All posts by Roger Straw

Editor, owner, publisher of The Benicia Independent

California legislators unveil measures to combat climate change

Repost from The Santa Cruz Sentinal

Proposals unveiled to combat climate change

By Paul Rogers, Bay Area News Group, 02/10/15

SACRAMENTO >> California lawmakers on Tuesday unveiled a package of bills to significantly expand renewable energy use in California, cut gasoline use by 50 percent and require the state’s major government pension funds to sell off investments in coal companies.

The four measures, proposed by Democratic leaders in the state Senate, mirror many of the goals set out by Gov. Jerry Brown in his State of the State speech last month. Opposed by oil companies and praised by environmental groups, the bills would extend California — which already had the nation’s toughest climate and renewable energy laws — to a new level in setting environmental policy for other states.

“We need to move the state away from fossil fuels, away from the grip of oil,” said Senate President Pro Tem Kevin de Leon, D-Los Angeles. “This is common sense climate policy.

Given that Democrats have large majorities in both the Senate and the Assembly, their prospects for passage are considered high.

The bills were introduced Tuesday at an afternoon news conference in Sacramento.

They are:

SB 350 (By Sen. Kevin de León, D-Los Angeles, and Sen. Mark Leno, D-San Francisco) >> Would require that by 2030, California utilities generate at least 50 percent of their electricity from solar, wind and other renewable energy sources, an increase from the current law which requires 33 percent renewable by 2020, and which the utilities are now on target to meet. The bill also would require state agencies to toughen building standards to require a 50 percent increase in energy efficiency in buildings from now until 2030. And it would require the California Air Resources Board to reduce petroleum use by cars and trucks by 50 percent from now until 2030, most likely through rules limiting greenhouse gas emissions from new vehicles, new incentives for electric vehicle purchases and rules requiring lower carbon content of petroleum fuels.

SB 185 (DeLeon) >> Would require that the California Public Employees Retirement System and the State Teacher’s Retirement System divest from companies with 50 percent or more of their revenues in coal mining or coal burning. CalPERS alone has assets of $295 billion, yet only has coal holdings totaling less than 1 percent of that amount, or $167 million.

SB 32 (Sen. Fran Pavley, D-Agoura Hills) >> Extends California’s landmark climate law, AB 32. The current law, signed by Gov. Arnold Schwarzenegger in 2006, requires California to cut greenhouse gas emissions to 1990 levels by 2020, a reduction of about 20 percent from “business as usual.” The state is on target to meet that goal. The new bill would go much further, locking into law a goal that Schwarzenegger had set: cutting greenhouse gas emissions 80 percent below 1990 levels by 2050. The bill, if passed, would require the California Air Resources Board to set new rules to meet the standards, and likely would involve further crackdowns and fees on the oil industry, petroleum power plants and gas-burning vehicles, with more incentives for renewable energy and electric vehicles.

SB 189 (Sen. Ben Hueso, D-San Diego) >> Would establish a seven-member expert committee to advise and inform annually the Legislature annual on clean energy and climate policies that could create jobs and spread economic benefits to all economic levels of society.

Although many industry leaders were waiting for the formal rollout of the bills to comment, billionaire Tom Steyer, a former San Francisco hedge fund manager who has helped fund efforts to reduce greenhouse gases and other air pollution, praised the measures.

“These are achievable policy proposals that will create good-paying green jobs here in California, mitigate the impact of climate change, and leave a cleaner, safer, more stable world for the next generation,” Steyer said.

“At a time when our state is faced with the choice between moving backwards by accepting the fossil fuel industry’s status quo or embracing a clean energy future for our state, this new legislative package includes commonsense proposals that will move California forward.”

AP: Oil on wild ride: How will it end?

Repost from The Seattle Times (AP)

Oil on wild ride: How will it end?

Predicting oil prices is especially tricky now because the oil market has never quite looked like this. Oil-price collapses of the past were triggered either by plummeting demand or an increase in supplies. This latest one had both.

By JONATHAN FAHEY, 2/10/15

An oil well owned by Apache Corp. in the Permian Basin in Texas. As prices have fallen globally, many U.S. communities that depend on oil revenue are bracing for hard times.
An oil well owned by Apache Corp. in the Permian Basin in Texas. As prices have fallen globally, many U.S. communities that depend on oil revenue are bracing for hard times. | Spencer Platt / Getty Images

NEW YORK — The price of oil is on a wild ride, and there is little agreement on where it’s headed.

After falling nearly 60 percent from a peak last June, the price of oil bounced back more than 20 percent as January turned to February. Then, on Tuesday, it sank 5 percent, closing just above $50.

Oil has fallen or risen by 3 percent or more on 14 of 27 trading days so far this year. By comparison, the stock market hasn’t had a move that big in more than three years.

Predicting prices is especially tricky now because the oil market has never quite looked like this. Oil price collapses of the past were triggered either by plummeting demand or an increase in supplies. This latest one had both.

Production in the U.S. and elsewhere has been rising, while slower economic growth in China and weak economies in Europe and Japan mean demand for oil isn’t growing as much as expected.

As recent trading shows, any sign of reduced production inspires traders to buy oil, and every new sign of rising supplies sends prices lower. In a report Tuesday the U.S. Energy Department, citing unusual uncertainty, said the price of oil could end up anywhere from $32 to $108 by December.

“There are many more laps to come on this roller coaster,” said Judith Dwarkin, chief economist at ITG Investment Research.

As oil bounces up and down, so will the price of gasoline, diesel and other fuels. Almost no one expects a return to the very high prices of the past four years, so drivers and shippers will continue to pay lower prices. It’s a question of how much less, and for how long.

Those expecting a quick and lasting price jump see mounting evidence that drillers in the U.S. are pulling back fast because they’re no longer making money. A closely watched survey by the oil-services company Baker Hughes shows that the number of rigs actively drilling for oil fell to 1,140 last week, down 29 percent from a record high of 1,609 in October.

Oil companies have announced spending cuts in the billions of dollars; oil-service companies have announced layoffs of thousands of workers.

If companies stop drilling new wells in North Dakota and Texas, the centers of the U.S. oil boom, overall U.S. production could fall fast. Output from most of those wells declines far more quickly than production from more traditional wells. Analysts at Bernstein Research estimate that U.S. production declines at 30 percent a year without constant investment in new wells.

A quick decline in production would send prices higher by reducing global supplies. At the same time, demand could be on the rise. The U.S. economy seems to be improving rapidly, and demand for gasoline is increasing. Global demand may also rise somewhat simply because low prices tend to encourage more consumption.

If the oil bulls are right, it means prices for transportation fuels would rise and the slowdown in drilling activity in the U.S. would perhaps be short-lived.

Others say oil production is still rising and demand isn’t yet catching up — a recipe for lower oil prices.

The oil bears argue that there are plenty of rigs still working, and they are now focused only on the most prolific spots. Also, oil-services companies are charging significantly less for equipment and expertise. This means oil companies may be able to keep oil supplies rising from already high levels despite low prices.

The Energy Department reported last week that there was a record 1.18 billion barrels of oil in storage in the U.S. ITG’s Dwarkin estimates that in the first half of this year the world will be producing, on average, 2 million barrels per day more than it will be consuming.

Analysts at Bank of America Merrill Lynch say $32 a barrel is possible. Ed Morse, an analyst at Citi, called the recent rise in prices a “head fake” and predicts oil could plunge into the $20 range, the lowest since 2002.

The bears also don’t expect much increase in demand. Many developing nations are cutting back on fuel subsidies, which means that consumers could be buying less fuel, not more.

And demand in the United States and other developed nations won’t rise much, they argue, because of environmental policies and high fuel taxes.

After its recent rise, some think oil may already be close to finding its level.

The International Energy Agency said in a report Tuesday that prices will stabilize in a range “higher than recent lows but substantially below the highs of the last three years.”

In the past, once production went offline it took years to bring it back. Now, the IEA said, drillers can quickly and easily tap shale deposits to bring new oil to market as soon as supplies fall or demand rises. That should help keep a lid on prices.

Tom Pugh, an analyst at Capital Economics, forecasts that Brent crude, the most important benchmark for global crude, will end the year around $60 a barrel, within $4 of where it closed Tuesday — and to be at $70 by the end of 2020.

That doesn’t mean, however, that there won’t be further bumps along the way. “We wouldn’t be surprised to see more large price movements before the market settles down,” Pugh wrote.

 

Palo Alto passes fossil fuel divestment resolution

Press Release from Peninsula Interfaith Climate Action (PICA)

Interfaith Victory: Palo Alto Fossil Fuel Divestment Resolution Passed

PALO ALTO, CA — February 9, 2014.

The City of Palo Alto, responding to concerns from Peninsula Interfaith Climate Action (PICA), voted unanimously to send a message to CalPERS (California Statement Employee Retirement System), the national’s largest pension fund, to pull its investments out of fossil fuels.

Councilmembers Marc Berman, Patrick Burt, Karen Holman and Liz Kniss submitted the initial “Colleague’s Memo” in favor of divestment. “Climate change poses a top-tier threat to our future. Our obligation to address climate change through all avenues requires support from all sectors,” noted Council member Cory Wolbach. “I was inspired to see the passionate and effective work of these congregations collecting 152 signed letters on behalf of fossil fuel divestment.  Those letters, presented by a cross-denominational coalition, sent a very powerful moral statement.”

Eileen Altman is an associate minister at First Congregational Church in Palo Alto and a PICA member who spoke at the City Council meeting. “As Christians, we share a core set of values and concern for God’s gift of life, both human and all other life. Our investments should reflect our values.” said Rev. Altman. “This concern is not a liberal or conservative value, but is a Christian value. The US political system unproductively magnifies differences when Americans everywhere share 98% of the same values. Climate is about the future of our children and is especially about the people who are most vulnerable to the effects of climate change. Climate is the biggest social justice issue of our time. From the pews in Palo Alto and throughout the United Church of Christ, the first denomination to pass a resolution to move toward divestment from fossil fuels (in 2013), we welcome the opportunity to respectfully dialogue about climate with churches in all regions of the country and across all party affiliations.”

While the call for fossil fuel divestment may have its strongest impact as a symbolic statement, it also has practical implications for the economic value of employee pensions, explained Debbie Mytels, convener of PICA, which comprises a dozen local congregations that submitted signed letters to the Council in favor of the divestment resolution.

“While we believe it’s a moral obligation to stop using the fossil fuels that are causing sea level rise, extreme weather events and drought-related crop losses,” Mytels said, “it’s also important to question how long investments in these companies will be financially valuable.”

“If we want to protect our employees’ pensions, we need to get CalPERS to pull out of dirty fuels before they become ‘stranded assets’.” said Mytels, citing a recent statement by Deutsche Bank in Germany that said  “to meet climate change targets, over half of identified fossil fuel reserves will have to stay in the ground.”

“While we are pleased with Palo Alto’s progress in becoming a city that supplies ‘carbon free’ electricity to its utility customers,” Mytels said, “we feel it’s time for our city to demonstrate further leadership by joining the call for divestment.”

“Thankfully, Palo Alto itself does not own any investment in fossil fuels of any sort — that’s all the more reason for the Council to consider the long-term safety of our employees’ CalPERS retirement assets,” she added.

Reverend Will Scott, from California Interfaith Power & Light (CIPL), noted that “CIPL and our growing statewide network of more than 640 congregations are grateful for the inspiring work of the Peninsula Interfaith Climate Action group, now a CIPL Regional Working Group. Their regular, committed, and personal engagement on the local level as people of diverse faiths concerned about the climate crisis, is a strong model for other regional working groups in our network. Indeed, they are exemplifying the sincere, collaborative, practical, rooted and creative community resiliency needed throughout the world to meet the seriousness of this global challenge. California Interfaith Power & Light is learning much from PICA’s practices and shared wisdom.”

Palo Alto now joins a growing group of California cities, including San Francisco, Oakland, Berkeley, Brisbane, Richmond, Fairfax, and Santa Monica in calling for dropping fossil fuels from employee pension funds. Sunnyvale may be the next city. Other regional agencies, including the Santa Clara Valley Water District, which is mandated to protect Silicon Valley citizens from floods, have also passed similar resolutions due to concerns about sea level rise.

In advance of Global Divestment Day, Feb. 13, 2015, Norway announced last week that it would drop coal and tar sands companies from its national investment portfolio. Similarly, the Rockefeller Brothers Fund has made such a decision, along with 50 other philanthropic organizations. The divestment movement is also growing significantly among national faith-based groups, and nearby Stanford University has agreed to eliminate its holdings in coal companies. Today, California State Senate President Kevin de Leon introduced SB 185, directing CalPERs to divest coal fossil fuel investments.

For more information about PICA, see http://www.interfaithpower.org/pica and http://pica.nationbuilder.com/

City of Palo Alto Fossil Fuel Divestment Resolution.

The Palo Alto City Council voted unanimously in favor of divestment:  https://pbs.twimg.com/media/B9dpI7FCQAAfghe.jpg

PICA members celebrate: https://pbs.twimg.com/media/B9dpI7JCIAAsuEF.jpg

For more information about the international fossil fuel divestment movement, see http://gofossilfree.org/

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California Pledges Changes in Protecting Underground Water

Repost from ABC News (AP)

California Pledges Changes in Protecting Underground Water

By Ellen Knickmeyer, AP, Feb 9, 2015

California has proposed closing by October up to 140 oilfield wells that state regulators had allowed to inject into federally protected drinking water aquifers, state officials said Monday.

The deadline is part of a broad plan the state sent the U.S. Environmental Protection Agency last week for bringing state regulation of oil and gas operations back into compliance with federal safe-drinking water requirements. State authorities made the plan public Monday.

An ongoing state review mandated by the EPA found more than 2,500 oil and gas injection wells that the state authorized into aquifers that were supposed to be protected as current or potential sources of water for drinking and watering crops.

An Associated Press analysis found hundreds of the now-challenged state permits for oilfield injection into protected aquifers have been granted since 2011, despite the state’s drought and growing warnings from the EPA about lax state protection of water aquifers in areas of oil and gas operations.

Steve Bohlen, head of the state Department of Conservation’s oil and gas division, told reporters Monday that the proposed regulatory changes were “long overdue.”

EPA spokeswoman Nahal Mogharabi said Monday that federal authorities would review the new state plan over coming weeks. “EPA will then work with the State to ensure that the plan contains actions that will bring their program into compliance with the Safe Drinking Water Act,” Mogharabi said. She referred to landmark 1974 legislation that sought to protect underground drinking-water sources from oil and gas operations.

Bohlen said 140 of those 2,500 injection wells were of primary concern to the state now because they were actively injecting oil-field fluids into aquifers with especially good water quality.

State water officials currently are reviewing those 140 oil-field wells to see which are near water wells and to assess any contamination of water aquifers from the oil and gas operations, Bohlen said.

Part of the state plan released Monday would set an Oct. 15 deadline to stop injection into those water aquifers deemed most vital to protect them from contamination. State officials also could shut down oil field wells sooner if they are deemed to jeopardize nearby water wells, authorities said. This summer, the state ordered oil companies to stop using at least nine oil field wells that altogether had more than 100 water wells nearby.

The U.S. EPA had given the state until Friday to detail how it would deal with current injection into protected water aquifers and stop future permitting of risky injection.

While some of the fluids and materials that oil companies inject underground as part of normal production is simply water, some can contain high levels of salt or other material that can render water unfit for drinking or irrigating crops.

California is the nation’s third-largest oil-producing state, and oil companies say the kind of injection wells under scrutiny are vital to the state’s oil production.

Tupper Hull, a spokesman for the Western State Petroleum Association, said the oil-industry group feared state regulators would not be able to meet all the deadlines they were setting for compliance with federal water standards.

If that happens, oil producers “would be put into the untenable position of having to shut in wells or reduce production,” Hull said.