Category Archives: Fossil fuel divestment

California Refineries: Gas Stations of the Pacific Rim?

Repost from the Sunflower Alliance, May 16, 2024

Oil companies try to scare us away from limiting fuel production by saying it would increase prices.  But demand for fossil fuels is actually decreasing in California and throughout the US West.  This should be a good reason for ramping down production.  Instead, California refineries are pivoting to export an increasing amount of their products—now about 1/3—including the dirtiest fuel, petcoke.

This  map shows where California refinery fuel exports go.

Click the image to enlarge. | Image from” Community Energy reSource Comments – Refinery fuel exports map and table, annotated,” submitted in reference to Project “SB X1-2 Implementation,” Docket No. 23-SB-02, May 16, 2024 (TN# 256434).

Read the important comment submitted by Community Energy ReSource to the California Energy Commission for its process of implementing SB X1-2, the California Gas Price Gouging and Transparency Law.

Key quote:  “Refiners in California have already pivoted toward export of the dirtiest-burning fuels they refine here.  Now a crucial question arises: Instead of phasing down oil refining as the state moves toward zero emission vehicles, will refiners here pivot to export more and more of their ongoing fuels production? Tracking exports from refineries in California matters.”

Putin’s war shows autocracies and fossil fuels go hand in hand. Here’s how to tackle both

Democracies are making more progress than autocracies when it comes to climate action. But divestment campaigns can put pressure on the most recalcitrant of political leaders
Autocrats are often directly the result of fossil fuel. Composite: The Guardian/Getty Images

The Guardian, by Bill McKibben, Mon 11 Apr 2022

At first glance, last autumn’s Glasgow climate summit looked a lot like its 25 predecessors. It had:

  • A conference hall the size of an aircraft carrier stuffed with displays from problematic parties (the Saudis, for example, with a giant pavilion saluting their efforts at promoting a “circular carbon economy agenda”).
  • Squadrons of delegates rushing constantly to mysterious sessions (“Showcasing achievements of TBTTP and Protected Areas Initiative of GoP”) while actual negotiations took place in a few back rooms.
  • Earnest protesters with excellent signs (“The wrong Amazon is burning”).

But as I wandered the halls and the streets outside, it struck me again and again that a good deal had changed since the last big climate confab in Paris in 2015 – and not just because carbon levels and the temperature had risen ever higher.

The biggest shift was in the political climate. Over those few years the world seemed to have swerved sharply away from democracy and toward autocracy – and in the process dramatically limited our ability to fight the climate crisis. Oligarchs of many kinds had grabbed power and were using it to uphold the status quo; there was a Potemkin quality to the whole gathering, as if everyone was reciting a script that no longer reflected the actual politics of the planet.

Now that we’ve watched Russia launch an oil-fired invasion of Ukraine, it’s a little easier to see this trend in high relief – but Putin is far from the only case. Consider the examples.

Brazil, in 2015 at Paris, had been led by Dilma Rousseff, of the Workers’ party, which had for the most part worked to limit deforestation in the Amazon. In some ways the country could claim to have done more than any other on climate damage, simply by slowing the cutting. But in 2021 Jair Bolsonaro was in charge, at the head of a government that empowered every big-time cattle rancher and mahogany poacher in the country. If people cared about the climate, he said, they could eat less and “poop every other day”. And if they cared about democracy, they could … go to jail. “Only God can take me from the presidency,” he explained ahead of this year’s elections.

A climate activist holds a sign depicting Jair Bolsonaro with the slogan ‘Exterminator of the Future’. Photograph: Luis Robayo/AFP/Getty Images

Or India, which may turn out to be the most pivotal nation given the projected increases in its energy use – and which had refused its equivalent of Greta Thunberg even a visa to attend the meeting. (At least Disha Ravi was no longer in jail).

Or Russia (about which more in a minute) or China – a decade ago we could still, albeit with some hazard and some care, hold climate protests and demonstrations in Beijing. Don’t try that now.

Or, of course, the US, whose deep democratic deficits have long haunted climate negotiations. The reason we have a system of voluntary pledges, not a binding global agreement, is that the world finally figured out there would never be 66 votes in the US Senate for a real treaty.

Joe Biden had expected to arrive at the talks with the Build Back Better bill in his back pocket, slap it down on the table, and start a bidding war with the Chinese – but the other Joe, Manchin of West Virginia, the biggest single recipient of fossil fuel cash in DC, made sure that didn’t happen. Instead Biden showed up empty-handed and the talks fizzled.

And so we were left contemplating a world whose people badly want action on climate change, but whose systems aren’t delivering it. In 2021 the UN Development Programme conducted a remarkable poll, across the planet – they questioned people through video-game networks to reach humans less likely to answer traditional surveys. Even amid the Covid pandemic, 64% of them described climate change as a “global emergency”, and that by decisive margins they wanted “broad climate policies beyond the current state of play”. As the UNDP director, Achim Steiner, summarized, “the results of the survey clearly illustrate that urgent climate action has broad support amongst people around the globe, across nationalities, age, gender and education level”.

The irony is that some environmentalists have occasionally yearned for less democracy, not more. Surely if we just had strongmen in power everywhere they could just make the hard decisions and put us on the right path – we wouldn’t have to mess with the constant vagaries of elections and lobbying and influence.

But this is wrong for at least one moral reason – strongmen capable of acting instantly on the climate crisis are also capable of acting instantly on any number of other things, as the people of Xinjiang and Tibet would testify were they allowed to talk. It’s also wrong for a number of practical ones.

Those practical problems begin with the fact that autocrats have their own vested interests to please – Modi campaigned for his role atop the world’s largest democracy on the corporate jet of Adani, the largest coal company in the subcontinent. Don’t assume for a minute that there’s not a fossil fuel lobby in China; right now it’s busy telling Xi that economic growth depends on more coal.

And beyond that, autocrats are often directly the result of fossil fuel. The crucial thing about oil and gas is that it is concentrated in a few spots around the world, and hence the people who live on top of or otherwise control those spots end up with huge amounts of unwarranted and unaccountable power.

Boris Johnson was just off in Saudi Arabia trying to round up some hydrocarbons – the day after the king beheaded 81 folks he didn’t like. Would anyone pay the slightest attention to the Saudi royal family if they did not possess oil? No. Nor would the Koch brothers have been able to dominate American politics on the basis of their ideas –when David Koch ran for the White House on the Libertarian ticket in 1980 he got almost no votes. So he and his brother Charles decided to use their winnings as America’s largest oil and gas barons to buy the GOP, and the rest is (dysfunctional) political history.

The most striking example of this phenomenon, it hardly need be said, is Vladimir Putin, a man whose power rests almost entirely on the production of stuff that you can burn. If I wandered through my house, it would be no problem to find electronics from China, textiles from India, all manner of goods from the EU – but there’s nothing anywhere that would say “made in Russia”. Sixty per cent of the export earnings that equipped his army came from oil and gas, and all the political clout that has cowed western Europe for decades came from his fingers on the gas spigot. He and his hideous war are the product of fossil fuel, and his fossil fuel interests have done much to corrupt the rest of the world.

Vladimir Putin and Alexei Miller, CEO of Russian natural gas giant Gazprom, attend a ceremony to mark the launch of the Sakhalin-Khabarovsk-Vladivostok natural gas pipeline in 2011. Photograph: Sasha Mordovets/Getty Images

It’s worth remembering that Donald Trump’s first secretary of state, Rex Tillerson, wears the Order of Friendship, personally pinned on his lapel by Putin in thanks for the vast investments Tillerson’s firm (that would be Exxon) had made in the Arctic – a region opened to their exploitation by the fact that it had, um, melted. And these guys stick together: it’s entirely unsurprising that when Coke, Pepsi, Starbucks and Amazon quit Russia last month, Koch Industries announced that it was staying put. The family business began, after all, by building refineries for Stalin.

Another way of saying this is that hydrocarbons by their nature tend towards the support of despotism – they’re highly dense in energy and hence very valuable; geography and geology means they can be controlled with relative ease. There’s one pipeline, one oil terminal.

Whereas sun and wind are, in these terms, much closer to democratic: they’re available everywhere, diffuse instead of concentrated. I can’t have an oilwell in my backyard because, as with almost all backyards, there is no oil there. Even if there was an oilwell, I would have to sell what I pumped to some refiner, and since I’m American, that would likely be a Koch enterprise. But I can (and do) have a solar panel on my roof; my wife and I rule our own tiny oligarchy, insulated from the market forces the Putins and the Kochs can unleash and exploit. The cost of energy delivered by the sun has not risen this year, and it will not rise next year.

As a general rule of thumb, those territories with the healthiest, least-captive-to-vested-interest democracies are making the most progress on climate change. Look around the world at Iceland or Costa Rica, around Europe at Finland or Spain, around the US at California or New York. So part of the job for climate campaigners is to work for functioning democratic states, where people’s demands for a working future will be prioritized over vested interest, ideology and personal fiefdoms.

But given the time constraints that physics impose – the need for rapid action everywhere – that can’t be the whole strategy. In fact, activists have arguably been a little too focused on politics as a source of change, and paid not quite enough attention to the other power center in our civilization: money.

If we could somehow persuade or force the world’s financial giants to change, that would yield quick progress as well. Maybe quicker, since speed is more a hallmark of stock exchanges than parliaments.

And here the news is a little better. Take my country as an example. Political power has come to rest in the reddest, most corrupt parts of America. The senators representing a relative handful of people in sparsely populated western states are able to tie up our political life, and those senators are almost all on the payroll of big oil. But money has collected in the blue parts of the country – Biden-voting counties account for 70% of the country’s economy.

That’s one reason some of us have worked so hard on campaigns like fossil fuel divestment – we won big victories with New York’s pension funds and with California’s vast university system, and so were able to put real pressure on big oil. Now we’re doing the same with the huge banks that are the industry’s financial lifeline. We’re well aware that we may never win over Montana or Mississippi, so we better have some solutions that don’t depend on doing so.

The same thing’s true globally. We may not be able to advocate in Beijing or Moscow or, increasingly, in Delhi. So, at least for these purposes, it’s useful that the biggest pots of money remain in Manhattan, in London, in Frankfurt, in Tokyo. These are places we still can make some noise.

And they are places where there’s some real chance of that noise being heard. Governments tend to favor people who’ve already made their fortune, industries that are already ascendant: that’s who comes with blocs of employees who vote, and that’s who can afford the bribes. But investors are all about who’s going to make money next. That’s why Tesla is worth far more than General Motors in the stock market, if not in the halls of Congress.

Moreover, if we can persuade the world of money to act, it’s capable of doing so quickly. Should, say, Chase Bank, currently the biggest lender on earth to fossil fuel, announce this year that it was quickly phasing out that support, the news would ripple out across stock markets in the matter of hours. That’s why some of us have felt it worthwhile to mount increasingly larger campaigns against these financial institutions, and to head off to jail from their lobbies.

The world of money is at least as unbalanced and unfair as the world of political power – but in ways that may make it a little easier for climate advocates to make progress.

Putin’s grotesque war might be where some of these strands come together. It highlights the ways that fossil fuel builds autocracy, and the power that control of scarce supplies gives to autocrats. It’s also shown us the power of financial systems to put pressure on the most recalcitrant political leaders: Russia is being systematically and effectively punished by bankers and corporations, though as my Ukrainian colleague Svitlana Romanko and I pointed out recently, they could be doing far more. The shock of the war may also be strengthening the resolve and unity of the world’s remaining democracies and perhaps – one can hope – diminishing the attraction of would-be despots like Donald Trump.

But we’ve got years, not decades, to get the climate crisis under some kind of control. We won’t get more moments like this. The brave people of Ukraine may be fighting for more than they can know.

  • This story is published as part of Covering Climate Now, a global collaboration of news outlets strengthening coverage of the climate story

Major Bank Ends New Investment in Arctic Drilling, Tar Sands/Oil Sands, and (Most) Coal Projects

Repost from The Globe and Mail

HSBC to stop funding most new fossil fuel developments

LONDON REUTERS, PUBLISHED APRIL 20, 2018
The HSBC bank logo is seen at their offices in the Canary Wharf financial district in London on March 3, 2016. | REINHARD KRAUSE/REUTERS

Europe’s largest bank, HSBC, said on Friday it would mostly stop funding new coal power plants, oil sands and arctic drilling, becoming the latest in a long line of investors to shun the fossil fuels.

Other large banks such as ING and BNP Paribas have made similar pledges in recent months as investors have mounted pressure to make sure bank’s actions align with the Paris agreement, a global pact to limit greenhouse gas emissions and curb rising temperatures.

“We recognise the need to reduce emissions rapidly to achieve the target set in the 2015 Paris Agreement … and our responsibility to support the communities in which we operate,” Daniel Klier, group head of strategy and global head of sustainable finance, said in a statement.

HSBC said it would make an exception for coal-fired power plants in Bangladesh, Indonesia and Vietnam.

“There’s a very significant number of people in those three countries who have no access to any electricity,” HSBC chief John Flint told HSBC shareholders at the bank’s annual general meeting in London on Friday.

“The reasonable position for us is to allow a short window for us to continue to get involved in financing coal there … if we think there is not a reasonable alternative,” he said.

Aside from the coal exemptions environmental campaigners Greenpeace welcomed the move and said HSBC’s new energy strategy would prevent it from providing project finance for TransCanada Corp.’s proposed $8-billion Keystone XL oil pipeline to Nebraska.

“This latest vote of no-confidence from a major financial institution shows that tar sands are becoming an increasingly toxic business proposition,” John Sauven, executive director of Greenpeace UK, said in a statement.

Would Saving A Livable Climate Destroy Buffett’s Fossil Fuel Empire?

Repost from Think Progress – Climate Progress

Would Saving A Livable Climate Destroy Buffett’s Fossil Fuel Empire?

By Joe Romm, March 11, 2016 8:00 AM
BNSF oil train derailment in 2013. CREDIT: BRUCE CRUMMY, AP

Billionaire Warren Buffett has bet the future of his company Berkshire Hathaway on dirty energy. In recent years he has been building a vertically-integrated fossil fuel empire — one that develops, delivers, processes, and burns the most climate-destroying fuels.

The final part of this series on Buffett looks at how BNSF Railways is the engine of his carbon-intensive conglomerate, creating a massive risk for shareholders in this increasingly carbon-constrained world — a risk the “Oracle of Omaha” needs to be far more upfront about.

Is Warren Buffett “The Profiteer” of “Climate Killers”?

When Rolling Stone named Warren Buffett one of its 17 “Climate Killers” in 2010, they called him “The Profiteer.” They zeroed in on his recent purchase of “Burlington Northern Santa Fe railroad for $26 billion — the largest acquisition of Buffett’s sto­ried career.”

Why? BNSF is “the nation’s top haul­er of coal, shipping some 300 million tons a year.” That is especially convenient for Buffett because, as noted in Part 2, Berkshire Hathaway Energy has four major utilities that still rely on coal for over half their electricity generation.

CoalValueImage
CREDIT: BNSF

But BNSF is so much more than just the top hauler of coal. As their website proudly attests “BNSF is the largest transporter of crude oil in North America” — and we all know how well the whole crude-by-rail thing has been going.

2015 “has already been the costliest by far for crude train explosions,” BloombergBusiness reported in December. A “BNSF train that derailed and exploded in Illinois” last March “carrying highly explosive crude from North Dakota” created some $5.5 million in damage.

From 2010 through mid-2014, oil shipped by rail in the United States increased from about one million barrels of oil every month to 25 million! At the same time, Canadian imports increased 50-fold, as we’ve reported. BNSF was a driving force behind that explosion.

oil-overtime
CREDIT: EIA DATA

Also, last October we learned about “what is believed to be the largest frac sand unit train to date in North America.” You guessed it: “The 150-car unit train, operated by BNSF, carried 16,500 tons of frac sand used in hydraulic fracturing.”

Warren Buffett Bets Big On The Tar Sands

But wait, there’s more. You may recall from Part 1 that last year, the billionaire spent $240 million buying another chunk of Canadian tar sands giant Suncor, upping his overall bet on the climate-destroying liquid fuel to $1.1 billion — a fact Buffett does not share with shareholders in his list of Berkshire Hathaway’s climate risks.

On top of that, as BNSF’s website also proudly attests, the railroad “is positioned to act as a gateway to the Canadian oil sands.” Seriously.

Indeed several years ago, a BNSF employee magazine explained how invested the railway was in all aspects of tar sands (aka bitumen) development. The key point is that “Before bitumen can move through a pipeline to its destination, it must be blended with diluents (diluting agents),” lighter weight hydrocarbons like natural gasoline or butane:

BNSF has been moving single carloads of diluents from U.S. refineries to the Canadian border…. The inbounds are then interchanged with Canadian railroads, then moved to Edmonton, with the final move to the oil sands’ processing center via pipeline.

Last year, BNSF moved about 9,000 carloads of diluents for the project, with the majority of loads originating from the Gulf Coast, California, and Kansas. This year, about 12,000 carloads are anticipated to move.

There’s more: Beyond shipping diluents, “BNSF has also transported turbines, other large machinery and pipes for use at the drilling sites.”

There’s still more to this empire. In 2015, Buffett “nearly doubled Berkshire’s position in Phillips 66,” one of the country’s leading oil (and gas) refiners and processors. The company has 15 refineries which can refine a total of 2.2 million barrels of crude per day.

In January of this year alone, Buffett spent a staggering $832 million to buy yet more Phillips 66 stock. At more than $5 billion, it is his sixth-largest holding. He now owns 14 percent of the “Number 7” company on the Fortune 500 list.

Phillips 66 is a major co-owner of the Wood River Refinery in Illinois, which in recent years made investments “to expand the capacity to handle the bitumen from the Alberta oil sands by nearly 700%.” Also not coincidentally, for the last year, Phillips 66 has been trying to get California planning commissioners to let it build a 1.3-mile rail spur to its Santa Maria refinery. Why? As the Sierra Club explained last month, “The oil giant seeks to transport tar sands crude from Canada in mile-long trains — each laden with over 2 million gallons of dirty crude.”

Both A Livable Climate And Buffett’s Empire Cannot Thrive

Yes, the Oracle of Omaha has a thing for the Canadian tar sands. But more than that, over the last several years he has built a vertically-integrated fossil fuel empire — one that develops, delivers, processes, and even burns the most carbon-intensive fossil fuels. It would be a brilliant strategy except for two small details.

First, climate science makes clear we have to leave most fossil fuels — and virtually all of the most carbon-intensive — in the ground to avoid global catastrophic warming. Second, over the past 18 months, the leading nations of the world unanimously agreed on a plan whose goal is to do just that, and the overwhelming majority of them made detailed pledges to slow or reverse carbon-intensive growth and replace it with carbon-free growth.

The domestic and international coal market has already collapsed as a result of growing environmental concerns and low-cost alternatives including renewables. If the world follows through on its plans to keep total warming below 2°C — a big “if,” for sure — then coal is going to continue to be squeezed out of the market in the coming decades and oil will almost certainly follow the same fate, peaking in demand by 2030, as I discussed last month.

Now whether or not you believe the world is going to achieve the plan it unanimously embraced in Paris in December, surely Buffett ought to at least mention to his shareholders the risks to Berkshire Hathaway if the world does. Yet, his latest annual letter to shareholders dismisses the risk of climate change.

Here is all Buffett says about the coal risk: “To begin with an obvious threat, BNSF, along with other railroads, is certain to lose significant coal volume over the next decade.” But he quickly dismisses this as a problem that is not “crucial to Berkshire’s long-term well-being.”

Last summer, BNSF executive chairman Matthew K. Rose noted the decline in U.S. coal transport and consumption. He said of his company’s major investment to upgrade its rail service to and from the coal-rich Powder River Basin, “That leaves us with millions of dollars in investment in what will eventually be stranded assets.”

Certainly, from a short-term business perspective, investing in oil-by-rail and tar-sands-by-rail to replace coal-by-rail appears to make sense. But what are the risks those investments will eventually become stranded assets, too? Low oil prices aren’t good for crude-by-rail, as BloombergBusiness explained in December. And aggressive climate action, which could well give us peak demand within 15 years, is not bullish for oil prices.

BNEFoilpeak1-16
CREDIT: BLOOMBERG

Rather than informing shareholders about any of these risks, Buffett asserts the reverse: “Both BHE [Berkshire Hathaway energy] and BNSF have been leaders in pursuing planet-friendly technology.” Seriously?

I discussed in Part 2 how, despite BHE’s own investments in renewables, BHE is working to crush solar energy in Nevada and around the western United States. And it remains a huge user of coal. And as we’ve seen BNSF is a major deliverer of coal….

But here is how Buffett defends the fairly ludicrous claim that BNSF is somehow one of the “leaders in pursuing planet-friendly technology”:

BNSF, like other Class I railroads, uses only a single gallon of diesel fuel to move a ton of freight almost 500 miles. That makes the railroads four times as fuel-efficient as trucks!

Yes, BNSF is a very fuel-efficient way of delivering vast amounts of climate-destroying fuels to market.

Finally, is it only a coincidence that after outperforming the market for decades, the stock of Berkshire Hathaway has actually underperformed the S&P 500 over the last five years?

Again, if serious global climate action ultimately keeps oil prices low and renders much of the tar sands uneconomic, then Buffett’s carefully constructed fossil fuel empire is going to keep suffering — and deservedly so. After all, leading climate activists have been urging major investors to disinvest in fossil fuels for years. Buffett is doing the exact reverse!

BOTTOM LINE: Between Berkshire Hathaway and a livable climate, only one can thrive. That’s not a tough choice, is it?