2016

EPA claims carbon capture and storage (CCS) is the “adequately demonstrated” best system of emission reduction (BSER) for new coal-fired power plants. Is it?

“Adequately demonstrated” roughly means commercially viable. In its so-called Carbon Pollution Standards rule for new fossil-fuel power plants, finalized last October, EPA repeatedly sites SaskPower’s Boundary Dam 3 project in Saskatchewan as evidence CCS technology is ready for prime time.

However, the New York Times reports this week, Boundary Dam 3 “has been plagued by multiple shutdowns, has fallen way short of its emissions targets, and faces an unresolved problem with its core technology. The costs, too, have soared, requiring tens of millions of dollars in new equipment and repairs.”

Superficially, Boundary Dam 3 looks like an ideal candidate for CCS technology. “Hundreds of years of coal reserves are buried under the ground nearby, virtually eliminating transportation costs.” The project “received a major Canadian subsidy.” It has a 10-year contract to sell captured CO2 to Cenovus Energy, which injects the gas underground to extract “tertiary” oil from older wells — a process known as enhanced oil recovery (EOR).

Yet recently released confidential internal documents show that instead of capturing 90% of the plant’s CO2 as intended, the system is working at “only 45 percent of capacity.” One document “cited eight major problem areas. Fixing them, it said, could take a year and a half, and the memo warned that it was not immediately apparent how to resolve some problems.”

Worse:

A chart covering the first year of operation showed that the system often didn’t work at all. When it was turned back on after shutdowns for adjustments and repairs, the amount of carbon captured sometimes even dropped.

One shutdown last year cost the company C$17 million, and repeated shutdowns have forced SaskPower to miss CO2 deliveries to Cenovus. The penalties totaled C$7 million, canceling out most of the C$9 million in sales.

A more permanent challenge is the energy penalty inherent in CCS technology:

On top of that, the carbon system is a voracious consumer of the electricity generated by Boundary Dam, which has 150 megawatts of capacity. [SaskPower CEO] Mr. [Mike] Marsh testified that about 30 megawatts of capacity were consumed by the system, and an additional 15 to 16 megawatts were needed to compress the carbon dioxide.

Tim Boersma, the acting director of the energy security and climate initiative at the Brookings Institution, said that extensive power loss is a significant factor keeping other utilities from following SaskPower’s lead.

“That is exactly the reason this is not going to fly,” Mr. Boersma said. “The plant’s efficiency goes down so dramatically.”

So much for the gory details. Let’s consider the big picture. [click to continue…]

E&E news reporter Monica Trauzzi yesterday interviewed Bob Dinneen, President and CEO of the Renewable Fuels Association (RFA). They discussed the future of the Renewable Fuel Standard (RFS). Today’s post will examine one of Dinneen’s answers that is dense with misinformation. Before examining it, though, some basic background may be helpful.

Background

The RFS is a central planning scheme requiring specified volumes of biofuels to be sold in the nation’s motor fuel supply over a 17-year period. As incorporated into the Clean Air Act by the so-called Energy Independence and Security Act (EISA) of 2007, the quota for total renewable fuels increase from 4 billion gallons in 2006 to 36 billion gallons in 2022.

The RFS, however, also authorizes the Environmental Protection Agency to make annual adjustments to the quota (known as Renewable Volume Obligations or RVOs) if the administrator determines there is an “inadequate domestic supply.”

Renewable fuel lobbyists have been castigating EPA ever since November 2013 when the agency, for the first time, proposed to reduce the statutory targets based on the “blend wall” — a set of market constraints limiting the supply of biofuels that can actually be sold to consumers.  Although the final RVOs adopted by EPA in November 2015 restored much of the cutbacks proposed in 2013, Dinneen and other renewable fuel lobbyists continue to cry foul and demand that EPA force refiners to buy ethanol at the statutory volumes.

Contrary to popular misconception, the RFS does not expire after 2022. Rather, the Clean Air Act leaves it up to EPA to decide post-2022 targets based on the agency’s assessment of various factors such as the impacts of biofuel production and use on the environment, energy security, and job creation.

Bumper Crop of Misinformation

Monica Trauzzi: So you need the RFS post-2022?

Bob Dinneen: Again, until there is a truly free marketplace. You know, ethanol is not subsidized today. The only liquid transportation fuel that receives a subsidy from the taxpayer is, oh, oil. You know, we’re paying refiners to drill deeper in the Gulf of Mexico and to frack in North Dakota and Texas. We aren’t subsidized. I want to see the renewable fuels industry continue to evolve. I want to see new technologies. I want to see new feedstocks. I want to see us get beyond the 10 percent blend wall. All of that happens if the EPA grows a backbone and implements this program in the way that it was intended to be implemented so that refiners have to invest in the infrastructure to allow E85, to enable E15 to be sold. It’s not that hard.

Dinneen has made those points before, so he’s not speaking off the cuff but presenting a settled position. Time for a fact check. [click to continue…]

Reps. Ted Lieu (D-Calif.), Peter Welch (D-Vt.), and Matt Cartwright (D-Penn.) are at it again. In October, they asked Securities and Exchange Commission Chair Mary Jo White to “investigate ExxonMobil’s past filings to determine whether security laws were violated by failing to disclose material risks related to climate change.” This week they asked her to investigate Shell Oil’s filings to determine if the company “similarly violated securities laws by not properly disclosing climate-related risks.”

Lieu et al. claim the oil companies have known for decades about the seriousness of climate change risks, yet hid those risks from the public by funding ‘denier’ groups. As evidence, they cite an L.A. Times article titled “Big oil braced for global warming while it fought regulations.” The Times reporters claim both companies made significant investments to protect their facilities from sea-level rise, hence must have known how dangerous climate change is. Let’s see if there is anything to that line of argument. [click to continue…]

In a recently filed shareholder resolution, an activist group called the Nebraska Peace Foundation (NPF) asks Berkshire Hathaway’s insurance division to prepare a report describing the division’s responses to climate change risks. The report “should include specific initiatives and goals relating to each risk issue identified.” In a letter to shareholders dated February 27, 2016, Berkshire Hathaway Chairman and CEO Warren Buffett explains why Board of Directors unanimously opposes the resolution.

Today’s post examines Buffett’s argument, which straddles fences in ways you might not expect. Before diving into it, I should note that NPF owns exactly one share of Berkshire Hathaway stock. That’s enough to entitle NPF to submit a shareholder resolution but nowhere near enough to give those ‘investor activists’ a stake in the company’s financial health.

For years climate campaigners have used shareholder resolutions to demand that companies with fossil-fuel investments or customers confess their unsustainability in the supposedly inevitable carbon-constrained future. The classic case is Campaign ExxonMobil. In the name of protecting shareholder value, the campaigners tried to persuade Exxon to scare away its own investors–a tactic that, if successful, would bankrupt the company and harm shareholders. NPF is part of the same movement, although its goal may simply be to turn Berkshire Hathaway into yet another multi-billion dollar mouthpiece for the so-called climate consensus.

The remainder of this post reproduces the portion of Buffett’s letter that explains why the Board opposes the NPF resolution (pp. 24-25). Buffett’s text is in maroon and preceded by the initials WB. My comments are in standard black and indented.

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In a joint letter yesterday, more than 100 scientists, including Kerry Emmanuel (MIT), James Hansen (Columbia University), and Michael Mann (Penn State University), urged American Geophysical Union (AGU) President Margaret Leinen to “reconsider” (i.e. terminate) ExxonMobil’s sponsorship of the association’s Fall meetings. Climatewire ($) provides some useful context:

AGU’s meeting is the largest earth science conference in the world. It attracts tens of thousands of scientists and requires a conference space so large that it is used by Apple Inc. and Google Inc. for their yearly developer meetings. There are hundreds of sessions on the science of climate change. Exxon Mobil is a prominent sponsor and recruiter at the meeting and paid AGU $35,000 last year.

Leinen declined to give ExxonMobil the boot. As explained yesterday on her blog (h/t Anthony Watts), AGU’s Board discussed allegations that ExxonMobil is promoting “misinformation about climate change, climate science and the role of human activity in climate change, or actively supporting organizations that do,” and concluded that “ExxonMobil’s current public statements and activities were not inconsistent with AGU’s positions and the scientific consensus.” However, expulsion remains an option if, in the future, the company deviates from AGU’s positions:

As the leaders of AGU, we welcome questions and requests from our members and others in the scientific community, and we assure you that if verifiable information becomes available that proves ExxonMobil is currently engaging in the promotion of misinformation about science or adopting positions that are in conflict with AGU’s own, or supporting groups that do, we will end the relationship, as dictated by our policy–at least until the company is able to demonstrate that such actions have ceased.

Hardly a profile in courage. Indeed, Leinem and the Exxon bashers tacitly agree that AGU’s role is not to facilitate debate of competing scientific viewpoints but to define and enforce a party line. [click to continue…]

Will EPA abide by the stay placed on the agency’s so-called Clean Power Plan last week by the Supreme Court? Or will EPA continue to implement the rule–albeit in the guise of providing assistance to states?

The question is legitimate because the Power Plan itself exposes EPA as a rogue agency. As attorneys David Rivkin and Andrew Grossman explain in the Wall Street Journal:

It’s one thing for a rule to be unlawful—which happens, and rarely merits a stay—but another for it to be lawless. This one was lawless. That is why the court had to act: to reassert the rule of law over an executive who believes himself above it.

EPA administrator Gina McCarthy equivocated when explaining the agency’s policy regarding the stay. As my colleague Myron Ebell noted in the Cooler Heads Digest:

She told the House Agriculture Committee during a three-hour grilling that “Nothing is going to be implemented while the stay is in place. It is clearly on hold until it resolves itself through the courts.” But when McCarthy addressed state air regulators, she said that the EPA would work with any State that wanted to keep working on implementing the rule. Several reporters described her attitude in the speech as defiant. 

Here are McCarthy’s exact words, as reported in The Hill:

“Are we going to respect the decision of the Supreme Court? You bet, of course we are,” she said.

“But it doesn’t mean it’s the only thing we’re working on and it doesn’t mean we won’t continue to support any state that voluntarily wants to move forward.”

That doesn’t cut it. The stay requires EPA to cease implementing the Power Plan until the D.C. Circuit Court of Appeals, or the Supreme Court, renders a final decision on litigation to overturn the rule. That process may take years to complete. If, in the interim, EPA supports state efforts to implement the rule, whether by providing advice, technical assistance, coordination, or mere cheer leading, it will itself participate in implementation. Exactly what the stay prohibits. [click to continue…]

A few weeks ago, the New York Times published an article that not-so-subtly takes the side of 35 Senators and 62 institutional investors who want the Securities and Exchange Commission (S.E.C.) to force fossil-energy companies to confess their unsustainability in a carbon-constrained world.

It’s the old self-fulfilling prophesy trick. Adopt lawless regulations aimed at bankrupting fossil-energy companies, lock in those regulations through a non-ratified treaty that dare not speak its name, then coerce those companies into scaring away shareholders, and presto, many will in fact go bankrupt. As their numbers and resources decline, so will their ability to defend themselves against further regulatory attack.

Translating into Borg-speak: “Freedom is irrelevant. Constitution is irrelevant. Your economy will adapt to service us.”

But resistance is not futile. Fossil fuels remain the world’s most affordable energy source for poverty eradication. What’s truly unsustainable is the green project to put an energy-starved world on an energy diet.

The Supreme Court just handed Obama and the EPA a major setback. And for all we know at this point, the next President and Congress will thwart EPA’s Power Grab and Obama’s attempt to bypass Senate review of the Paris climate treaty.

I wrote a short letter to the Times on the S.E.C. article. The editor did not publish it, so I will post it here. [click to continue…]

The Supreme Court’s decision to put a stay on EPA’s so-called Clean Power Plan took nearly everyone by surprise. The D.C. Circuit Court of Appeals had already scheduled an expedited review of the Power Plan, and, as the New York Times observed, “the Supreme Court had never before granted a request to halt a regulation before review by a federal appeals court.”

The stay is a major setback for the global warming movement. The Power Plan is President Obama’s signature domestic climate policy as well as the sheet anchor of his emission-reduction pledge to the United Nations in the Paris climate treaty negotiations. The stay not only puts the Plan on ice pending final resolution of complex litigation on the merits, a process that could take years, it also indicates that five justices have serious doubts about the Plan’s legality.

The usual suspects were quick to condemn the stay as a partisan decision, a product of coal-fired, oil-fueled Republican politics. A typical Orwellian inversion by rank partisans who would never admit, no matter how overwhelming the evidence, that the Power Plan is an unlawful power grab.

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CEI’s discovery in late 2012 of then-EPA Administrator Lisa Jackson’s false-identity “Richard Windsor” email account drew a fair amount of attention at the time.  Some media outlets, realizing they may have been getting the runaround from the “most transparent administration, ever” along with the rest of us, set off on broader campaigns to root out other tricks.  A Windsor-inspired AP inquiry prompted headlines like these.

CEI was forced to sue to get the Windsor emails it at first sought.  The first revelations, from just emails with certain “climate”-related keywords, painted a picture of an agency out of control, sweating the policy sheets with media allies and green group lobbyists…the few they hadn’t brought in-house to ply their trade. We then sought all emails on that false-flag account.   EPA said it would slow-walk this second request to the pitiful tune of 100 emails per month, for the next century.  So we sued.

In the meantime, the Windsor affair became notorious while leaving some in the media confused, possibly unsure that this was such a bad thing so long as it was the right kind of administration doing these things.  As recently as last month it was still being twisted by apologists at the Washington Post, whose reportage of yet another investigation sparked by Windsor included pure invention: “The 2012 request by CREW was sparked by the discovery that Lisa Jackson, then-administrator of the Environmental Protection Agency, had been using an alias email at work with the name “Richard Windsor,” largely for personal communication.”

There having been a handful of personal-ish emails among the many tens of thousands of responsive pages— which are largely available, specifically set-aside, online — this is simply made up.  In fact this email account was Jackson’s principal account for corresponding with senior EPA officials, other cabinet officers, White House staff, and the odd lobbyist (CEI’s litigation also revealed that Jackson used her actual personal account, with Verizon, used for corresponding with lobbyists from industry and green pressure groups).

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