Harming the economy, degrading the U.S. grid: another day at the EPA.
At an unusual gala ceremony on the release of a major new Environmental Protection Agency rule yesterday, chief Lisa Jackson called it “historic” and “a great victory.” And she’s right: The rule may be the most expensive the agency has ever issued, and it represents the triumph of the Obama Administration’s green agenda over economic growth and job creation. Congratulations.
The so-called utility rule requires power plants to install “maximum achievable control technology” to reduce mercury emissions and other trace gases. But the true goal of the rule’s 1,117 pages is to harm coal-fired power plants and force large parts of the fleet—the U.S. power system workhorse—to shut down in the name of climate change. The EPA figures the rule will cost $9.6 billion, which is a gross, deliberate underestimate.
In return Ms. Jackson says the public will get billions of dollars of health benefits like less asthma if not a cure for cancer. Those credulous enough to believe her should understand that the total benefits of mercury reduction amount to all of $6 million. That’s total present value, not benefits per year—oh, and that’s an -illion with an “m,” which is not normally how things work out in President Obama’s Washington.
The rest of the purported benefits—to be precise, 99.99%—come by double-counting pollution reductions like soot that the EPA regulates through separate programs and therefore most will happen anyway. Using such “co-benefits” is an abuse of the cost-benefit process and shows that Cass Sunstein’s team at the White House regulatory office—many of whom opposed the rule—got steamrolled.
As baseload coal power is retired or idled, the reliability of the electrical grid will be compromised, as every neutral analyst expects. Some utilities like Calpine Corp. and PSEG have claimed in these pages that the reliability concerns are overblown, but the Alfred E. Newman crowd has a vested interest in profiting from the higher wholesale electricity clearing prices that the EPA wants to cause.
Meanwhile, the Federal Energy Regulatory Commission, which is charged with protecting reliability, abnegated its statutory responsibilities as the rule was being written.
One FERC economist wrote in a March email that “I don’t think there is any value in continuing to engage EPA on the issues. EPA has indicated that these are their assumptions and have made it clear that are not changed [sic] anything on reliability . . . [EPA] does not directly answer anything associated with local reliability.” The EPA repeatedly told Congress that it had “very frequent substantive contact and consultation with FERC.”
The EPA also took the extraordinary step of issuing a pre-emptive “enforcement memorandum,” which is typically issued only after the EPA determines its rules are being broken. The memo tells utilities that they must admit to violating clean air laws if they can’t retrofit their plants within the EPA’s timeframe at any cost or if shutting down a plant will lead to regional blackouts. Such legal admissions force companies into a de facto EPA receivership and expose them to lawsuits and other liabilities.
Original column here.
Thursday, December 22, 2011
Sunday, December 18, 2011
WSJ: The EPA's Fracking Scare
Breaking down the facts in that Wyoming drinking water study.
The shale gas boom has been a rare bright spot in the U.S. economy, so much of the country let out a shudder two weeks ago when the Environmental Protection Agency issued a "draft" report that the drilling process of hydraulic fracturing may have contaminated ground water in Pavillion, Wyoming. The good news is that the study is neither definitive nor applicable to the rest of the country.
"When considered together with other lines of evidence, the data indicates likely impact to ground water that can be explained by hydraulic fracking," said the EPA report, referring to the drilling process that blasts water and chemicals into shale rock to release oil and natural gas. The news caused elation among environmentalists and many in the media who want to shut down fracking.
More than one-third of all natural gas drilling now uses fracking, and that percentage is rising. If the EPA Wyoming study holds up under scrutiny, an industry that employs tens of thousands could be in peril.
But does it stand up? This is the first major study to have detected linkage between fracking and ground-water pollution, and the EPA draft hasn't been peer reviewed by independent scientific analysts. Critics are already picking apart the study, which Wyoming Governor Matt Mead called "scientifically questionable."
The EPA says it launched the study in response to complaints "regarding objectionable taste and odor problems in well water." What it doesn't say is that the U.S. Geological Survey has detected organic chemicals in the well water in Pavillion (population 175) for at least 50 years—long before fracking was employed. There are other problems with the study that either the EPA failed to disclose or the press has given little attention to:
• The EPA study concedes that "detections in drinking water wells are generally below [i.e., in compliance with] established health and safety standards." The dangerous compound EPA says it found in the drinking wells was 2-butoxyethyl phosphate. The Petroleum Association of Wyoming says that 2-BE isn't an oil and gas chemical but is a common fire retardant used in association with plastics and plastic components used in drinking wells.
• The pollution detected by the EPA and alleged to be linked to fracking was found in deep-water "monitoring wells"—not the shallower drinking wells. It's far from certain that pollution in these deeper wells caused the pollution in drinking wells. The deep-water wells that EPA drilled are located near a natural gas reservoir. Encana Corp., which owns more than 100 wells around Pavillion, says it didn't "put the natural gas at the bottom of the EPA's deep monitoring wells. Nature did."
• To the extent that drilling chemicals have been detected in monitoring wells, the EPA admits this may result from "legacy pits," which are old wells that were drilled many years before fracking was employed. The EPA also concedes that the inferior design of Pavillion's old wells allows seepage into the water supply. Safer well construction of the kind normally practiced today might have prevented any contaminants from leaking into the water supply.
• The fracking in Pavillion takes place in unusually shallow wells of fewer than 1,000 to 1,500 feet deep. Most fracking today occurs 10,000 feet deep or more, far below drinking water wells, which are normally less than 500 feet. Even the EPA report acknowledges that Pavillion's drilling conditions are far different from other areas of the country, such as the Marcellus shale in Pennsylvania. This calls into question the relevance of the Wyoming finding to newer and more sophisticated fracking operations in more than 20 states.
***
The safety of America's drinking water needs to be protected, as the fracking industry itself well knows. Nothing would shut down drilling faster, and destroy billions of dollars of investment, than media interviews with mothers afraid to let their kids brush their teeth with polluted water. So the EPA study needs to be carefully reviewed.
But the EPA's credibility is also open to review. The agency is dominated by anticarbon true believers, and the Obama Administration has waged a campaign to raise the price and limit the production of fossil fuels.
Natural gas carries a smaller carbon footprint than coal or oil, and greens once endorsed it as an alternative to coal and nuclear power. But as the shale gas revolution has advanced, greens are worried that plentiful natural gas will price wind and solar even further out of the market. This could mean many more of the White House's subsidized investments will go belly up like Solyndra.
The other big issue is regulatory control. Hydraulic fracturing isn't regulated by the EPA, and in 2005 Congress reaffirmed that it did not want the EPA to do so under the Safe Drinking Water Act. The states regulate gas drilling, and by and large they have done the job well. Texas and Florida adopted rules last week that followed other states in requiring companies to disclose their fracking chemicals.
But the EPA wants to muscle in, and its Wyoming study will help in that campaign. The agency is already preparing to promulgate new rules regulating fracking next year. North Dakota Governor Jack Dalrymple says that new EPA rules restricting fracking "would have a huge economic impact on our state's energy development. We believe strongly this should be regulated by the states." Some 3,000 wells in the vast Bakken shale in North Dakota use fracking.
By all means take threats to drinking water seriously. But we also need to be sure that regulators aren't spreading needless fears so they can enhance their own power while pursuing an ideological agenda.
Original column here.
The shale gas boom has been a rare bright spot in the U.S. economy, so much of the country let out a shudder two weeks ago when the Environmental Protection Agency issued a "draft" report that the drilling process of hydraulic fracturing may have contaminated ground water in Pavillion, Wyoming. The good news is that the study is neither definitive nor applicable to the rest of the country.
"When considered together with other lines of evidence, the data indicates likely impact to ground water that can be explained by hydraulic fracking," said the EPA report, referring to the drilling process that blasts water and chemicals into shale rock to release oil and natural gas. The news caused elation among environmentalists and many in the media who want to shut down fracking.
More than one-third of all natural gas drilling now uses fracking, and that percentage is rising. If the EPA Wyoming study holds up under scrutiny, an industry that employs tens of thousands could be in peril.
But does it stand up? This is the first major study to have detected linkage between fracking and ground-water pollution, and the EPA draft hasn't been peer reviewed by independent scientific analysts. Critics are already picking apart the study, which Wyoming Governor Matt Mead called "scientifically questionable."
The EPA says it launched the study in response to complaints "regarding objectionable taste and odor problems in well water." What it doesn't say is that the U.S. Geological Survey has detected organic chemicals in the well water in Pavillion (population 175) for at least 50 years—long before fracking was employed. There are other problems with the study that either the EPA failed to disclose or the press has given little attention to:
• The EPA study concedes that "detections in drinking water wells are generally below [i.e., in compliance with] established health and safety standards." The dangerous compound EPA says it found in the drinking wells was 2-butoxyethyl phosphate. The Petroleum Association of Wyoming says that 2-BE isn't an oil and gas chemical but is a common fire retardant used in association with plastics and plastic components used in drinking wells.
• The pollution detected by the EPA and alleged to be linked to fracking was found in deep-water "monitoring wells"—not the shallower drinking wells. It's far from certain that pollution in these deeper wells caused the pollution in drinking wells. The deep-water wells that EPA drilled are located near a natural gas reservoir. Encana Corp., which owns more than 100 wells around Pavillion, says it didn't "put the natural gas at the bottom of the EPA's deep monitoring wells. Nature did."
• To the extent that drilling chemicals have been detected in monitoring wells, the EPA admits this may result from "legacy pits," which are old wells that were drilled many years before fracking was employed. The EPA also concedes that the inferior design of Pavillion's old wells allows seepage into the water supply. Safer well construction of the kind normally practiced today might have prevented any contaminants from leaking into the water supply.
• The fracking in Pavillion takes place in unusually shallow wells of fewer than 1,000 to 1,500 feet deep. Most fracking today occurs 10,000 feet deep or more, far below drinking water wells, which are normally less than 500 feet. Even the EPA report acknowledges that Pavillion's drilling conditions are far different from other areas of the country, such as the Marcellus shale in Pennsylvania. This calls into question the relevance of the Wyoming finding to newer and more sophisticated fracking operations in more than 20 states.
***
The safety of America's drinking water needs to be protected, as the fracking industry itself well knows. Nothing would shut down drilling faster, and destroy billions of dollars of investment, than media interviews with mothers afraid to let their kids brush their teeth with polluted water. So the EPA study needs to be carefully reviewed.
But the EPA's credibility is also open to review. The agency is dominated by anticarbon true believers, and the Obama Administration has waged a campaign to raise the price and limit the production of fossil fuels.
Natural gas carries a smaller carbon footprint than coal or oil, and greens once endorsed it as an alternative to coal and nuclear power. But as the shale gas revolution has advanced, greens are worried that plentiful natural gas will price wind and solar even further out of the market. This could mean many more of the White House's subsidized investments will go belly up like Solyndra.
The other big issue is regulatory control. Hydraulic fracturing isn't regulated by the EPA, and in 2005 Congress reaffirmed that it did not want the EPA to do so under the Safe Drinking Water Act. The states regulate gas drilling, and by and large they have done the job well. Texas and Florida adopted rules last week that followed other states in requiring companies to disclose their fracking chemicals.
But the EPA wants to muscle in, and its Wyoming study will help in that campaign. The agency is already preparing to promulgate new rules regulating fracking next year. North Dakota Governor Jack Dalrymple says that new EPA rules restricting fracking "would have a huge economic impact on our state's energy development. We believe strongly this should be regulated by the states." Some 3,000 wells in the vast Bakken shale in North Dakota use fracking.
By all means take threats to drinking water seriously. But we also need to be sure that regulators aren't spreading needless fears so they can enhance their own power while pursuing an ideological agenda.
Original column here.
Wednesday, December 7, 2011
Today's Reading
The Green Agenda is Green With Envy
Senator Inhofe Dances On the Climate Change Grave (Includes Video)
A farewell to alarms.
Senator Inhofe Dances On the Climate Change Grave (Includes Video)
A farewell to alarms.
Saturday, December 3, 2011
Thursday, December 1, 2011
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