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Oil Change International: Single Subsidy to Tar Sands Costs Taxpayers $610 Million per Year

Posted By Lowell F. on October 16th, 2014

Oil Change International (OCI) has been doing superb work in recent months, detailing the damage done by taxpayer-funded subsidies to the fossil fuel industry. For instance, in Subsidy Spotlight: Paid to Pollute and Poison, OCI reports that “federal and state subsidies to the oil, gas, and coal industries result in a $21 billion windfall for carbon polluting companies every year,” and that “risky drilling projects like those undertaken by BP would most likely never occur without this type of corporate welfare.”

Another OCI report focuses on subsidized fracking, and how “this experiment of exposing people to toxics released by natural gas development would not occur without billions in subsidies from the federal and state governments.” Also see OCI’s “Cashing In On Carbon: How Taxpayer Dollars Greenwash Dirty Energy,” which argues that “[t]hrough grants, tax breaks, and loan guarantees, the public is paying the financial costs––while shouldering the consequences––of re-shaping the carbon cycle to justify the continued use of dirty fuels and dangerous methods under the auspices of mitigating climate change.” In short, taxpayer subsidies to the fossil fuel industry are harming the environment and people’s health, for absolutely no good reason whatsoever.

Now, OCI is out with yet another example of the tremendous cost of fossil fuel subsidies and the damage they do, with the article “Subsidy Spotlight: Paying the Price of Tar Sands Expansion.” The focus of this piece is the subsidies supporting upgrades to refineries, which allow them to more easily (and profitably) process tar sands, and also the adverse health impact that dirty tar sands byproducts like petroleum coke (“petcoke”) have on communities. Here’s a short excerpt, but we most definitely recommend that you read the entire article, as this is a terrific piece of journalism.

In December 2013, after six years of community pushback, court battles, Environmental Protection Agency citations, and ongoing construction in spite of it all, BP’s $4.2 billion retrofitted facility came fully online.

It was now a tar sands refinery, capable of refining 350,000 barrels of the world’s dirtiest oil per day. And it was paid for, in large part, by U.S. taxpayers.

A little-known tax break allows companies to write-off half of the cost of new equipment for refining tar sands and shale oil. According to a report by Oil Change International, this subsidy had a potential value to oil companies (and cost to taxpayers) of $610 million in 2013.

Tar sands are petroleum deposits made up of bitumen mixed in with sand, water and clay. Their production is extremely destructive at every stage: from strip mining indigenous lands in Canada, to disastrous accidents along transportation routes, to dangerous emission levels produced by refining the heavy crude, to the hazards imposed on communities saddled with tar sands byproducts like petroleum coke (“petcoke”), and finally to the greenhouse gases pumped into the atmosphere when the end product is used for fuel.

Despite all the reasons to keep tar sands in the ground, the refining equipment tax credit has helped put tar sands development in the U.S. on the rise, accelerating climate change at the expense––in every sense of the word––of American taxpayers.

Last but not least, if you’re interested in helping “put an end to fossil fuel subsidies and extreme energy extraction,” please click here.

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Five Energy Stories Worth Reading Today (10/16/14)

Posted By Lowell F. on October 16th, 2014

Here are five recommended reads for today (10/16/14).

  1. Climate Progress reports: Renewable energy will make up almost half of sub-Saharan Africa’s power generation growth by 2040, according to a report by the International Energy Agency. The report, which is the IEA’s first major analysis of sub-Saharan Africa, looked at the region’s potential to supply energy to the approximately 620 million people who still lack access to electricity.
  2. According to EcoWatch, “The argument that fracking can help to reduce greenhouse gas emissions is misguided, according to an international scientific study, because the amount of extra fossil fuel it will produce will cancel out the benefits of its lower pollution content.”
  3. Greentech Media reports: “After a second round of bidding from developers seeking to build hundreds of megawatts’ worth of solar plants in the state, Georgia Power reported that the average price of electricity came in at 6.5 cents per kilowatt-hour. That’s 2 cents cheaper than last year’s bids.”
  4. The Sydney Morning Herald writes, “Global coal industry still in denial over prices, regulation.”
  5. The New York Times reports, “The movement to end investments in fossil fuel companies began with universities, but religious institutions are joining as well.”
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Five Energy Stories Worth Reading Today (10/15/14)

Posted By Lowell F. on October 15th, 2014

Here are five recommended reads for today (10/15/14).

  1. Tina Casey reports at Clean Technica, “US Military Goes All In On Climate Change Adaptation.”
  2. According to DeSmogBlog: ”The European Union’s 2020 climate and energy package, which is binding legislation, calls for emissions to be cut by 20 per cent from 1990 levels by 2020. In addition, the plan calls for energy efficiency savings of 20 per cent and a 20 per cent increase in renewable energy technologies.”
  3. Greentech Media reports: “A total of 130 thousand metric tons (kilometric tons or KMT) of polysilicon manufacturing capacity, equivalent to roughly 25 gigawatts of crystalline silicon (c-Si) solar PV panels, is estimated to come on-line in 2015 and 2016, according to GTM Research’s newest report, Polysilicon 2015-2018: Supply, Demand, Cost and Pricing. By 2016, cumulative global polysilicon supply capability will reach 437 KMT, enough to enable 85 gigawatts’ worth of c-Si panel production.”
  4. According to Climate Progress, “An analysis released today found that the EPA could go much further when it comes to the plan’s renewable energy targets, and that states can cost-effectively produce nearly twice as much renewable electricity as the EPA calculated.”
  5. Treehugger reports, “[Bank of England Governor] Mark Carney…told a World Bank seminar that ‘the vast majority of reserves (of oil, coal and gas) are unburnable,’ before urging investors to consider the long-term implications of the investments they make.”
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Is ExxonMobil Starting to Take the Fossil Fuel Divestment Movement Seriously?

Posted By Lowell F. on October 14th, 2014

Is ExxonMobil starting to worry about the fossil fuel divestment movement?  Based on this article, it certainly looks that way.

Exxon Mobil is wielding its public relations might against the fossil-fuel divestment movement, signaling that climate-change activists have struck a nerve at the world’s biggest publicly traded oil and gas company.

Exxon Mobil’s blog, titled “Perspectives,” posted a lengthy attack Friday about the divestment movement, which urges universities, churches, pension funds, and other big institutional investors to dump their shares of oil and coal companies as part of the fight against global warming.

But the blog post calls the movement “out of step with reality,” saying it’s at odds with the need for poor nations to gain better access to energy, as well as the need for fossil fuels to meet global energy demand for decades to come.

So far, the climate advocates’ progress at getting a growing number of institutions to shed holdings in fossil fuel companies remains pretty small compared with the scale of the industry they’re battling.

But, the article adds, while the fossil fuel divestment movement may be small now, it’s growing fast. As a result, the fossil fuel divestment movement clearly has ExxonMobil nervous, and there’s one clear piece of evidence to prove that’s the case: ExxonMobil’s attacking it. Because, let’s face it, that’s what the fossil fuel industry does when it sees a threat – relentlessly attacks, just as it’s done with clean energy and climate science in recent years. The problem for the fossil fuel industry, though, is that no matter how much money they spend attacking their demons, the reality – plummeting costs and rapidly improving technology for solar and wind, mountains of scientific evidence on climate change driven by fossil fuel combustion – isn’t going away.

All of which means the harsh reality for ExxonMobil and other fossil fuel companies is that, while they certainly are big and powerful today, that situation could change in a hurry. And if the fossil fuel folks don’t believe that, all they have to do is look at the land line telephone companies of the 1970s in the era of cell phones and Skype, or the traditional journalism business model in the internet age, then figure out if that could be them.  While they’re pondering this question, they might also consider whether in 10-20 years, will they be: a) kicking themselves for fighting the inexorable shift towards clean energy; or b) patting themselves on the back for joining it? At least at the moment, it looks like they’re foolishly, stubbornly sticking with option “a”.

Posted in Fossil Fuels, Oil
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Five Energy Stories Worth Reading Today (10/14/14)

Posted By Lowell F. on October 14th, 2014

Here are five recommended reads for today (10/14/14).

  1. Bloomberg reports, “At a windy mountain pass on the edge of the Mojave DesertNorth America’s most potent collection of batteries used for storing unused power is humming its way toward an electricity revolution.”
  2. According to The Guardian, “Onshore wind is cheaper than coal, gas or nuclear energy when the costs of ‘external’ factors like air quality, human toxicity and climate change are taken into account, according to an EU analysis.”
  3. The New York Times reports: “The Pentagon on Monday released a report asserting decisively that climate change poses an immediate threat to national security, with increased risks from terrorism, infectious disease, global poverty and food shortages. It also predicted rising demand for military disaster responses as extreme weather creates more global humanitarian crises.”
  4. The Guardian describes how, “over the last few years the coal industry has been trying to hijack the issue of energy poverty by telling the world that the only way the poorest nations can pull themselves out of poverty is by purchasing lots of their product.” The article notes that this is a “deeply cynical campaign to get more coal burned at a time when world leaders need to be working out how to do the opposite to avoid the worst impacts of climate change.”
  5. CBS News writes: “Does having your own solar power installation sound appealing? It apparently does to a growing number of American businesses and homeowners who are investing in what many tout as a cleaner and less expensive source of electricity. And that trend of buying into solar power is also growing internationally.”
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