Posted June 26, 2015
API Downstream Group Director Bob Greco traveled this week to EPA’s field hearing on the Renewable Fuel Standard (RFS) in Kansas City, to detail concerns over the flawed program, with its market-distorting mandates for ever-increasing use of ethanol in the national fuel supply. His remarks, as prepared for delivery:
The Ethanol Blend Wall
Our members’ primary RFS concern is the ethanol blend wall. Serious vehicle and retail infrastructure compatibility issues exist with gasoline containing more than 10 percent ethanol. We are encouraged that EPA has proposed to address this reality.
Gasoline demand increases projected in 2007 did not materialize, and Congress granted EPA the authority to balance its aspirational goals with reality. API supports EPA’s use of its explicit RFS waiver authorities in 2014, ‘15, ‘16, and beyond to avoid negative impacts on America’s fuel supply and to prevent harm to American consumers.
Posted June 23, 2015
We spend a good deal of time trying to highlight the enormous potential of American energy – in terms of jobs, growth to our economy, greater energy security and more. It’s a big deal. The ongoing U.S. energy revolution is a game-changer – built on safe, responsible domestic oil and natural gas development.
Yet, there’s a caveat: Energy development hinges on energy policy. And as the 2016 election cycle nears, it’s difficult to overstate the importance of choosing policymakers who: (a) recognize the generational opportunities being afforded by American energy, and (b) understand the need for policy paths and regulatory approaches that will sustain and grow our country’s energy renaissance.
The major findings in a new Wood Mackenzie study show in clear terms the stakes for all Americans in choosing the right leadership for the country’s energy future. Wood Mackenzie analyzed and compared the impacts in seven major areas of a future characterized by pro-development policies and also one characterized by regulatory constraints.
Posted June 23, 2015
Fuelfix.com – President Barack Obama “understands” the argument for exporting U.S. crude, a leading Democratic advocate said Monday.
“He understands,” Sen. Heidi Heitkamp, D-N.D., said on CNBC’s “Squawk Box.” “He is in that category of understanding. I think his State Department understands how significant this could be to soft power. I think his Energy Department understands that this is bad economics and bad for the resource.”
Heitkamp stressed that she couldn’t speak for the administration, but added that “at the highest level, they understand this policy is not a good policy.”
Still, when it comes to the politically treacherous subject of widely exporting U.S. oil — which has been under heavy restrictions since the 1970s — “everybody wants to get together and . . . make a bipartisan decision to do this,” Heitkamp added.
Posted June 17, 2015
Quick rewind to 2007, when Congress enacted the Renewable Fuel Standard (RFS): The U.S. faced energy challenges – declining domestic production leading to greater dependence on imports and ever-increasing consumer costs. The RFS was conceived as a way to spur production of advanced biofuels that would help on imports and costs.
Today the energy landscape has completely changed. Thanks to surging domestic production from shale and other tight-rock formations with advanced hydraulic fracturing and horizontal drilling, the United States is No. 1 in the world in the production of petroleum and natural gas hydrocarbons. Our imports are falling, and consumers have enjoyed lower prices at the pump.
Yet, the RFS remains – with its mandates for increasing use of ethanol in the fuel supply, seemingly impervious to the changed energy landscape, even as increased domestic oil production has checked off RFS objectives one by one. Even EPA’s latest proposal for ethanol use, while acknowledging that the RFS has serious flaws, continues to try to manage the behavior of markets and consumers, ironically leaving both on the sidelines.
That was the message in a telephone briefing with reporters hosted by API President and CEO Jack Gerard. Joining the call were Wayne Allard of the American Motorcyclist Association (AMA), Heather White of the Environmental Working Group (EWG) and Rob Green of the National Council of Chain Restaurants (NCCR).
Posted June 17, 2015
The Hill – A new Republican bill introduced Tuesday would completely repeal the federal mandate to blend ethanol into the nation’s gasoline supply.
Sen. Bill Cassidy’s (R-La.) legislation would completely do away with the renewable fuel standard, which first took effect in 2005 and now requires increasing levels of ethanol and biodiesel to be put into traditional fossil fuels.
The mandate invites frequent criticism from Republicans, the oil industry and sectors that complain the demand it creates for corn ethanol increases agricultural prices.
“Workers, refiners, producers, farmers and ranchers across the country are affected by the renewable fuel standard,” Cassidy said in a statement. “More mandates mean less jobs. It means families are paying more for gas and groceries.”
Posted June 16, 2015
Platts – Stabilizing crude oil prices and falling drilling costs could soon boost US production by hundreds of thousands of barrels per day, an upstream oil and gas economist with the US Energy Information Administration, said Monday.
"We're starting to see a turn in production," Grant Nulle said during a panel discussion at EIA's annual conference. "Conditions are conducive for this to happen."
While recent EIA data has shown production declines at existing wells have outpaced production from new wells, a rebound is likely as operators focus on the most efficient wells and look to increase well completions amid falling costs and continued availability of capital, Nulle said.
In a recent survey of 85,000 wells drilled between 2012 and 2014, initial production rates have roughly doubled, he said.
Posted June 12, 2015
For some time we’ve been talking about EPA’s bid to make the nation’s ozone standards more restrictive.
We’ve expressed puzzlement that the agency wants to impose more stringent standards when the existing ones are working – lowering ozone levels 18 percent between 2000 and 2013 according to EPA’s own data. We’ve noted the lack of scientific and public health justification for stricter standards while highlighting potential risks to the economy. If this week’s House Energy and Commerce subcommittee hearing on ozone was any measure, the issue has the attention of many in Congress.
Top EPA official Janet McCabe was peppered with questions about economic impacts, the arguable wisdom of stricter standards when areas like Los Angeles don’t meet existing standards and EPA’s push for more stringent standards before the current standards are fully implemented in the states.
Posted June 11, 2015
Nowhere in the United States is there more to learn from EPA’s recent water/fracking study than in the state of New York.
Six months ago Gov. Andrew Cuomo banned hydraulic fracturing as too hazardous. Though the Cuomo administration conducted no original research of its own, the governor said no to fracking, no to jobs and economic growth – especially in the state’s struggling Southern Tier. He all but extinguished the hopes of many upstaters for a home-grown economic miracle – like the one occurring next door in Pennsylvania, thanks to fracking – one that would help save family farms, let children and grandchildren live and prosper where they were raised and help ensure economic security for thousands.
Yet, EPA’s five-year, multi-million-dollar study says the governor’s concerns are basically baseless, that safe hydraulic fracturing doesn’t threaten the nation’s drinking water.
Posted June 5, 2015
New York Post – Six months after Gov. Andrew Cuomo banned fracking as too hazardous, the federal government released a report Thursday saying there’s no evidence the drilling practice has caused widespread harm to drinking water in the United States.
“Based on available scientific information, we found out that hydraulic fracturing activities in United States are carried out in a way that has not had widespread systemic impact on drinking-water resources,” said Thomas Burke, deputy assistant administrator of the Environmental Protection Agency.
“It is a new lens, so we can all make better decisions about public health.”
The report, issued in draft form after three years of study, cautioned that safeguards are still needed because some drinking water has been contaminated.
“The number of documented impacts on groundwater resources is relatively low,” Burke said.
Posted June 4, 2015
After five years and millions of taxpayer dollars, EPA says what we in industry and others have said for some time: Safe hydraulic fracturing doesn’t threaten our drinking water. The salient quote from EPA’s draft report about fracking and associated operational components:
“We did not find evidence that these mechanisms have led to widespread, systemic impacts on drinking water resources in the United States.”
EPA’s findings discredit scaremongering used by fracking opponents and should help focus attention where industry is and has been focused – on continuous improvements in operational skill, guided by a set of rigorous best practices, and on technological advances.
EPA’s findings also effectively endorse the strong environmental stewardship that is being exercised by state regulators, who have been busy while EPA studied.