News of the Day:
From the Washington Examiner, Daily on Energy:
THE WAGE GAP BETWEEN GREEN AND FOSSIL FUEL JOBS: Workers in wind, solar, and other green industries earn significantly less than fossil fuel workers, challenging Biden’s effort to sell his infrastructure and climate plan as a creator of high-paying jobs of the future.
The medium hourly wage for solar industry workers is $24.48, and $25.95 for wind power employees, compared to $28.69 for the coal sector and $30.33 for natural gas, according to a report released this morning by the Energy Futures Initiative, run by former Obama administration Energy secretary Ernest Moniz.
Utility employees who run power plants receive a median hourly wage of $41.08, the highest in the energy sector, followed by workers in nuclear power, who require more training, at $39.19 per hour. But the nuclear industry accounts for less than 1% of total energy jobs.
Despite this disparity, wind and solar jobs are growing rapidly, increasing by 22% from 2015 to 2019. Petroleum and natural gas industry employment has grown by nearly 9% over that time, while coal sector jobs have fallen by 18%.
Energy industry jobs are quality ones: Energy workers as a whole earn more than the average American, with a median hourly wage of $25.60 compared to $19.14 nationally.
Energy industry employment was also more resilient during the pandemic compared to other industries. At the peak of job losses in April, the nation saw a roughly 20% decline in employment, while the energy industry lost 12% of its jobs. From June through December, the energy industry added back 324,000 jobs, though it remains 9% below peak employment at the end of 2019.
OIL:
Biden Is About To Give Heavy Oil Demand A Major Boost
Tsvetana Paraskova, OilPrice.Com, April 7, 2021
U.S. President Joe Biden would like to see his proposed $2-trillion package on infrastructure passed by the summer, White House Press Secretary Jen Psaki said on Tuesday, while analysts estimate that the package could raise demand for oil for building roads.
“He’d like to see progress by May and certainly a package through by the summer,” Psaki said, referring to President Biden’s plan on fixing the nation’s infrastructure unveiled last week.
The timeline Psaki mentioned is more ambitious than what some Democrats have hinted at—a deadline for action by September.
The package faces opposition from Republicans and even some Democrats who have called for a lower corporate tax rate than the 28-percent rate President Biden is proposing.
“We’re always open to hearing from members of Congress and — on their ideas and what they think should be a part of the package. At the end of the day, the President’s red line is inaction,” Press Secretary Psaki said on Tuesday.
The plan also proposes to “eliminate tax preferences for fossil fuels and make sure polluting industries pay for environmental cleanup.”
President Biden’s plan is expected to have an unforeseen but positive effect on oil demand because $621 billion of the total would be used for transportation infrastructure, including lots of roads—which are built with asphalt. The biggest winner from the recovery plan could be Canadian oil sands producers in what could be seen as an ironic twist of fate after President Biden canceled the Keystone XL pipeline that might have made life easier for these companies by providing a much-needed additional outlet for their growing oil exports to the southern neighbor.
Asphalt is made from bitumen, and bitumen is what the oil sands yield. With ambitious targets for new roads and bridges and large-scale repair works, asphalt demand in the next few years could soar.
GAS:
No people or wildlife impacted by Cook Inlet gas leak
Associated Press, April 7, 2021
The cause of a natural gas leak from a line that provides fuel for two Hilcorp Alaska offshore production platforms in Cook Inlet is being investigated, the Alaska Department of Environmental Conservation said.
The department released an initial update on the leak Monday, four days after it says a helicopter pilot spotted bubbles on the water’s surface. The leak was reported to authorities, including the department, by Hilcorp about an hour later that same day, April 1, the report states.
Hilcorp shut down the platforms in response, the report stated. The company said the leak was stopped on Saturday by activating block valves.
The department released an initial update on the leak Monday, four days after it says a helicopter pilot spotted bubbles on the water’s surface. The leak was reported to authorities, including the department, by Hilcorp about an hour later that same day, April 1, the report states.
Hilcorp shut down the platforms in response, the report stated. The company said the leak was stopped on Saturday by activating block valves.
Hilcorp spokesperson Luke Miller in a statement Tuesday said the company is monitoring ice conditions and that sonar scans were planned to gather data.
“Divers will be deployed mid-week to install a temporary clamp,” he said.
Miller said no personnel or wildlife “have been impacted.”
The environmental conservation department in its Monday report said the size of the leak was unknown.
Anna Carey, an environmental program specialist with the department, said by email Tuesday that Hilcorp will work with the federal Pipeline and Hazardous Materials Safety Administration to investigate the cause.
Carey said the line is regulated by the federal pipeline agency and that the state Department of Environmental Conservation won’t play a role in the investigative process.
The Anchorage Daily News reported that a leak also occurred from the same pipe in 2017. In that case, the leak lasted for months and led to requirements for closer inspections by Hilcorp to prevent future leaks.
The line, installed in Cook Inlet in the 1960s, originally carried crude oil before it was converted to ship natural gas as fuel. It extends about 7 miles (11 kilometers) from the coast to reach the platforms, the newspaper reported.
Hilcorp cited abrasion from an underwater boulder for the 2017 leak. Rock abrasion and strong inlet tides caused leaks on another section of the line in 2014, before XTO Energy sold it to Hilcorp.
The 2017 leak was sealed by a temporary clamp. But Carey told the newspaper that leak went on longer partly because Hilcorp was concerned that minimal power was needed for the platforms, a concern they overcame this time.
Hilcorp also worried then about depressurizing the gas line too much and possibly allowing residual oil to escape from the line, Carey said.
In the current case, Hilcorp worked with the federal pipeline agency to depressurize the line before the leak was stopped, Carey said.
Hilcorp is the leading oil and gas producer in Cook Inlet.
MINING:
China’s Rare-Earths Quest Upends Greenland’s Government
Drew Hinshaw, Stacy Meichtry, The Wall Street Journal, April 7, 2021
China’s global quest for rare-earth supplies has delivered upheaval in the electoral landscape of an icebound island 5,000 miles away.
Greenland’s Inuit Ataqatigiit, a left-wing and environmentalist party, garnered 37% of the vote in a snap election this week that was called amid mounting controversy over plans to develop an unprecedented rare-earths mine along the island’s southern edge. The incumbent center-left party Siumut, meaning Forward, only garnered 29% of the vote after backing the mining project. Mute Egede, the 34-year-old leader of IA, which opposed the project, will now try to form a coalition government.
The election is a blow to a massive project that Beijing was eyeing as part of its efforts to increase its grip on the world’s rare earths—the raw materials necessary to make the batteries and magnets that power everything from cellphones and electric cars to wind turbines. Global demand for rare earths is forecast to soar as countries push to meet their commitments under the Paris Climate Accord, which President Biden has decided to rejoin.
China mines over 70% of the world’s rare earths and is responsible for 90% of the complex process to turn them into magnets, according to Adamas Intelligence, which provides research on minerals and metals. The mining project in Kvanefjeld, a mountainous area along Greenland’s jagged southern coast, was expected to produce 10% of the world’s rare earths, according to Greenland Minerals Ltd. , an Australia-based firm that holds the project’s exploratory license.
In 2016, China’s Shenghe Resources Holding Co., one of the world’s biggest producers of rare earths materials, acquired a 12.5% stake in Greenland Minerals, making it the company’s largest shareholder. Since then, Shenghe’s stake has been diluted to 9%, but Greenland Minerals is relying on the Chinese firm to process any materials it extracts from Greenland, a technically challenging step that is key to the project’s viability.
Aaja Chemnitz Larsen, a member of the Inuit Ataqatigiit, said the election gave her party a strong mandate to oppose the mine. The concession includes uranium deposits, which locals fear could be released into the area’s pristine natural landscape and farms. The project is also forecast to increase Greenland’s C02 emissions by 45%.
“It would be devastating for Greenland,” Ms. Larsen said
Miles Guy, chief financial officer of Greenland Minerals, said the firm was on the cusp of receiving approval from Greenland’s previous government to proceed with the mine when controversy around the project triggered the snap election. The firm has already invested 130 million Australian dollars, equivalent to $99.6 million, in the project.
“In our view it would be an extreme display of bad faith to suddenly reverse all that,” Mr. Guy said.
POLITICS:
Stedman: $3,000 dividend ‘extremely unlikely’ as legislators struggle to balance budget
Robert Woolsey, KCAW, April 2, 2021
Sitka Sen. Bert Stedman is determined not to spend down Alaska’s Permanent Fund to balance the state’s budget, even if it means residents won’t be seeing a $3,000 dividend this fall.
Stedman delivered a legislative update to the Sitka Chamber of Commerce on Wednesday (3-31-21) and outlined some of the challenges as legislators balance the realities of a dwindling state savings account against the temporary influx of over $1 billion in federal relief money.
Stedman is a Republican and a conservative, and he has watched in dismay as state government — largely controlled by his party — has failed to address Alaska’s systemic financial problems.
“We all understand we’ve been running at deficit spending for quite some time,” he said, “and we’ve spent down our savings accounts precipitously — well over $10 billion — and we’ve got about a billion left in our main savings account.”
That savings account is the Constitutional Budget Reserve, or the CBR.
Stedman co-chairs the Senate Finance Committee and oversees the state operations budget. Last December, Gov. Mike Dunleavy, also a Republican, unveiled a budget proposal for the state that would draw the usual 5-percent from the Permanent Fund to pay the state’s bills, plus another $3 billion to pay out his promised $3,000 dividend.
The only problem: The governor’s not in charge of the budget; legislators like Stedman are. Or in Stedman’s words, “he proposes, and we dispose.”
Stedman says a $3,000 dividend is “extremely unlikely,” because it would put Alaska on a slippery slope toward spending the Permanent Fund itself.
“We would still have a substantial budget deficit and we’d be eroding the Permanent Fund,” Stedman said, “and some of us are very concerned that if we erode the Permanent Fund Earnings Reserve — which is the spendable portion of the Permanent Fund — we have nowhere else to go.”
Stedman said that although there’s been discussion about tax structure this session — both oil taxes and sales taxes — nothing is likely to move through the legislature this year. Like legislative bodies everywhere in the country, Stedman says he and his colleagues are focused on the influx of cash from the “American Rescue Plan,” the $1.9 trillion relief bill which President Biden signed into law earlier in March. That amounts to over $1 billion for Alaska, including $359 million for the state’s schools.
Stedman says there’s some flexibility in appropriating this money, and it’s occupying a lot of the legislature’s attention.
“We’re looking at breaking it up over 2 or 3 years, so we don’t waste it,” said Stedman.
Unlike earlier relief bills, the American Rescue Plan has a longer horizon, with a spending deadline at the end of 2024.
Where that money will land has yet to be determined. Stedman thinks there will be some for the Alaska Marine Highway, and that there might be a way to fold relief funding into SEARHC’s new hospital project in Sitka, which could require substantial infrastructure upgrades to accomplish. And he also wants to look at expanding classrooms at Mt. Edgecumbe High School, replacing the World War II vintage dorms, and funding an endowment for the school.
Stedman sees these projects as a way to balance the “expensive roads and bridges” that are needed in other regions of the state.
But some other things were going to be a tougher sell: namely, relief for the visitor industry. Southeast and the Denali Borough are the two hardest-hit areas by the two-year hiatus in cruising. Stedman didn’t go out of his way to raise hopes for relief here, but he would try. “Now that’s part of the solution,” he said, “to get your colleagues to recognize you’ve got an impact, it’s another challenge to get them to support cutting funds loose to the impacted areas.”
CLIMATE CHANGE:
Climate change can’t be solved in court
Tom Stebbins, New York Daily News, April 7, 2021
Mayor de Blasio and the contingency fee attorneys who wooed his administration just lost their lawsuit against the five major fossil fuel companies — again. The U.S. Court of Appeals for the Second Circuit last week affirmed a Manhattan judge’s 2018 decision to toss New York City’s claims against BP, Chevron, ExxonMobil, ConocoPhillips, and Royal Dutch Shell.
That decision represents a monumental defeat for the plaintiffs’ lawyers and elected officials who have colluded over the past decade to regulate the international energy industry through local lawsuits. And it may have vital repercussions for similar lawsuits, including those before the U.S. Supreme Court right now.
In announcing the lawsuit back in 2018, Mayor de Blasio full-throatedly proclaimed his authority — and by extension the authority of the private law firm his office hired — to use local litigation to engage in global climate-related policymaking:
“We never make the mistake of waiting on our national government to act when it’s unwilling to. This city is acting.”
Not so fast, said the Second Circuit. Allowing a lawsuit like the city’s to proceed “would not only risk jeopardizing our nation’s foreign policy goals but would also seem to circumvent Congress’ own expectations.”
The decision could have far-reaching consequences for two dozen cases filed around the country on similar grounds as New York’s. One of them is awaiting action by the Supreme Court.
In Baltimore vs. BP, et al., the high court heard arguments related to whether the lawsuits can be litigated in state or federal courts. And the defendants in the lawsuits by Oakland and San Francisco are directly asking the court to weigh in on state versus federal jurisdiction in their cases.
If the Supreme Court justices think at all like the panel of judges at the Second Circuit, the answer will be clear: State courts should not decide issues inherently national and international in scope. Those cases “call for the application of federal common law, not state law,” according to the Second Circuit, and should be heard in federal court.
Climate change is a global phenomenon and the activity alleged to cause it — the legal sale of a product required by all sectors, including the municipalities filing suits, to function in a modern society — occurred all over the world, not just within the borders of New York State. As the Second Circuit wrote in affirming dismissal of de Blasio’s lawsuit “the city intends to hold the producers liable, under New York law, for the effects of emissions made around the globe over the past several hundred years” but “such a sprawling case is simply beyond the limits of state law.”