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Big Oil Talks the Talk Then Pulls an End-Run on Carbon Pricing

[fa icon="calendar'] Mar 13, 2015 10:44:04 AM / by Carol Pierson Holding

By: Carol Pierson-Holding

Carpool lane

The Seattle Times ran an article whose headline was so unsurprising I almost didn’t read on: “Oil industry not buying Gov. Jay Inslee’s cap-and-trade plan.” No surprise right?

Big Oil’s actions tell us it not only wants to kill carbon pricing but still actively promotes climate-denial, a fact most recently reinforced by the cash-for-climate-denial scandal of Harvard-Smithsonian physicist Wei-Hock Soon, whose papers are the go-to reference for impugning climate change. Big Oil withdrew from direct supporting Soon and now funnels “donations” through Donors Trust charity, which in turn donates to climate denial organizations.

And hadn’t I just been sent a link to Biggreenradicals.com, a site funded by the DC-based Environmental Policy Alliance (which goes by the ultra-cynical acronym “EPA”)? Its stated function is to “educate the public about the real agenda of well-funded environmental activist groups” and its investigations point to the Kremlin as a major funder of the US EPA.

Russia funds the EPA to destabilize the U.S.? Really? Still, whatever “EPA” is spending on its whacky research is a pittance compared to $213 million the fossil fuel industry spent last year on lobbying and the $900 million a year given to organizational supporters of climate denial.

That Seattle Times headline seemed to be restating the obvious, that oil companies will always oppose carbon pricing. But the text of the article presents a totally different picture: “…(chief executive of Royal Dutch Shell) Ben van Beurden warned that the industry faces a credibility problem ‘if you undermine calls for an effective carbon price; and if you always descend into the ‘jobs versus environment’ argument in the public debate’.”

Shell is not the only oil giant to endorse carbon pricing — BP also says it favors a global carbon price, and that national or regional carbon policies are “a good first step.” The industry knows its coming. 73 countries including China and Russia have or are creating a form of carbon pricing, either carbon tax or cap and trade. A successful cap and trade system has been operating since 2008 across nine states in the northeastern U.S.

But here in Washington State, where the legislature is currently debating cap and trade legislation, the oil industry is opposing carbon pricing with everything its got.

It’s a brilliant play:

Big Oil CEOs say they support carbon pricing.

Washington’s governor proposes legislation would set a price on carbon emissions.

Big Oil refuses to negotiate.

The oil and gas sector has spent $415,000 in donations directly to legislative candidates. Couldn’t they have stalemated without the expensive price tag?

Sure, but they’ve got something else up their sleeve:

Last week, the GOP-controlled Senate passed a new $15-billion transportation plan that includes increases in the gas tax (nearly 12 cents phased in over three years) to pay for road infrastructure.

…But the Senate bill also contains a so-called ‘poison pill’ that cuts transit funding if the governor imposes stricter emission standards on fuels, vehicles or fuel distributors, or limits carbon emissions. That would be true for the life of the plan, or about 16 years.

How diabolically clever. Going flat out against any limit on emissions, much less cap and trade, would backfire in a pro-environment state like Washington, where 71% of the population supports the measure. With its Republican friends in the Senate, Big Oil devised a run-around that improves the odds that cap and trade will not become law and holds public transit ransom if anyone objects.

Improving Washington State’s roads could alleviate the terrible traffic jams in Western Washington’s cities. But they’d also make Washington State’s major polluters, private passenger cars, more attractive, and thereby assure that the switch from fossil fuels to renewables is extended. Carbon pricing seems inevitable, even to Big Oil, yet they’re using every trick to delay it, spending a bundle in this relatively tiny market to do so.

Thankfully, we’ve got a governor willing to throw his political clout behind it, and the support of environmentalists, labor unions, health organizations, low-income groups and native tribes. And shouldn’t that be enough?

Photo courtesy of Keith Tyler via Flickr CC


Carol Pierson HoldingCarol Pierson Holding writes on environmental issues and social responsibility for policy and news publications, including the Carnegie Council’s Policy Innovations, Harvard Business Review, San Francisco Chronicle, India Time, The Huffington Post and many other web sites. Her articles on corporate social responsibility can be found on CSRHub.com, a website that provides sustainability ratings data on 10,000+ companies worldwide. Carol holds degrees from Smith College and Harvard University.

CSRHub provides access to corporate social responsibility and sustainability ratings and information on 13,736+ companies from 135 industries in 127 countries. Managers, researchers and activists use CSRHub to benchmark company performance, learn how stakeholders evaluate company CSR practices and seek ways to change the world.

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[fa icon="comment"] 0 Comments posted in Ben van Beurden, Carbon pricing, emissions, Shell, Uncategorized, Wei-Hock Soon, BP, cap and fade, Carol Pierson Holding, environmental, Washington state

Lawmakers Overturn an Ill-intentioned Solar Project

[fa icon="calendar'] Jun 7, 2011 11:21:06 AM / by Carol Pierson Holding

By Carol Pierson Holding

5170389892_56a508e7fb Solar energy is such a great idea in concept. It's not surprising that when a New York City businessman planned the world’s largest solar array in Washington state, it gained popular support as well as federal backing. It seemed that the U.S. would finally lead the way in alternative energy by example. That’s why it hurt so much when it turned out the project was more about making money than producing viable, solar energy at scale.

This story is about how legislative wrangling stopped it from going forward. 

For those who missed the original story: New York City timber baron John M. Rudy owns 46,000 acres of land at the base of the Cascade Mountains. Since Rudy’s timber has been made worthless by the closing of local lumber processing plants, his company, American Forestry, decided to develop the land, starting with the Teanaway Solar Reserve, cutting down 900 acres of trees to do so.

Even if you didn’t have to cut down all those trees, a quick look at a few solar maps makes it clear that Teanaway is not where you would choose to locate an economically viable solar farm. Plus Teanaway gets over twice the amount of rain of neighboring Ellensburg, where an earlier solar experiment was so disappointing that it won’t be expanding.

So how did TSR make the numbers work? The Federal Stimulus Bill covered 1/3 of construction costs and state subsidies in the form of credits to utilities for buying from renewable energy sources.

And still the numbers didn’t work. So TSR petitioned the Washington State legislature for double the original state subsidy, believing that no legislator in his or her right mind would vote against solar energy in this environmentally crazy place. An influential lobbying firm, Strategies 360, exerted even more pressure, touting environmental leadership for Washington State and jobs too. Soon nearly every state politician was a strong supporter. The State House voted 91 to 3 in favor of the bill.

The bill then went to the State Senate, whose members couldn’t say no to the “largest solar farm in the world”, especially after Governor Christine Gregoire announced her vision for Washington to be the national leader in the creation of green energy.

So the Senate, understanding the flaws in the project, added two amendments to essentially kill the bill. Playing TSR’s own trump card, the promise of more jobs, the Senate’s first amendment required that TSR manufacture its solar panels in Kittitas County, where Teanaway is located. The second amendment demanded that all TSR power go to Washington residents, depriving TSR of a far more attractive market: California. Why is California more attractive? Because in Washington State there is an over supply of energy.

That’s right, an over supply. The state’s abundant hydropower gives Washington over 90% of the energy it needs. Since hydropower is the cheapest form of renewable, the alternative energy market is tough to crack. On the other side of the equation, power demand in Washington has held steady despite population gains because residents feel strongly about energy conservation.

The culture in the Pacific Northwest tends to favor the environment -- even over power. What the East Coast robber barons did not take into account when planning their solar coup was the overwhelming natural beauty of Teanaway -- even where the forests have been logged. Perhaps members of the State Senate knew the area or have friends there who extolled its magnificence or could envision what it was like from topographical maps that show lakes and rivers and ridges. We may never know exactly what happened with the TRS project, only that, as with climate change, nature has lot of interesting ways to exert its influence.


Carol Pierson Holding is a writer and an environmentalist; her articles on CSR can be found on her website.

Inset photo courtesy of International Rivers.

 

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[fa icon="comment"] 1 Comment posted in corporate social responsibility, CSR, sustainability ratings, Teanaway, Teanaway Solar Reserve, Uncategorized, solar energy, sustainability, Carol Pierson Holding, CSRHub, solar panels, Washington state

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