEarth Guardians continue their crusade against all natural resource extraction, as the Denver Post’s Vincent Carroll recently illustrated:

Jeremy Nichols may not be the official stand-up comic of green activism, but he seems to be auditioning for the role. How else to explain his risible claim in a recent Denver Post report on the struggling economy in northwest Colorado that WildEarth Guardians isn’t trying to shut down the Colowyo coal mine and throw 220 people out of work?

“We want to have an honest discussion about the impact of coal and find a way to come together to figure out the next step,” Nichols, the group’s spokesman, maintained.

Why, of course. A group militantly opposed to fossil-fuel production files a lawsuit challenging the validity of a coal mine plan approved years ago — but does so only to provoke an “honest discussion.” Please.

WildEarth Guardians is opposed to all fossil-fuel extraction in the West, and makes no bones about it. In the winter 2013-14 edition of Wild Heart, Nichols outlined the group’s position on those other big fossil fuels, oil and natural gas.

“As communities in Colorado and elsewhere have learned well,” Nichols wrote, “it’s not enough to make oil and gas development cleaner or safer. For the sake of our health, our quality of life, and our future, it simply has to be stopped.”

“In some cases,” Nichols explained, “we can stop it cold … . In other cases, we can raise the cost of drilling to make it economically infeasible.”

The Colowyo Mine is still operating for now, but WildEarth’s apparent regulatory sabotage certainly seems consistent with its efforts to “stop it cold” when it comes to natural resources. Not to mention throwing 220 people out of work and disrupting the economy of an entire region.

Some “honest discussion.”

***

The price of a barrel of oil began to decline sharply in late 2014, prompting fears that the crashing crude market would tank the nation’s nascent energy resurgence, but despite falling numbers, 2015 still looks to be a year of production highs:

The amount of crude oil produced across the United States fell in May compared to April — but federal forecasters say 2015’s overall production is still “on track” to be the highest in 45 years.

The Energy Information Administration (EIA) on Tuesday released its monthly short-term energy outlook, noting that crude oil production fell in May by about 50,000 barrels of oil per day compared with April.

In Colorado, oil production from the Niobrara field north of Denver, part of the larger Denver-Julesburg Basin, is expected to drop about 17,000 barrels per day in July compared to June, the EIA said.

The number of drilling rigs running in the state has dropped from 72 at the start of 2015 to 39 at the end of June as oil and gas companies have cut back on spending.

But, as we know from basic economics about supply and demand, lower oil prices mean lower gas prices, and that is driving demand back up to pre-recession levels:

But the on the consumer side, a better economy and low gasoline prices are expected to boost the amount of gasoline used in the U.S. by an estimated 170,000 barrels per day over 2014, the report said.

“U.S. gasoline demand will likely top 9 million barrels per day this year for the first time since 2007, which reflects record highway travel,” Sieminski said.

***

There’s no doubt that readers of the Independence Institute’s Energy Policy Center blog and op-eds are familiar with the argument that electricity derived from wind energy is more costly than other forms of generation–namely coal and natural gas–when one accounts for the massive amount of Federal subsidies, incentives, and state and local renewable mandates and other handouts.

A new study from Utah State University once again confirms that conclusion–”when you take into account the true costs of wind, it’s around 48 per cent more expensive than the industry’s official estimates”:

“In this study, we refer to the ‘true cost’ of wind as the price tag consumers and society as a whole pay both to purchase wind-generated electricity and to subsidize the wind energy industry through taxes and government debt,” said Ryan Yonk Ph.D., one of the report’s authors and a founder of Strata Policy. “After examining all of these cost factors and carefully reviewing existing cost estimates, we were able to better understand how much higher the cost is for Americans.”

The peer-reviewed report accounted for the following factors:

The federal Production Tax Credit (PTC), a crucial subsidy for wind producers, has distorted the energy market by artificially lowering the cost of expensive technologies and directing taxpayer money to the wind industry.

States have enacted Renewable Portfolio Standards (RPS) that require utilities to purchase electricity produced from renewable sources, which drives up the cost of electricity for consumers.

Because wind resources are often located far from existing transmission lines, expanding the grid is expensive, and the costs are passed on to taxpayers and consumers.

Conventional generators must be kept on call as backup to meet demand when wind is unable to do so, driving up the cost of electricity for consumers.

“Innovation is a wonderful thing and renewable energy is no exception. Wind power has experienced tremendous growth since the 1990’s, but it has largely been a response to generous federal subsidies,” Yonk stated.

But Utah State University researchers aren’t the only ones pulling back the curtain on the true cost of wind. A new study from the Institute for Energy Research demonstrates that a real comparison between existing power plants and new power plant sources shows that wind power once again comes up short in the low cost department:

Today, the Institute for Energy Research released a first-of-its-kind study calculating the levelized cost of electricity from existing generation sources. Our study shows that on average, electricity from new wind resources is nearly four times more expensive than from existing nuclear and nearly three times more expensive than from existing coal. These are dramatic increases in the cost of generating electricity. This means that the premature closures of existing plants will unavoidably increase electricity rates for American families.

Almost all measures of the cost of electricity only assess building new plants–until now. Using data from the Energy Information Administration and the Federal Energy Regulatory Commission, we offer useful comparison between existing plants and new plants.

America’s electricity generation landscape is rapidly changing. Federal and state policies threaten to shutter more than 111 GW of existing coal and nuclear generation, while large amounts of renewables, such as wind, are forced on the grid. To understand the impacts of these policies, it is critical to understand the cost difference between existing and new sources of generation.

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A link to the complete study can be found on the Institute’s release page.