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Truckers join fight against low carbon fuel standard

In states like California that have adopted low carbon fuel standards, truckers are emerging as one of the biggest opponents – and with good reason. The American Trucking Association recently joined in a lawsuit against the California Air Resources Board over the state’s low carbon fuel standard, which it says would not only open the door to an increase in foreign crude oil, but would also make it harder for truckers in California to compete with those in neighboring states.

The truckers have a point. While we here at CEA have been largely focused on the threat such standards posed the overall domestic oil industry, low carbon fuel standards could also make interstate commerce a lot more difficult, especially if different states pass different variations of the law.

It’s very similar to what could happen on a global scale. While a preference for lighter crudes from far away could trigger a surge oil imports, businesses looking to save costs locally could simply hire truckers from, say, Nevada, instead of California, who must pay dearly to comply with the low carbon fuel standard and inevitably will pass that cost along to their customers.

In some instances, a low carbon fuel standard might require truckers to buy new trucks capable of running on so-called low-carbon fuels, at a cost of $100,000 or more per vehicle. It’s a staggering amount that truckers will be hard pressed to afford, particularly if they see increase competition from out-of-state fleets.

This story notes that out-of-state truckers running on more affordable heavy fuels “might continue to pass through parts of California with impunity.” Alternatively, in-state truckers based close to the border could just drive to another state to fill their tanks. A new set of winners, losers … and scammers would emerge. And all for what? Increased dependence on oil from Saudi Arabia and other places far from home.

More about that letter writing campaign

Last year, CEA launched a successful campaign, which we later reported, sent a bundle of letters supporting responsible drilling to Interior Secretary Ken Salazar. More, recently, we’ve highlighted reports confirming what we said: That those in favor of expanded drilling outnumbered opponents by a two-to-one margin.

Seemingly a cause for celebration, except that no one from Interior is focused on this issue. This disparity between what the public wants and what is happening in Washington is increasingly cause for concern.

The latest to weigh in on the injustice is the Heritage Foundation, which cites that same gaping two-to-one margin (how often is any election won by so much?) and asks the very reasonable question How about some transparency on offshore drilling?

“Government inaction simply doesn’t make sense,” notes Heritage, which last year also sponsored a successful Free Our Energy campaign. “Offshore drilling will create jobs and increase energy supply without cost to the taxpayer. It will create revenues for financially strapped state government and increase revenues for federal governments. President Obama said in his State of the Union address that we should make tough decisions about offshore drilling. It sounds like a pretty easy decision.”

In view of such disregard of overwhelming public opinion, it seems that making your opinion heard – while still vital – is no longer sufficient. In 2010, there will be battles over energy policy, but we will also need to get the word out that the public has spoken and that their views are being discarded. In the coming weeks and months we will provide more information about how to keep the pressure on lawmakers to do the right thing with regards to national energy policy.

In the meantime, keep in mind that two-to-one ratio. It’s a remarkably strong vote of confidence for the policies we at CEA promote. Two out of three people support expanded offshore drilling: The more those numbers are shared, the more pressure the Interior Department will come under to remove some of that red tape that stands in the way of sensible policy.

CEA: New Study Reveals Economic Consequences of Continued Inaction on American Energy Exploration

NARUC study finds U.S. economy has much to gain from responsible onshore and offshore energy exploration – and much to lose under restrictive status quo

WASHINGTON, D.C. – February 15, 2010   America’s reliance on foreign countries for its energy will grow by 19 percent over the next 20 years, accelerating the transfer of U.S. wealth to members of OPEC by more than $600 billion. That’s just one of the startling conclusions found in a new report issued today by the National Association of Regulatory Utility Commissioners (NARUC) at the group’s winter meeting in Washington – all, assuming a scenario in which policy-makers keep intact decades-old restrictions on accessing America’s abundant, available energy resources.

“It’s easy to measure how the positive development of energy contributes to the creation of jobs, the generation of government revenue, and the stabilization of energy prices,” said David Holt, president of Consumer Energy Alliance (CEA), and a presenter at NARUC’s meeting this week. “It’s a lot harder trying to assess the opportunity cost we’re forced to pay by not producing that energy – how many jobs we stand to lose, how much additional money we’d have to send to OPEC. Now, thanks to this NARUC study, we have such a relative indicator. And let me tell you: It’s not pretty.”

The NARUC study, assembled by experts from the Science Applications International Corporation (SAIC) and the Gas Technology Institute, broadly examines the social, economic and environmental impacts associated with the continuation of a policy that has for generations kept billions of barrels of American oil and trillions of cubic feet of American natural gas under statutory (and de facto) lock-and-key. To do that, the study first provides the most up-to-date assessment of America’s onshore and offshore oil and natural gas resources. It then uses the well-respected National Energy Modeling System (NEMS) to render a quantitative summary of the jobs, revenue and even number of “housing starts” Americans should expect to surrender in the future under the status quo energy policies of today.

“Higher energy prices, greater volatility, expanded foreign dependence, and $2.3 trillion less for everyday Americans to spend – and that’s just the tip of the iceberg,” added Holt. “The good news is that this report describes a scenario for the future that we don’t have to accept – and mustn’t. The bad news is that, despite overwhelming support for new energy exploration among the American people, the inertia of inaction that has defined this debate will be difficult to reverse. With the help of this report, though, it’s my hope that it’s an effort about which we will finally get serious.”

The following represent some of the key findings contained in the study – again, modeled under a scenario that assumes energy resources on federal lands (onshore and offshore) currently locked away continue to be denied to the American people in the future:

  • American production of crude oil: Projected to decrease – relative to a scenario in which we decide to produce our offshore energy resources –by 9.9 billion barrels, an average annual decrease of nearly 15 percent;
  • Imports of oil from OPEC: Projected to increase by 4.1 Billion barrels, an average annual increase of nearly 19 percent, resulting in increased cumulative payments to OPEC of $607 Billion;
  • American production of natural gas: Projected to decrease by 46 Tcf – an average annual decrease of nearly 9 percent;
  • Employment (energy intensive industries): Projected to decrease by nearly 13 million jobs;
  • Housing Starts: Projected to decrease by nearly 200,000;
  • Annual average natural gas prices increase by 17 percent;
  • Annual average electricity prices increase by 5 percent;
  • Real disposable income: Projected to decrease cumulatively by $2.34 trillion;
  • Energy costs to consumers: Projected to increase by $2.35 trillion – an annual average increased cost of 5 percent;
  • Gross Domestic Product (GDP): Projected to decrease by $2.36 trillion;
  • Real Consumption: Projected to decrease by $1.44 Trillion.

For more information, visit www.naruc.org.

Washington, offshore drilling, and you

In his State of the Union address last month, President Obama got a lot of people excited when he mentioned that it was time to “make tough choices on offshore drilling” in a sentence that initially seemed to suggest he was open to considering some new projects. That sense of hope may be short-lived, however, when you examine all of the recent decisions by the Administration that indicate a reluctance to fully encourage access to our domestic resources. All you had to do was look at the current Interior Department’s track record to conclude that, much like previous Administrations, it has been more focused on setting up barriers than to helping responsible drilling proceed.

This blog argues that, far from suggesting he might be open to more drilling on the country’s Outer Continental Shelf, Obama may have meant the exact opposite:

“Maybe by ‘tough choices’ (the President) meant deciding not to open up the OCS for more exploration. That’s exactly what Interior Secretary Ken Salazar has been doing for the last year.”

CEA has repeatedly highlighted past and present Interior Departments’ uses of stall tactics and red tape that has resulted in a historically low number of lease sales for oil and gas development, which, in turn, leads to reduced revenues for the federal government, fewer jobs and a worsening economy.

But we are also doing more than just keeping track of what has been going on in Washington for the past decade. By rallying support for responsible drilling onshore and off, as well as advancing expanded use of alternative energy, we’ve made considerable progress against opponents who are often more vocal and visible than we are. And by encouraging our company members and individual supporters to make their voices heard in various letter writing campaigns to Interior Secretary Salazar and others, we’ve demonstrated that a majority of Americans are on our side.

 

The Wall Street Journal recently reached the same conclusion, reporting that public comments supported expanded offshore drilling by a margin of two-to-one.

We have to believe this groundswell of support means that hope is not lost and that we must continue to work with the Administration on ways to improve our national energy policy.  Obama might not have meant that he’d support more drilling when he alluded to the “tough decisions” that awaited him. But with a growing demand for more domestically-produced power, for more jobs and for a swifter economic recovery, it is time that we ask our leaders in Washington to review our national energy policy and listen more closely to what we have to say. We all need to work together to redouble our efforts and get the word out about the urgent need for responsible domestic energy production.

N-O Canada! Whole Foods Bows to Pressure Groups on Canadian Oil-Sands, Provides China with New Opening to Claim U.S-bound Energy

WASHINGTON, D.C. – February 11, 2010   It may be true that energy resources derived from Canada’s oil-sands today are 33 percent less carbon-intensive than they were a decade ago. It may be true that emissions from the oil-sands are lower than heavy oil production in many U.S. states. And it also may be true that diverting millions of barrels a day of secure, oil-sands energy to far-away China may actually increase global GHG emissions – all while costing Americans their jobs, and expanding our already dangerous dependence on energy from the Middle East.

Unfortunately, for executives at Whole Foods and Bed Bath & Beyond, none of that seems to matter.

Following the announcement yesterday that these two companies — in partnership with the environmental pressure group ForestEthics — will attempt to purge oil sands-derived energy from their transportation fleets, Michael Whatley, vice-president of Consumer Energy Alliance and a leading American expert on the oil-sands, released the following statement:

“The anti-oil sands position taken by these companies fails to take into account that GHG emissions from oil sands are comparable to other U.S. crude oil imports – and continue to go lower every year,” said Whatley. “More than that, it fails to recognize that turning our backs on this secure, affordable, North American energy resource will simply allow our competitors in China and elsewhere to claim energy that would’ve otherwise come to us — rendering our country even more dependent on the Middle East for its energy.”

According to a story posted yesterday by the Canadian Press, Whole Foods’ master plan to purge its transportation fleet of energy derived from the oil-sands appears to be focused on a single refinery in a single state – begging the question of how the company intends to apply this new policy to its remaining 288 locations spread across three countries. Also left unaddressed is how Whole Foods locations in states such as Montana, Wisconsin, Minnesota, Michigan and Illinois can possibly expect to comply with this stricture – given that more than 50 percent of petroleum supplies available in these states come from Canada.

“These announcements send a troubling message to our closest strategic and trading ally,” Whatley added, citing our nation’s long-time partnership with Canada. “One can only assume these companies will also boycott heavy oil produced in places like California, Mexico and Venezuela – as well as crude produced in the Middle East, and then shipped over 10,000 miles to get here. Otherwise, this exercise seems fairly hypocritical in the best case, and downright disingenuous in the worst.”

The announcements will certainly be welcome news to our competitors in China, who would like nothing more than to claim for themselves the secure, affordable, North American energy resources that would have otherwise be sent to consumers here in the U.S. In particular, Whatley pointed to the recent investment by the Chinese government of nearly $2 billion to purchase oil-sands concessions in Alberta – the clearest indication yet that the Chinese are actively working to secure these resources for themselves.

Independent analyses have also confirmed this plan. According to a report compiled by President Obama’s top energy analyst at the U.S. Department of Energy, closing off U.S. markets to oil-sands energy would simply open up new opportunities for China to send that energy thousands of miles abroad, potentially increasing global greenhouse gas emissions while rendering the United States even more dependent on unstable Middle East oil to run its economy.

“While CEA stands four-square against the decision made by these firms this week, we also recognize this may be an opportunity to work with these companies – and others that might be considering a similar course of action – to educate them on what the oil-sands are really about, and how they can be used to create jobs here at home and strengthen America’s energy security, all while protecting and preserving our environment,” Whatley concluded.

READ MORE

CEA February 2010 Newsletter

CEA Newsletter
Issue 35

Message from CEA President David Holt
In recent days, President Barack Obama delivered his first State of the Union address which focused on an increase in government action to combat the nation’s existing economic problems. The President called for assertive development of safe, clean nuclear power as well as increased energy efficiency and renewable energy.

CEA is in complete agreement with the President’s emphasis on these areas of American energy production, but stand strong on our stance that responsible development of these resources must occur as part of a balanced, all-of-the-above energy policy that includes traditional resources, such as oil and natural gas, in addition to alternative sources.

Currently, actions are speaking louder than the words of the President’s recent speech. Over the past year, the Administration has put the brakes on many essential American energy developments, including production of oil shale in the western United States and American offshore resources. The Administration has revoked many oil and gas leases which had already been issued resulting in the potential loss of millions of dollars in royalties for the nation and numerous jobs for its people.

Numerous other initiatives promoted by the Administration would have negative impacts on the economy, including hiking taxes on America’s oil and gas companies – a policy that would lower domestic energy production at a time when the nation needs increased energy sources.

When the nation is calling out for more energy, the Administration is taking action to restrict its development. During the past year, fewer onshore and offshore acres have been leased than in any previous year on record and the government brought in less than 1/10th of the revenue from oil and gas lease sales in 2009 than the year before.

Words are only as strong as the actions behind them. Right now, the United States needs robust and stable energy policy that will encourage economic recovery and job creation. The Administration’s actions are in direct conflict with progress in these areas.

The United States must not unreasonably restrict development of traditional energy sources, such as oil and natural gas. Unnecessary restriction of American resources would put a heavier burden on an already struggling economy and hinder the future success of the United States and her citizens while forcing a stronger national dependence on unstable foreign resources.

The focus of our nation’s energy policy should be balance – a balance between concerns over the environment and climate with the responsibility of ensuring the well-being of the American people, job creation and economic growth. To keep the nation’s interests in balance, it is essential that U.S. energy policies reflect an all-of-the-above approach that includes reasonable and responsible development of traditional resources as well as alternative sources, including solar, wind, wave and more.

As the Administration develops its energy initiatives, CEA is working hard and moving forward in promoting policies and education that will benefit all American consumers. We recognize the importance of American energy development of all types of energy and are working with lawmakers and stakeholders to develop policies favorable to domestic production of renewables and traditional sources.

Thank you for being an active part of CEA. Working together, we will meet our nation’s energy challenges and help secure a successful economic future for America. Your support is critical.

David Holt
President
Ensure a Balanced Approach to America’s Offshore & Ocean Resources!
Currently, the federal government is considering a plan for our nation’s oceans that, if implemented, would significantly impair our nation’s ability to safely develop its own offshore energy, including oil, natural gas and renewable energy. To help ensure that the Administration and the Ocean Policy Task Force adopt a framework that will strengthen the American economy and improve energy security, please submit a comment in support of the safe and responsible development of U.S. offshore resources. Send in your comments today!
Help Defeat Efforts to Ban North American Energy and Increase Prices at the Pump!
The Low-Carbon Fuel Standard (LCFS) is being sold to the American public as a way to blend transportation fuels with low-carbon alternatives so that tailpipe CO2 emissions can be reduced. But the fact is that affordable and reliable lower-carbon fuel options are not yet available. As a result, an LCFS simply will increase the cost of diesel fuel and gasoline and will place certain domestic supplies of transportation fuels off limits. Increasing the cost of transportation fuel and U.S. dependence upon foreign sources of petroleum is simply unsound energy policy.

Join our effort to defeat these measures, which would put an economic stranglehold on America and leave U.S. consumers stuck with higher prices at the pump. Send in your comments today!
Visit the CEA Store – Show your support!
CEA recently launched an online store complete with CEA and domestic energy development-themed merchandise. We’ve included many unique items that will appeal to every taste and budget, such as T-shirts, sweatshirts, bags, yard signs, buttons, mugs and even a doggie-sized T-shirt for your four-footed friend. Help CEA spread the word regarding the necessity of a balanced energy policy for America! Visit the CEA Store today.

CEA Welcomes New Affiliate Members
CEA is proud to announce the addition of several new affiliate members who have joined our alliance in recent months: American Public Power Association, Association of Oil Pipelines and Nucor Steel. For a complete list of CEA’s valued affiliates, click here.
CEA Blog: One Year Later, Actions Speak Louder Than Words
Check out CEA’s recent blog entry about the actions and restrictions of the Obama Administration during 2009 related to American energy development. Join the conversation at CEA’s website. Read blog…
Consumer Corner: Bring Your Green To WORK!
Maybe you’ve already made your home energy-efficient – now it’s time to take your green to work! EnergyStar.gov is currently promoting a nationwide campaign that encourages all Americans to practice energy efficiency not only in their homes, but also their workplaces.

First things first – create a “Green Team” at your office that encourages others to make an effort when it comes to saving energy. Then, follow a simple checklist to implement green tips. Included on the list are: 1. Set your computer and monitor to automatically enter “power save” mode when not in use, 2. Use a power strip as a central turn-off spot, 3. Unplug laptops, cell phones and chargers after use – leaving them plugged in wastes energy!, 4. Swap out old-fashioned light bulbs for new Energy Star qualified bulbs – last 10 times longer and use 75% less energy!, and 5. Keep air vents unblocked so that air can flow freely. Start your Green Team today!

China Surging Ahead With Clean Energy Development
Over the past year, China has greatly expanded clean energy development efforts, including attaining the position of the world’s largest maker of wind turbines, sparking concern that the United States is falling behind. Read article…
Federal Government Announces Energy Efficiency Plans
The White House recently announced plans to reduce the federal government’s energy use and emissions by 28 percent (from 2008 levels) by 2020. Read article…
Opinion: Highway Users & Energy Companies: Where do our interests meet?
By Greg Cohen, American Highway Users Alliance

With motorists, bus drivers, truckers, RVers, and motorcyclists dependent on reliable and affordable energy, the inseparable relationship between highway users and energy is clear and unquestionable.  Thus, it is not surprising that both the highway and energy industries often support the same policies, including support for additional, stable supplies of fuel and maintaining a strong user fee principle for highway funding.

Both highway users and the energy community agree that an excise tax on gas is necessary to maintain our roads.  And as long as the tax on petroleum is seen by politicians and the public as a user fee specifically for highway usage, legislators cannot use it as a blank check to pursue broad ideological agendas. With this in mind, as long as the user fee is maintained, the United States will continue to have among the lowest taxes on petroleum among industrialized nations. For highway users, this means a cheaper and safer trip.  For energy companies, this means limits to taxation and a better bottom line.

Every day, energy companies and highway users encounter many of the same painstaking issues as we attempt to make the improvements and innovations necessary to keep America moving.  Despite incredible engineering advances that make our modern projects overwhelmingly beneficial for people and the environment, we face the same adversaries.  Both energy and highway projects are routinely delayed for decades by bureaucratic red tape, and opponents remain ever hungry to target our industries for taxation and regulation.  Our consumers are also targeted by those who wish to change our behaviors – sometimes through coercive measures developed by unelected bureaucrats.  We therefore share a unique set of challenges and typically share the same supporters and opponents.

Politically active highway users recognize this, and have reacted to many of these challenges by cooperating hand-in-hand with the energy industry to raise awareness of the benefits of each other’s projects.  Often, the solutions to project delays in the highway and energy fields are similar.

On the nation’s most prominent topic of energy discussion, “cap-and-trade”, the American Highway Users Alliance has joined with some energy companies and many other partners to oppose legislation that places a disproportionate burden on the oil industry.  While we envision a cap-and-trade bill that could garner our support, we have not found one in either the House Waxman-Markey bill or the Senate Kerry-Boxer bill.  We continue to look for Senators who are open to a plan that would exempt downstream fuels from the cap and apply fuel cost increases to highway project funding.  And we have worked tirelessly to publicize the damaging effects that the Waxman-Markey bill would have on fuel prices.

The mutual interests of the highway and energy communities will continue to intersect, just as they do at every gas pump in America, and we will continue to work together on these issues to help make America safer and more mobile.  As two industries that are so vitally important to America’s economy and culture, it is a great relationship to be in.

For more information on the American Highway Users Alliance, visit www.highways.org.
Affiliate Spotlight: Independent Petroleum Association of America
The Independent Petroleum Association of America (IPAA), headquartered in Washington, D.C., is the leading, national upstream trade association representing 5,000 independent oil and natural gas producers and service companies located throughout the United States.

“IPAA is dedicated to ensuring a strong, viable oil and natural gas industry in America, recognizing that an adequate, reliable, affordable and secure supply of American energy is essential to the national economy,” says President and CEO Barry Russell.

From its roots 80 years ago when IPAA began protecting the business interests of America’s independent oil and natural gas producers, the organization continues its mission today. Independent producers currently develop 90 percent of the oil and gas wells in the U.S., produce 68 percent of American oil and produce 82 percent of American natural gas.

“Independent producers are the small, high tech businesses that employ on average 12 employees and drill nine out of every ten wells across the country today. Our members are in the business of energy, which is why America’s national energy policy is of great concern to our association,” explains Russell.

IPAA believes that policymakers should encourage the growth of all energy sources.

“When you reduce investment in American energy resources the result is less American production, lost jobs, more foreign dependency, weakened national security and higher prices for Americans. This is the wrong course for America, especially during an economic recession when American oil and natural gas production has proven to be a job creator and revenue provider for decades,” he emphasizes. “American oil and natural gas investment can be a real economic stimulus package if federal policies would encourage its production here at home.”

IPAA believes that America must embrace conservation, efficiency and all forms of American energy for the future.

“Today, oil and natural gas provide two-thirds of our nation’s energy needs, as well as the fuel for many alternative energy projects. The fact remains, that for the foreseeable future, oil and natural gas will be our main fuel source,” Russell notes. “We urge the administration to move forward with commonsense, long term solutions that encourage domestic energy production. American jobs and our national security are at stake.”

IPAA is an affiliate of Consumer Energy Alliance (CEA) because it brings together industries representing diverse sectors of the U.S. economy who are concerned about securing reliable, affordable, American energy for consumers all across the country.

“IPAA believes there is strength in numbers, and playing an active role in CEA affords IPAA a stronger voice on Capitol Hill,” Russell concludes. “We all agree that the United States needs to find commonsense, long term energy solutions that will benefit the economy and strengthen our national security. This can only be done by promoting an all of the above approach to developing America’s energy resources.”

For more information on the Independent Association of America, visit www.ipaa.org.

CEA IN THE NEWS: Salazar-oil industry war escalates as Interior announces leasing changes

Consumer Energy Alliance was in the news on January 6, 2010, in The Hill: “Salazar-oil industry war escalates as Interior announces leasing changes” by Ben German. Read more …

CEA: California LCFS Bad for Consumers, Bad for Producers, and Violates Federal Law

Consumer Energy Alliance files complaint with District Court in Fresno asking for immediate injunction on Low-Carbon Fuel Standard

FRESNO – February 2, 2010   California’s recently implemented Low-Carbon Fuel Standard (LCFS) violates federal law by attempting to regulate “commerce and conduct” outside of the state, while imposing a mandate that even regulators admit will result in “little or no net change” to the carbon intensity of fuels on “a global-scale.” Such is the formal complaint filed by Consumer Energy Alliance (CEA) in the U.S. District Court for the Eastern District of California today, asking the court to suspend the imposition of a statewide LCFS until a number of substantive legal concerns can be addressed.

“The practical outcomes of the California LCFS are higher fuel costs for consumers, dramatic reductions in the availability of those fuels, and a rapid expansion of the state’s already unacceptable level of dependence on foreign, unstable regimes for its energy,” said Michael Whatley, vice-president of CEA and former chief counsel for the U.S. Senate subcommittee on clean air and climate change. “More relevant to today’s filing, the California LCFS also actually violates federal law – and stands in direct contravention of key consumer protections and safeguards enshrined in the U.S. Constitution.”

Formally adopted last month after the state’s Office of Administrative Law (OAL) issued its final approval, the California LCFS, according to its authors, seeks to reduce the carbon-intensity of fuels included in the state’s transportation mix “while stimulat[ing] the production and use of alternative, low-carbon fuels.” But under the bizarre accounting methodology of the plan, energy sources with physically identical chemical properties and carbon contents can – and, in fact, must be – treated differently under the law, with in-state sources significantly advantaged over resources that are found and produced outside California.

“Perhaps it wasn’t the state’s intent, but as written, the California LCFS is an example of parochial protectionism run amok,” added Whatley. “But make no mistake: This isn’t the type of protectionism that will benefit California consumers; it’s the type that will ensure sources of essential energy are harder to find in the future, and much more expensive to purchase.”

In support of that statement, Whatley pointed to a recent analysis of the proposed state LCFS completed by California-based Sierra Research. In that study, analysts from Sierra found that an LCFS will increase the cost of fuel in California by $3.7 billion over the next decade – all while producing “no detectable change in climate.”

With more than 260,000 grassroots supporters and 130 affiliates representing both the major consuming and producing segments of the U.S. energy sector, CEA has been an active contributor to the national debate on LCFS – including the proceedings in California – for the better part of the last two years.

Last August, the Washington, D.C.-based Center for North American Energy Security, a CEA member, sent a letter to the California Air Resources Board (CARB) detailing the myriad short-comings with the LCFS, and several CEA members (including the National Petrochemical & Refiners Association and the American Trucking Associations – which joined CEA in filing the complaint today) have lodged formal comments with CARB objecting to the plan as well. In addition, CEA wrote directly to U.S. Sen. Barbara Boxer (D-Calif.) in October identifying several significant consequences that consumers should expect to encounter under the initiative.

What follows are several key excerpts taken from the CEA complaint filed in Fresno this morning:

42.        Because “carbon intensity” is designed to account not only for a fuel’s physical characteristics, but also the energy necessary to bring the transportation fuel to market in California, chemically identical fuels are assigned different carbon intensities under the LCFS.  LCFS  § 95486(b), Tables 6–7.
44.        By regulating the “fuel pathway” of transportation fuels – i.e., the manner in which transportation fuels are produced and ultimately reach the California market – the LCFS directly regulates interstate commerce and conduct occurring outside of California.
47.        CARB has admitted that, because no other states have adopted a similar standard, “fuel producers are free to ship lower-carbon-intensity fuels to areas with such standards, while shipping higher-carbon-intensity fuels elsewhere.”  CARB, California’s Low Carbon Fuel Standard: An Update on the California Air Resources Board’s Low Carbon Fuel Standard Program (Oct. 2009) at 1.
48.        According to CARB, “[t]he end result of this fuel ‘shuffling’ process is little or no net change in fuel carbon-intensity on a global scale.”  Id.
49.        In fact, the “fuel shuffling” promoted by the LCFS likely will lead to an overall increase in GHG emissions, because it will mean redirecting fuels and feedstocks destined for California to other states through less efficient and redundant supply lines.  Id.; see also CARB, Final Statement of Reasons (Dec. 2009) at 234–35.
50.        The burdens imposed by the LCFS on the interstate market for transportation fuels and fuel feedstocks in California are clearly excessive when measured against the putative local benefits of the LCFS in California.

More from Consumer Energy Alliance’s Secure Our Fuels campaign:

CEA: Interior’s Delay on VA Offshore Energy Exploration Could Cost Jobs, Econ. Growth

Consumer group says safe, responsible offshore energy exploration presents “tremendous economic opportunity”

HOUSTON – January 27, 2010   The Interior Department will not proceed with a long-scheduled offshore energy lease sale in areas 50 miles and beyond the coast of Virginia either this year or next, Reuters reports — despite a request from Virginia Governor Bob McDonnell that commonsense efforts be made right now to ensure that work can finally begin. Following the revelation today from the Department’s Minerals Management Service (MMS), Consumer Energy Alliance (CEA) president David Holt issued the following statement:

“When the governor of the commonwealth of Virginia asks the federal government to partner with his administration in an effort to convert the abundant reserves of energy off his shores into jobs, revenue and energy security for Virginians, you’d hope to see a sensible process move forward. If news today out of MMS is any indication, the federal government appears ready to delay that critical work for at least another year, meaning additional delays in creating jobs, reducing energy costs and getting the U.S. economy moving again.

The Administration should do more to show that it recognizes the tremendous economic opportunity that safe and responsible offshore energy exploration presents to the citizens of Virginia, and the nation at large.

“We’re talking about thousands of high-wage jobs here, and billions in annual revenue that can be raised without imposing a single new tax. When it comes to promoting alternative energy resources offshore, the Administration has compiled an impressive record – and we applaud those efforts. This announcement signals that the Administration may not be looking to maximize our nation’s enormous oil and gas potential offshore with the same enthusiasm.  Those who support a balanced, commonsense national energy strategy look forward to continuing to work with the Administration to create jobs, improve our national and energy security and responsibly allow access to our abundant resources.”

NOTE: Identified by the Interior Department as an area for future lease in 2008, the Virginia lease sale, scheduled currently to take place in 2011, has been delayed for at least another year, according to reports.

Late last year, then-Gov.-elect Bob McDonnell of Virginia (now formally the governor) wrote Secretary Salazar a letter suggesting that “[a]ny effort to remove or delay Virginia’s participation in the lease sale would significantly hamper our efforts to create jobs, eliminate much-needed new revenue, and undermine support for President Obama’s stated commitment to make the United States more energy secure.”

SEA: Salazar Delay on Virginia OCS May Run Afoul of the Law

Fredericksburg, Va. – January 27, 2010   The decision on the part of the Interior Department to delay administrative action on a scheduled and critically important lease sale more than 50 miles off the state of Virginia may not be consistent with the orders of a federal court, the Southeast Energy Alliance charged today.

“The decision by the Department of the Interior is contrary to the expressed wishes of the state of Virginia and appears to violate an order from the US Court of Appeals,” said Michael Whatley, executive director of the Southeast Energy Alliance and former staff director and chief counsel for the U.S. Senate subcommittee on clean air and climate change. “We are deeply concerned about the Department’s decision to take this lease sale off the table — despite strong public support, and clear instructions from a federal court.”

The 2011 Virginia lease sale was included in the 2007-2012 OCS Oil and Gas Leasing Program published by the Department in 2007 following a three-year development process. The 2007-2012 Program has been the subject of lawsuits regarding the environmental sensitivity rankings used by the Department in developing the program. However, on July 28, 2009, the United States Court of Appeals issued a clarification order that limited any changes to the program arising from the litigation to leasing areas in Alaska.

“The Virginia lease sale was included in the Five Year Program at the request of Virginia following years of careful, thorough consideration by the Department of the Interior,” added Whatley. “Public support for the lease sale is extraordinarily strong and Governor McDonnell has stated that he wants to see the lease sale take place in 2011.” Whatley also pointed to a statement posted today on the website of U.S. Sen. Jim Webb (D-Va.), indicating that both Sens. Webb and Mark Warner (D-Va.) support prompt action on the Virginia lease sale.

The Interior Department’s revisions to the 2007-2012 Program are taking place solely because of the ongoing litigation over its Alaskan provisions, and the federal Court of Appeals has ruled that any changes to the plan during the Department’s reconsideration of the Program must be limited to Alaska. “For the Department to strip it out of the schedule under these circumstances is a direct hit on the families, farms, factories and businesses of Virginia,” Whatley concluded.

SEA is the Southeastern regional affiliate of the Consumer Energy Alliance.

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