Tag: "federal regulations"

Available and Off-Limits Offshore U.S. Oil and Natural Gas Resources

Despite the fact that the federal government has made it clear that all oil and natural gas drilling along the Atlantic coast is off limits, oil and natural gas companies are still going ahead with seismic surveys to see just how much oil is resting off of our eastern coast.

Close to 87 percent of all federally controlled offshore acreage are off-limits to offshore oil and natural gas development. If included in the federal government’s next five-year leasing program and lease sales beginning in 2018, exploratory drilling could start the following year with commercial production expected as early as 2023.

Opening the Atlantic Outer Continental Shelf, the Pacific Outer Continental Shelf and the Eastern Gulf of Mexico to offshore oil and natural gas development could have remarkable benefits. By 2035, this opportunity could:

  • Create nearly 840,000 new jobs along coasts and across the country.
  • Add about 3.5 million barrels of oil equivalent per day to domestic energy production.
  • Generate more than $200 billion in cumulative revenue for the government.
  • Lead to nearly $450 billion in new private sector spending.
  • Contribute more than $70 billion per year to the U.S. economy.

Specifically, increasing access to offshore oil and natural gas resources in the Atlantic with an investment of an estimated $195 billion cumulative between 2017 and 2035, could by 2035:

  • Produce an incremental 1.3 million barrels of oil equivalent per day (MMboe/d).
  • Add nearly 280,000 jobs.
  • Contribute up to $23.5 billion per year to the U.S. economy.
  • Generate $51 billion in cumulative government revenue.

If seismic activity were to begin in 2017 and lease sales in 2018, first production could be expected as early as 2026.

Mar 30, 2016 | Leave a Comment | by

Supreme Court Ruling Temporarily Helps Coal Industry

The Supreme Courts’ recent ruling temporarily holds off increased regulations on the coal industry. The administration’s stricter coal plant rules, which call for a phased-in 30-percent reduction in emissions by 2030 will be based on a state-by-state voluntary basis.

According to Environmental Protection Agency (EPA):

We will continue to provide tools and outreach. But we clearly understand that the courts will be winding through the process of looking at that rule. The [Supreme Court’s ruling] means that it’s going to take a little longer for that to happen. We will respect that, but in the meantime we’re going to continue to address greenhouse gases with the authorities under the Clean Air Act that are available to us today.

The Clean Power Plan requires very strict environmental controls to limit emissions from power plants. Twenty-seven states and a group of industry advocacy organizations challenged the new plan at the Supreme Court. The coalition of states and industry asked the Supreme Court to allow them to hold off on implementing the Clean Power Plan until after the Supreme Court has ruled on its legality. The Supreme Court granted a stay on the Clean Power Plan, giving hope, for now, to the coal industry and its allies.

Feb 17, 2016 | 2 comments | by

Supreme Court Votes Against Clean Air Act

Yesterday, the Supreme Court vote dealt a major blow to President Obama and his Environmental Protection Agency’s regulation of carbon dioxide emissions from power plants under the Clean Air Act. The Clean Air Act requires EPA to set national ambient air quality standards (NAAQS) for ozone and five other pollutants considered harmful to public health and the environment. However, the new regulation would have severe consequences, as emphasized here by the Supreme Court vote.

In addition, written testimony, related to this issue, by the NCPA to the Environmental Protection Agency last year included:

The EPA’s proposed regulation ― which would lower the threshold of ground-level ozone pollution ― has been characterized as “the most expensive regulation ever.”

President Obama nixed a similar version of this rule in 2011, claiming that he was acting to “underscore the importance of reducing regulatory burdens and regulatory uncertainty.” Yet many are wondering what happened to President Obama’s 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.

However, a recent study by the National Association of Manufacturers found that the new ozone regulation could have a very high cost in jobs and to the economy. The study found that a stricter new ozone regulation could:

  • Reduce U.S. GDP by $270 billion per year and $3.4 trillion from 2017 to 2040.
  • Result in 2.9 million fewer jobs per year on average through 2040.
  • Cost the average U.S. household $1,570 per year.
  • Increase natural gas and electricity costs for manufacturers and households across the country.

The EPA must make a final decision on the rule by October 1, 2015. 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.

Heavy regulations like this one cost too many jobs and wreck the economy. Businesses will choose to go to other countries with friendlier business environments, further negatively impacting our economy in the long run. We must look at the bigger picture and see the other side of the issue and understand that more harm than good is achieved through many existing regulations like this new one.

A domestic energy boom means nothing if the economy cannot rise with it — over a trillion dollars of estimated regulatory burden directly burdens job markets and wage growth. The American voters are clear: the economy and jobs remains their top concern; elected officials need to begin representing their constituents.

Feb 10, 2016 | 1 comment | by

Cruz’s Victory Against Ethanol Cartel

Most presidential candidates in the past would go to Iowa, the first state to cast a ballot for President of the United States, and proudly, boldly support ethanol and the Renewable Fuel Standard (RFS) ‒ even if they talked badly about it everywhere else in the nation.

However, Senator Ted Cruz set himself apart from all the others. Cruz voted to repeal the Renewable Fuel Standard. He stood up to the ethanol cartel, while he was campaigning very hard in Iowa. In response, the cartel mobilized an army to fight him, and they were defeated Monday night when he took first place in the Iowa Caucus.

The Renewable Fuel Standard (RFS) is a law requiring traditional fuel to have increasing blends of ethanol and later, other biofuels. However, the RFS plan has already failed.

 

Feb 03, 2016 | 2 comments | by

Murkowski Outlines Senate Energy Plan

In the GOP weekly address, Sen. Murkowski describes the Energy Policy Modernization Act, which includes liquid natural gas (LNG) exports. Looks like it is still on the Senate calendar this week…although it may slip.

On LNG exports, the bill requires the Energy Secretary to approve or disapprove LNG export applications within 45 days, so the applications don’t linger. That’s for nations that don’t already have free trade agreements with us, since most free trade agreements already address expedited LNG exports. It also puts federal energy regulatory commission (FERC) in control of all federal LNG authorizations.

The bill authorizes a new “e-prize” competition, which is basically an x-prize for energy. I’m seeing more and more of these x-prizes in public policy.

The section on nuclear power misses the opportunity to promote molten salt reactors, a nice byproduct of a robust rare earth element policy…but it does call for more nuclear reactor fusion and fission reactor prototypes, so that might encompass molten salt even if it isn’t listed specifically.

There are a ton of repeals and program eliminations, which is a good sign of conservative legislation.

  • Repeal of the methanol study.
  • Repeal of the weatherization study.
  • Repeal of various DOE programs.

Unfortunately, it also reauthorizes the Land and Water Conservation Fund, which is bad public policy.

Jan 25, 2016 | 1 comment | by

SOTU: President Obama’s Reckless Energy Policy

Last night, President Obama gave his final State of the Union (SOTU) address to the nation. He briefly discussed energy policy:

Seven years ago, we made the single biggest investment in clean energy in our history.  Here are the results.  In fields from Iowa to Texas, wind power is now cheaper than dirtier, conventional power.  On rooftops from Arizona to New York, solar is saving Americans tens of millions of dollars a year on their energy bills, and employs more Americans than coal – in jobs that pay better than average.  We’re taking steps to give homeowners the freedom to generate and store their own energy – something environmentalists and Tea Partiers have teamed up to support.  Meanwhile, we’ve cut our imports of foreign oil by nearly sixty percent, and cut carbon pollution more than any other country on Earth.

Gas under two bucks a gallon ain’t bad, either.

Now we’ve got to accelerate the transition away from dirty energy.  Rather than subsidize the past, we should invest in the future – especially in communities that rely on fossil fuels.  That’s why I’m going to push to change the way we manage our oil and coal resources, so that they better reflect the costs they impose on taxpayers and our planet.  That way, we put money back into those communities and put tens of thousands of Americans to work building a 21st century transportation system.

Seven years ago, President Obama said he would bankrupt the coal industry, he has come pretty close to doing just that. The American coal industry is on the verge of collapse, with around 50 companies out of business and stock prices of the big four companies have fallen as much as 99 percent! Most recently, the second largest coal company has filed Chapter 11 bankruptcy.

In addition to all the regulations placed on the coal industry by the Obama administration, natural gas has experienced a boom due to new discoveries and the advanced technologies of hydraulic fracturing and horizontal drilling. Natural gas recently passed coal as America’s top source of energy power.

Despite the President’s efforts and the natural gas boom, coal is still a major source of American energy power. While, renewable energy is only supplying 6 percent of our electric power.

Wind power and solar power are also not cheap, compared to energy options such as natural gas and coal. The savings that the President is referring to are the very high subsidies that both the federal government and some states have been giving to individuals for buying wind or solar. Also, I am sure he is adding in the possible savings over something like 20 or 50 years. Yet leaving out the very high initial installation and maintenance costs.

The President’s SOTU last night coverage a variety of topics, including the reckless energy policy over the past seven years. An energy policy that has unnecessarily put our coal industry on life support, at a high cost to taxpayers and energy consumers.

Jan 13, 2016 | Leave a Comment | by

U.S. House Energy Bill Debate Today

The House of Representatives starts the debate today on 38 amendments out of an original 103 submitted for H.R. 8 —North American Energy Security and Infrastructure Act of 2015 — and concludes discussion tomorrow. The 2015 energy bill would modernize energy infrastructure, build a 21st century energy and manufacturing workforce, bolster America’s energy security and diplomacy, and promote energy efficiency and government accountability.

Despite the President’s threat to veto the House bill, lawmakers from both parties have over one hundred amendments to the Energy and Commerce Committee’s broad energy bill to discuss in this week’s floor debate.

The amendments included many policy recommendations relating to energy, natural resources, infrastructure and grid security. Below are a few of the 38 amendments to be debated:

  • Rep. Joe Barton (R-Tex.) has filed an amendment to repeal the crude oil exports ban.
  • Sean Duffy (R-Wis.) is proposing to require the Secretary of Energy to collaborate with the Secretariat of Energy in Mexico and the Ministry of Natural Resources in Canada when developing guidelines to develop skills for an energy and manufacturing industry workforce.
  • Rep. Gene Green (D-Tex.) has offered an amendment that would establish a permitting process within DOE, the Federal Energy Regulatory Commission and the State Department for cross-border infrastructure projects.
  • Rep. Scott Peters (D-Calif.) has an amendment that includes energy storage as a form of energy that DOE should consider to enhance emergency preparedness for energy supply disruptions during natural disasters.
  • Rep. Trent Franks (R-Ariz.) has an amendment that secures the most critical components of America’s electrical infrastructure against the threat posed by a potentially catastrophic electromagnetic pulse.
Dec 02, 2015 | Leave a Comment | by

Renewable Fuel Standard Mandates, or Not?

The Renewable Fuels Standard (RFS) provisions of The Energy Independence and Security Act of 2007 (EISA), mandates an increasing blend of renewable products into our domestic fuel supply. The law amends the Clean Air Act, and allows for an initial blending of food-based ethanol (corn), beginning in 2008. In subsequent years, the blend was to transition towards satisfying the annually increasing volumes with non-food “second stage” cellulosic ethanol, referred to as RFS2. The cellulosic, or advanced biofuels, are derived from biological materials such as wood shavings, leaves, corn cobs and grasses. In addition to the blend provisions, the law requires the program to achieve a 20% reduction in greenhouse gas emissions. Unfortunately, the costly experiment has failed to meet several goals, including air quality and the defined blend requirements.

To explain, in 2008 Congress mandated the EPA to set the RFS at a 10% blend of corn ethanol. Drivers then began to see labels informing them of E10 in fuel pumps. By 2010, the law states we were to move towards the use of non-food products (the second-stage RFS2), to fill the increasing blend requirements. However, in 2010 and 2011, no cellulosic biofuel was available to fill the volume requirements. Similarly, in 2012 and 2013 the available production did not amount to 1% of the mandated levels. As a result, the EPA adjusted the blend formulas allowing for first stage corn-based ethanol to fill the void.

In 2011, the EPA approved the blend increase to E15 (15% ethanol). An increase mandated to include cellulosic renewables (non-food) as opposed to corn. Now, several years into the program, cellulosic biofuels are still not available. Nevertheless, the EPA should not continue to adjust the volumes between ethanol and biofuels. It was at the onset of the program in 2007 that the Department of Energy (DOE), assured the taxpayers cellulosic ethanol would be ready and cost competitive with gasoline by the year 2012. Again, yet another goal the program failed to meet. Incidentally, that promise accompanied an astounding $385 million federal investment in six privately owned plants.

Unfortunately, at this time technological realities and market fundamentals simply do not support large-scale production of cellulosic biofuels and the industry is not near capable of meeting the RFS2 mandates. The creation of a law does not guarantee that science and economics will cooperate. As we look at the legal requirements and limits of alternative fuels made from wood chips and corn cobs, one thing is wholly apparent. We can’t get there from here.

So then, where are we? In regards to the ethanol mandate, we are quite possibly near the end. It was a poorly drafted piece of legislation that is not sustainable without government backing. Aside from corn farmers and their lobbyist, there is little support for continuing the project. Unfortunately, and unavoidably, the same corn farmers who benefited from the program will suffer the greatest financial impact upon its demise.

Nov 30, 2015 | 6 comments | by

New NERA Study Details Economic Impact of Clean Power Plan

A new study by NERA Economic Consulting explains the economic impact from increased regulations from the federal government’s Clean Power Plan (CCP) in great detail. The CCP’s goal is to reduce carbon emissions from new and existing fossil-fueled power plants in the United States. States have the responsibility to meet the CPP goals. If they fail to come up with a carbon reduction plan or submit a plan that does not comply with CPP, the federal government steps in with their plan to meet the CPP goals. CPP goals include:

  • All compliance scenarios lead to large reductions in average CO2 emissions.
  • Reductions range from 19% to 21%.
  • By 2031, annual emissions are expected to be 36% to 37% lower than in 2005.

NERA estimates that the impact of the CPP on the energy sector, electricity rates and to the economy include:

  • Total energy sector expenditure from 2022 through 2033 increases range from $220 to $292 billion.
  • Annual average expenditures increase between $29 and $39 billion each year.
  • Average annual U.S. retail electricity rate increases range from 11%/year to 14%/year over the same time period.
  • Losses to U.S. consumers range from $64 billion to $79 billion on a present value basis over the same time period.

State-level average electricity price increases demonstrate that many states could experience significant price increases:

  • 40 states could have average retail electricity price increases of 10% or more.
  • 17 states could have average retail electricity price increases of 20% or more.
  • 10 states could have average retail electricity price increases of 30% or more.

The highest annual increase in retail rates relative to the baseline also shows that many states could experience periods of significant price increases:

  • 41 states could have “peak” retail electricity price increases of 10% or more.
  • 28 states could have “peak” retail electricity price increases of 20% or more.
  • 7 states could have “peak” retail electricity price increases of 40% or more.
Nov 18, 2015 | 2 comments | by

Tobacco: Top User of Agriculture Guest Worker (H-2A) Visa Program

With the run up to the 2016 presidential election, we have seen a growing debate on the need for border security versus the shortage of agriculture workers. Tales of apples rotting on trees and produce left in the field are offered as evidence of jobs Americans won’t do. Yet, according to the U.S. Department of Labor’s (DOL) Office of Foreign Labor Certification program, we have a record number of guest worker visa holders. In agriculture alone, the number of H-2A visa holders has risen nearly 35% in the past decade.

Visa Certifications

Considering the increase of H-2A visa holders, how is it those who grow our food are struggling to bring in their crops? Where are all the workers? Well, according to DOL reports, a majority are harvesting tobacco, working in landscape nurseries, and operating equipment. Annual reports show the tobacco industry is consistently the largest single sector employer of agriculture guest worker visa holders. In fact, a tobacco trade organization, the North Carolina Growers Association (NCGA), touts itself as the nation’s largest user of the H-2A agricultural “guest worker” program. And, though the Center for Disease Control (CDC) reports a steady decline in U.S. smokers, the industry is experiencing a growth in acres planted and yields.Visa Top 10

The resurgence comes after an initial dramatic decline in tobacco farming following the implementation of the Fair and Equitable Tobacco Reform Act of 2004 (FETRA). That legislation ended nearly 70 years of farm subsidies and marketing quotas. Then, beginning with the following year (2005), the feds stepped in with the Tobacco Transition Payment Program (TTPP). A program that paid nearly $9.6 billion to farmers for the lost value of their marketing quotas over a ten-year period. Also, with the low costs guest workers and the benefit of federal export assistance, the industry has gained a world of new consumers through exporting. For those health conscious consumers, tobacco now qualifies for certification under the USDA’s National Organic Program (NOP).

As well, according to a recent report by the Federal Trade Commission (FTC), in 2012, tobacco companies spent $9.6 billion marketing cigarettes and smokeless tobacco in the United States alone. An amount of about $26 million each day, or more than $1 million an hour. Not to mention federal funds at work to assist in identifying medicinal uses for tobacco.

It may appear the relationship between tobacco farming and the government makes no sense, but it actually makes an awful lot of cents. In 2014 alone, federal revenue from tobacco tax amounted to $15.56 billion dollars. Projections through 2020 show an anticipated $157.12 billion into government coffers (no pun intended). American tobacco farming is a windfall tax source for the federal government.

In summary, tens of thousands of agriculture guest workers are designated to work in tobacco while food products go unharvested. The government spends billions to burn food for fuel in its failed ethanol experiment. We have an unprecedented amount of illegal immigration due to a broken system. It goes to show, even a practical program, as is the H-2A visa, government involvement inevitably distorts the original intent.

Nov 18, 2015 | 3 comments | by
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