Tag: "Regulation EPA Electricity Energy"

Hundreds of Frac Restrictions Quietly Sweep Across America

Hydraulic fracturing or “fracking” is a well completion technique that is the key to America’s shale boom. Because of hydraulic fracturing, the U.S. has become the world’s top natural gas producer and has gained the capability to become the world’s top oil producer. The shale boom has generated a great majority of jobs created since the recession, and created great wealth for the states where shale deposits are found.

Despite the benefits of energy production, hydraulic fracturing bans and draconian regulations have become more and more common at both the state and local level. To date, greater than 400 municipalities around the country have passed frac restrictions according to Food and Water Watch, an environmental group that tracks anti-fracturing activism. The trend appears to be increasing nationally.

The significance of local bans is little discussed in the energy sector, and underreported, at least from a macro perspective. While the press widely reported that the state of New York passed a statewide moratorium on hydraulic fracturing, few noted that the State was already home to greater than 200 municipal bans on fracking before the state imposed a statewide restriction. Restated, greater than 200 New York communities debated the question of whether to permit hydraulic fracturing and concluded that restricting production and wealth generation was the best policy.

Some industry observer dismiss frac bans as inconsequential because they often pass in areas that have little or no frac activity anyway, such as in the case of the statewide ban in Vermont. “The market will adjust,” is the common mantra among producers. One should note, however, that frac restrictions are concentrated on the West and East coasts, where many of the nation’s rich shale deposits lie, such as the Marcellus (NY) and Monterey (CA). Likewise, the public opinion that is formed in the cities and towns will likely factor into future action at the state level, as we have seen in New York and as we are likely to see in California and Colorado.

Can energy producers rely on the states to override local bans to protect their activity? In Texas, probably yes. In California and Colorado, it is much less certain. If public opinion can be our guide, the outlook is not so good. Countrywide, in November of 2014, only 41% of Americans polled favored the increased use of fracking while 47% were opposed. By contrast less, just one year before, there was more support (48%) than opposition (38%) to the drilling technique. Some surmise that the unpopularity of fracking is limited to the coasts, but the Pew poll of 2014 shows that the most dramatic shift in opinion is seen in the Midwest where support for hydraulic fracturing dropped a breathtaking 16 points from 55% to 39% from 2013 to 2014.

San Benito County, California — one of over twenty localities which have banned fracking activity in the state — is currently locked in a legal battle with Citadel Exploration, an energy company which claims that only the state of California itself (as opposed to municipalities) has the ability to ban fracking. Even if Citadel Exploration prevails, should proponents of fracking feel that California production investments are safe? Barely a year ago, the Californian state Senate nearly enacted a moratorium to ban fracking temporarily. With a final count of 18-16 against the ban, the state only lacked two votes for a majority pass. The same trend has been seen in other states, like New York and New Jersey where the temporary period of inactivity in the gas sector is followed by more outcries from environmentalist groups, and the subsequent drafting of more final, permanent restrictions on hydraulic fracturing.

The cost of these bans is high, especially given the sheer quantity of untapped or undiscovered natural resources. California, Pennsylvania and Colorado are three possible battlegrounds to watch in the future, all of which contain high concentrations of gas resources and formidable past opposition either in their local communities or their state legislatures. The cost of completely eliminating the production of these resources is outlined by the sheer quantity they withdraw for sale on a monthly basis. Based on the graph below, at an average cost of $2.69 per million cubic feet (mcf), the states of CA, PA, and CO would lose almost $1,611,300 in monthly production revenue for natural gas alone, without even considering oil.

The list of counties which have banned fracking is growing on a monthly basis. In addition to state regulations, local government hydraulic fracturing restrictions now number in the hundreds, and are concentrated in CA and along the Eastern Seaboard. Policymakers must adopt an emphasis on balancing socially responsible results with protecting the rights and revenue generating capacities of the industry to insure continued job creation and economic growth.

Mar 18, 2015 | 2 comments | by Santiago Bello

Wyoming Congresswoman to Wrangle Federal Overreach

Rep. Cynthia Lummis, a Republican from Wyoming and the new chair of the Interior Subcommittee of the House Oversight Reform Committee, says she is determined to provide strict oversight of President Barack Obama’s energy and environment policies and scale back what she believes is federal overreach.

With oversight of the EPA, the Interior Department, the Energy Department, and the Agricultural Department, amid an increasing number of executive actions and accusations of departmental mismanagement and misconduct, Lummis has plenty of work ahead.

Wyoming Water

Lummis argues the administration went too far in attempting to control water use under the Clean Water Act. In response, she co-sponsored H.R.5078, the Waters of the United States Regulatory Overreach Protection Act of 2014, a bill intended to limit the EPA’s reach under the Clean Water Act. Regarding this bill, Loomis said in a press statement,

In Wyoming, water is our single most precious natural resource, which we guard jealously and without which our communities and economies could not survive. The agency is stretching the law to the point of breaking it, claiming jurisdiction over every pond, ditch, and stream in Wyoming no matter how small or isolated.… This legislation gives state and local governments a long overdue seat at the table and ensures Congress has final say over what water is and is not subject to the Clean Water Act.

The Democrat-controlled Senate did not vote on the bill in 2014. With Republicans in control of both the House and Senate in 2015, the bill is likely to pass this year. Whether President Obama would sign the bill or veto it is an open question.

Advocating Spending Cuts

Lummis has also set her sights on reining in government spending. She drafted a bill requiring federal workforce downsizing through attrition, to save an estimated $35 billion over five years. “We’ve racked up over $18 trillion in debt simply because Washington has no idea when to stop spending,” Lummis said. Her bill, the Federal Workforce Reduction Through Attrition Act, would limit hiring of new employees as older ones retire, reducing the number of federal employees without forcing anyone one out of a job.

She also plans investigations into alleged corruption, bullying of whistleblowers, and general impropriety in the Chemical Safety Board and EPA.

Bonner Cohen, a senior fellow at the National Center for Public Policy Research, says Lummis’s oversight could be just the breath of fresh air federal agencies need. “The Obama administration has been bypassing Congress and imposing far-reaching regulations, with Capitol Hill either unable or unwilling to do anything about it. Rep. Lummis will now have a friendly Senate to work with to rein in the administrative regulatory state,” he said.

If members of Congress, as well as state and local governments, want to avoid being relegated to being little more than decorative potted plants, they should follow the example set by Rep. Lummis and aggressively oppose further usurpation of their power by Washington bureaucrats.

Feb 25, 2015 | Leave a Comment | by Nate Wilson

Evolving Energy Infrastructure — Energy Battles Looming at Home

The electrical utilities industry is one that has always been regarded by economists as unique, with its most defining aspect being competition. There is little to none. However, economists have always argued that this is only a rational byproduct of the infrastructure associated with transporting energy. A perfectly competitive market is saturated with companies, and with hundreds or even thousands of different energy companies, the power lines and facilities required to generate electricity would be astronomically inefficient. For this reason, infrastructure in this field has been widely shielded from the pressures brought by rival businesses and increasingly demanding customers.

The free market could be on the verge of changing these norms. It all begins with introducing an adversarial element to the electrical utilities sector.

Vivek Wadhwa, a fellow at the Rock Center for Corporate Governance at Stanford University and the director of research at Duke’s Center for Entrepreneurship and Research Commercialization begins the topic of evolving energy at its root: Many forms of energy are outdated or considered too dangerous. President Obama’s recent energy accords in India is an example of this, with Wadhwa stating,

This is hardly a victory for the United States or for India. It no longer makes sense for any country to install a technology that can create a catastrophe such as Chernobyl or Fukushima — especially when far better alternatives are available.

Furthermore, Wadhwa points out that nuclear facilities and growth in the nuclear energy sector has been stagnant compared to coal, natural gas and renewables, a claim largely supported by the Energy Information Administration’s statistics on U.S. energy consumption.

The president should not be prescribing medicine [to electrical consumption] that he would not take himself.

In a 2014 report, “Energy 2020: The Revolution Will Not Be Televised as Disruptors Multiply,” Citigroup claims that coal has suffered a serious double threat with the resurgence of natural gas during America’s shale revolution, and most surprisingly the projected ― not current ― falling costs of solar energy.

Indeed, natural gas and renewables such as solar are also the only two major methods of energy production which have consistently expanded at a positive rate for many years. Oil has historically been rarely used by electrical utility companies, and hydroelectric energy ― which does account for significant amounts of energy in the U.S. ― has largely been stagnant in meeting our rising demand for energy.

The growing popularity of renewables such as solar and wind has been a phenomenon that has been observed mainly in Europe. In a separate article, “The Coming Era of Unlimited ― and Free ― Clean Energy,” Wadhwa explains many countries in Europe have reached grid parity, a state in which installing electrical grids powered by wind and photovoltaics have matched energy prices from conventional electrical power plants. Were such a phenomenon to begin in the United States, it would be horrible news for coal, which is already hobbling along, largely due to the higher costs imposed by environmental regulations.

Solar and wind’s capacity for powering microgrids — grids which operate in the local vicinity in which their consumers reside — could also put pressure on the entire infrastructure that American energy needs have relied on for years. America’s energy infrastructure is also vastly outdated — with the best example of such being the Northeast’s chronically faltering electrical grid. The lack of innovation and improvement is mainly due to the lack of competition in the sector. Though solar and wind energy is still years away from being able to match domestic prices, advances in microgrid popularity which would be enabled by Citi’s projected foreign investment in the two energies could introduce choice to the energy sector, effectively lowering prices and helping America in its quest to be energy independent.

Feb 04, 2015 | 2 comments | by Santiago Bello

Dallas Imposes Plastic Bag Tax

After over two dozen cities around the nation have banned plastic bags, Dallas officially joined this year at 5 cents per bag. This new imposed fee encourages the use of reusable bags. However, the Dallas plastic bag ban will end up having a negative effect on the city.

Contrary to the myth propagated by environmental lobbyists, plastic bags are not a significant source of waste. Indeed, the national 2009 Keep America Beautiful study does not even include plastic bags in its top 10 sources of litter. A recent study found that plastic grocery bags make up less than 0.6 percent of the overall waste stream.

Negative effects of a plastic bag tax:

Stores affected by bag bans reported an increase in missing shopping carts and hand baskets.
Stores inside the Los Angeles ban area reduced their employment by more than 10 percent. Stores outside the ban area increased their employment by 2.4 percent. This occurred despite the fact that the overall unemployment rate in Los Angeles County fell dramatically.
The cost to taxpayers also will rise as lawsuits are filed challenging these bans.

Reusable bag dangers:

On the economic front, China is the leading manufacturer of reusable bags, while plastic bags are made in the U.S. with the industry employing thousands of workers.
When the bags are used to carry meats, poultry or fish, blood and other fluids can soak into them. If not cleaned regularly and stored properly, bacteria — including E. coli — can take up residence and mold can form.

Free plastic bags benefits:

Plastic bags reused to line bathroom trash bins, collect dog waste and used cat litter, to securely seal soiled diapers and more.
A number of major retailers have set up recycling boxes at the entrance of their stores to encourage recycling, and plastic bag recovery has increased by 31 percent since 2005 and according to EPA data, this growth is more than nine times the 3.4 percent increase in recovery of all municipal solid waste from 2005 to 2009.

Consumers like choice, and most choose plastic bags for their convenience, flexibility and strength. Evidence indicates that cities with bag bans lose, where people cannot choose.

Jan 05, 2015 | 2 comments | by Lloyd Bentsen

Ozone Regulation Could Cost Trillions

In a flashback to 2011, Obama is once again staring down the barrel of a controversial regulation to limit smog-creating ozone pollution. The EPA’s proposed regulation ― which would lower the threshold of ground-level ozone pollution considered healthy to breathe ― is already being decried by opponents as “the most expensive regulation ever.”

Obama nixed a similar version of the rule in 2011, claiming that he was acting to “underscore the importance of reducing regulatory burdens and regulatory uncertainty.” Yet with his recent actions on immigration, education and health care, many are left wondering whether Obama will keep his commitment to “reducing regulatory burdens” in the face of the EPA’s new proposal.

The proposal itself would lower the existing acceptable ozone standard from 75 parts per billion (ppb) to somewhere between 65 and 70 ppb ― though the EPA’s science advisers would rather see limits closer to 60 ppb. According to the EPA and environmentalist groups, lowering the amount of acceptable ozone would increase public health, reduce illness and premature deaths, and lead to $21.2-$42.1 billion in benefits, contrasted with $16.6 billion in costs.

Opponents of the regulation warn that lowering the limit would stifle economic growth, drastically reduce jobs, and wipe out trillions of dollars in economic output. A July study by the National Association of Manufacturers estimated that a strict version of the rule ― setting the limit to around 60 ppb ― would eliminate $3.4 trillion in economic output and cut 2.9 million jobs by 2040.

The EPA must make a final decision on the rule by October 1st of next year. While many argue that it’s too early to truly estimate the costs of the proposed regulation, the initial forecasts put millions of jobs, billions of dollars in investment, and trillions of dollars of economic output at risk.

“By any measure, the revised ozone rule will represent one of the costliest rules ever issued by EPA,” Louisiana Senator David Vitter told Politico. The EPA’s proposal could be “one of the most devastating regulations in a series of over-reaching regulatory actions taken by this administration.”

Dec 03, 2014 | 2 comments | by Megan Simons

Clean Power Plan Regulations have High Expectations

Advanced Energy Economy (AEE) has come up with a number of recommendations for the Clean Power Plan. The AEE sees these new federal regulations as a great benefit to the electric power system and an added opportunity to the energy industry. Here is a brief summary of AEE’s recommendations for the Clean Power Plan:

Part of the problem is simply the difficulty of predicting the technological progress that will take place by 2030 and beyond. For this reason, we called on EPA to regularly review and revise its emission targets given the steady improvement of advanced energy technologies, which will enable greater emission reductions over time.

Besides ways to strengthen the targets associated with advanced energy, we also urged EPA to take several actions to encourage the use of advanced energy technologies by states.

One way to do this is to explicitly approve more emission-reducing technologies for compliance. We called on EPA to expand the range of options to include the 40 technologies described in AEE’s Advanced Energy Technologies for Greenhouse Gas Reduction. The full report is available here.

In order to avoid uncertainty on the part of states about eligible technologies and how to incorporate them into compliance plans, EPA needs to clarify the crediting of emission reductions from renewable energy and energy efficiency actions in a variety of ways. Specifically, we urged EPA to develop a non-exclusive list of protocols for evaluation, measurement, and verification (EM&V), so that states could employ energy efficiency in their compliance plans with confidence.

We also asked that EPA provide clarity as to the crediting of renewable energy across state lines, in order to encourage the continued expansion of interstate markets. EPA should also improve the crediting of energy efficiency investments in states that are energy exporters, as well as clarify the crediting of emission reductions that occur in one state as a result of efficiency investments made in another state.

Finally, AEE urged EPA to accelerate advanced energy markets, and their associated emission reductions, by crediting emission reductions achieved prior to 2020 by new projects stemming from state compliance plans.

In sum, we are urging EPA to build upon the solid foundation of the Clean Power Plan by making changes in the final rule to fully realize the benefits of advanced energy technologies for emission reduction and economic growth. With the formal comment period open until December 1, we hope other supporters of a better energy future will do the same.

How do you feel about the Clean Power Plan and about AEE’s recommendations?

Nov 26, 2014 | 2 comments | by Lloyd Bentsen

The KEEP Energy Act

If it were not for the $300 billion boost to the U.S. economy and the more than two million jobs added each year from the oil and gas industry, we could have been in a second Great Depression. To add to this economic boom, the 114th Congress can quickly pass new legislation, such as the KEEP Energy Act according to Mark P. Mills in today’s Forbes.

KEEP is an acronym for Keystone, EPA, Exports and Production.

Keystone XL pipeline approval would be a very important symbolic victory for the United States and its allies. The pipeline would also add thousands of more jobs.
The Environmental Protection Agency needs to be reined in. The EPA’ rules and regulations threaten the economy and is gearing up for new rules for the fracking boom.
The oil and gas export ban over the past several decades, has not made sense for one of our most basic values of free global access to trade. There is even more reason to end this obsolete ban with our allies in Europe and elsewhere in great need for these energy supplies.
Energy production could increase much more if the federal government opened more lands to drilling and if there was more investments made in technologies such as horizontal drilling and hydraulic fracturing.

Nov 10, 2014 | 4 comments | by Lloyd Bentsen

2014 Election and the Future of Energy Legislation

Election Day is officially behind us. The votes are in, the campaign ads are over, and the traffic in front of the grocery store, local high schools and other polling places should go back to normal. The Republicans kept the House and took the Senate. Now the big question is: what does it all mean?

The Republicans taking the Senate could signal big changes in U.S. energy policy. This past session, Republicans and Democrats battled over the expansion of domestic energy production, GMOs and EPA regulations.

With majorities in both the House and the Senate, Republicans now have an opportunity to make some big changes in the environment and energy conversations. Yet as pointed out over at the NCPA Health Blog, running straight for the controversial topics will only lead to partisan bickering, not effective change. Rather than targeting the extreme topics, Republicans would do well to target their legislation at topics with broad, bipartisan support.

Over the course of the 113th Congress, 76 bills made it past the House, but have yet to make it past the Senate. For those that don’t make it through this session, the topics that already a) have enough clout to make it through the House and b) have enough bipartisan support to get through both houses without a huge expenditure of political capital.

Looking back at these bills, there are a few topics that stand out in both of these terms. Among them are:

Cutting Burdensome Regulations. Two bills, H.R. 2279, or the “Reducing Excessive Deadline Obligations Act of 2013” and H.R. 935, the “Reducing Regulatory Burdens Act of 2014,” both focused on cutting unnecessary regulations instituted under the banner of environmental protection. Curbing the growth of government regulations is rarely a bad idea, especially if you can do it in a bipartisan way. H.R. 935 passed with 62 percent of the vote, 8.6 percent of which came from the Democrats. While not a wide margin, it’s definitely a topic to consider as Republicans move forward into the next session.

Promoting Efficiency. No one likes inefficiency — not even Congress. H.R. 2126, the “Energy Efficiency Improvement Act of 2014,” passed the House with a whopping 87 percent of the vote. Energy efficiency, as well as procedural efficiency, could be a good focus for energy enthusiasts as we head into next session.

Increasing Domestic Energy Production. Increasing domestic energy production has the power to create jobs, boost the economy and protect national security. While definitely a more polarizing topic — the average number of Democratic supporters ranges from 7-20 for many of the bills that made it through the House, it could be a good strategy for a nation looking for an answer to Putin’s misbehavior. H.R. 6, the “Domestic Prosperity and Global Freedom Act,” actually passed with 62 percent of the vote. Exporting our natural gas reserves could be a huge help to the parts of Europe dependent on Russia, and the jobs and money it would bring in here at home aren’t a bad tradeoff.

As this next session gets under way, Republicans should keep in mind the lessons learned from Obamacare: Focusing all of your political capital on a partisan agenda right at the beginning can be disastrous. Focusing on smaller, bipartisan measures can have just as big an impact and hopefully with less of a mess.

Nov 05, 2014 | 2 comments | by Megan Simons

EPA’s Climate Change Adaption Plan

The Environmental Protection Agency has released their plans to reduce human greenhouse gas emissions and prepare for the effects of climate change. The EPA Sustainability Plan and Climate Change Adaptation Plan coincides with President Obama’s 2009 Executive Order on Environmental, Energy and Economic Performance, which set aggressive energy, climate and environmental targets for agencies, and detail how.

In the Climate Change Adaptation Plan, the EPA identifies priority actions the agency will take to incorporate considerations of climate change into its programs, policies, rules and operations to ensure they are effective under future climatic conditions. This includes:

Incorporating climate adaptation criteria in the Brownfields grants process to ensure cleanup actions taken by communities are effective as the climate changes.
Integrating considerations of climate change into the Clean Water State Revolving Funds process and continue working with states to ensure investments in water infrastructure are resilient to changes in climate.

For example, a stormwater calculator and climate adaptation tool empowers community planners to estimate the amount of stormwater runoff.

Up to this point, the aggressive regulations of the EPA have:

Reduced the federal government’s greenhouse gas emissions by more than 17 percent since 2008.
Exceeded the 24 percent energy intensity reduction from its 2003 baseline.
Reduced 2013 energy intensity by 25.6 percent from 2003.
Reduced fleet petroleum use by 38.9 percent compared to the 2005 baseline.

Federal regulations, in general, and specifically by the EPA may have good intentions, but inevitability do much more harm than good. Many examples of how these types of regulations do great harm are already well published. We can only assume that further action by the federal/state/local governments will only do more damage.

Nov 03, 2014 | 3 comments | by Lloyd Bentsen

Bag Bans are Bad Business

This past year the NCPA published numerous studies on how both bag bans, and bag regulations were harming consumers. The details of the studies revealed that not only were the local governments cashing in on taxpayers, but that the environment would still be suffering as a result. How can this be? Wouldn’t a decrease in the plastic bags being sold help the environment? After all, ecosystems suffer from trash and pollution daily, this could be the next steps towards cleaning up the country. However, this is a free market, and unintended consequences from government interaction has been an issue since people started submitting themselves to others.

Paper Bags: Plastic bags were at one time our nation’s solution to paper. Deforestation was running rampant in the world, and environmentalists were demanding paper bag removal from stores. Plastic bags, which were more efficient, cheaper and did no harm to any forests or the ecosystems within. It is also extremely important to note that paper bags create a far bigger environmental footprint than plastic, and are not able to decompose in landfills. As we approach an alternative to plastic it seems that reusable bags are in. Despite numerous reports of E.coli collecting on them, and the fact that stores are able to sell them for a bigger profit than free plastic bags, our economy is not ready to suddenly change overnight.

Increasing Taxes: Many local governments decided that instead of a ban they would propose a tax on every plastic bag used. DC for example, utilized a 5 cent fee on every plastic bag sold to consumers. The more groceries you bought, the more you would be charged. While it seemed like a good idea at the time, other countries who did the same thing ended up having to raise the tax repeatedly over time. Their tax began at 15 cents in 2001 and jumped to 22 cents in 2007. The government was forced to raise the tax after they noticed that bag use was increasing as consumers began absorbing the cost of the bags. This exact identical situation also happened to Ireland.

Sep 08, 2014 | Leave a Comment | by David Weisser

Tag: "Regulation EPA Electricity Energy"

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