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Message from US Consumers to Wash., Mich., NY: Consider the Impacts an LCFS Could Have on Energy Costs, Security

Monday, April 12th, 2010

In a letter last week Washington governor Christine Gregoire, Consumer Energy Alliance (CEA) urges her to fully consider the harmful effects that a Low-Carbon Fuel Standard (LCFS) could potentially have on the state. Signed by president David Holt, CEA’s letter comes almost one year after Governor Gregoire issued an executive order to begin the process of determining whether Washington should implement a California-style LCFS, or a similar proposal.

This from Holt’s letter to the governor:

Adopting a California-style LCFS, aimed at restricting the state’s use of Canadian oil, makes no sense for the state of Washington. Unlike California, Washington receives more than 25 percent of its crude from Canada. An LCFS would not only inhibit the state from obtaining and using that crude, but it would also restrict your state’s access to more than 10 percent of its current gasoline supply, which is refined in Montana and derived from Canada’s oil sands.

Indeed, to replace the supply lost under an LCFS, Washington will likely need to increase crude shipments from the Middle East, leading to additional energy security concerns. And as mentioned, as it relates to the imperative of reducing GHGs, several prominent studies have found that an LCFS may actually generate greater net emissions compared to the reference case (no LCFS) by requiring imports from distant, unstable countries instead of relying on crude from our North American neighbors such as Canada and Mexico. Under this scenario, not only would an LCFS increase our nation’s dependence on foreign energy sources, but it would also add significantly to global GHG concentrations.

As Holt notes, Washingtonians – including the governor and elected state leaders – should understand that an LCFS will not reduce greenhouse gas emissions. In fact, such a misguided policy could lead to severe economic and security consequences for consumers across the state.

Unfortunately, Washington isn’t the only state that is currently considering adopting an LCFS. There’s even efforts underway in Washington to pass a national, one-size-fits-all LCFS.

The Michigan Manufacturers Association (MMA) has been a dogged advocate for policies that aim to reduce and stabilize energy costs for consumers and small businesses across the state. Randy Gross – director of environmental and regulatory affairs at MMA – recently penned a column entitled “LCFS targets U.S. economy”  in the Traverse City Record-Eagle. He also recently wrote a Muskegon Chronicle letter to the editor under the headline “Canadian crude oil, Michigan economy in the crosshairs”. Here are key excerpts:

Most folks may not know how critical our Canadian neighbors are in fueling the Michigan economy. Indeed, more than 63 percent of our state’s gasoline and diesel fuel begins its life as unrefined oil in Canada. Unfortunately, efforts under way in the capital right now threaten that critical relationship — and the millions of people on this side of the border whose jobs and livelihoods depend on continued access to this secure, affordable and reliable energy.

For example, in Detroit the Marathon refinery produces almost 100,000 barrels of a day of gasoline and diesel fuel derived from Canadian energy — energy that provides thousands of good-paying jobs to Michigan families, as well as pensions and health care. In this troubled economy, why would any lawmaker in Michigan even consider putting those jobs on the line?

Our leaders in both Lansing and Washington, D.C., need to say “no” to an LCFS. The people of Michigan cannot afford to adopt a policy that will lead to higher prices at the pump, fewer American and Michigan jobs and threatened energy security. We need legislation that will improve Michigan’s competitiveness, nationwide and worldwide.

And in New York, former Illinois congressman Thomas Corcoran of the Center for North American Energy Security recently took to the pages of the Buffalo News to highlight the devastating effects that an LCFS could have on the Empire State. In a column entitled, “Low-carbon fuel standard would hurt New Yorkers,” Corcoran writes:

Under the standard, secure sources of oil from Canada and even our own Gulf Coast score much worse than sources of crude from Saudi Arabia and Nigeria. Just about every bit of New York’s 75 million- barrel reserve would be targeted for elimination under the low-carbon fuel standard. The Northeast would have to import more light crude from unstable and unfriendly regimes found in the Middle East, Africa and Libya.

The standards could also impact heating oil from New York refineries. Since about one-third of New York households use fuel oil as their primary energy source for home heating and the Empire State required more than $537 million last year in federal funding from the Low Income Heating Energy Assistance Program, restricting New York’s availability and use of home heating fuel just doesn’t make sense.

CEA will continue to lead the drumbeat of support for commonsense energy policies that encourage more energy production of all forms – especially stable and secure North American supplies derived from Canada. At the same time, we will continue to fight for smart conservation measure that will help drive down our demand and overall energy use. We must continue to use what we have more wisely, while working to balance our needs with the energy that we have here at home and in North America.

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LCFS in KGL: Prescription for Higher Fuel Costs and Increased Imports from Unstable Regions of the World

Wednesday, April 7th, 2010

With the recent news that Senators Kerry, Graham and Lieberman are aiming to release their draft climate change legislation sometime in the next month, many policymakers and key stakeholders in Washington, D.C. are speculating about what that bill will actually look like, and what its potential effects may be. While it’s still too early to tell if a national, one-size-fits-all Low-Carbon Fuel Standard (LCFS) will be included in the legislation, Consumer Energy Alliance (CEA) is working tirelessly to educate the public and lawmakers about the harmful economic and national security implications associated with this job-killing proposal.

Thomas Pyle, president of the Institute for Energy Research (IER), writes this in a recent Daily Caller column entitled ”Energy and climate, March Madness-style” about pending Senate legislation, including LCFS provisions:

H.R. 1787 (Inslee LCFS bill): Perhaps not as well known to a broader national audience, the Low-Carbon Fuel Standard (LCFS) bill authored by Rep. Jay Inslee (D-Wash.) is seen by many as a dark horse candidate for advancement—assuming early upsets of stiffer competition. Having toiled this past year in the obscurity that comes with being a mid-major, the Inslee LCFS bill has nonetheless pulled together an impressive resume of support, with more than 20 states currently considering a version of the Inslee plan that seeks to creatively (if not entirely effectively) achieve its emissions reductions by putting the kibosh on energy derived from Canada’s oil sands.

States often serve as indicators – or incubators – for federal policy. In the case of an LCFS, American consumers can only hope that Congress doesn’t take their cues from California – the first state to implement such a mandate. This from a recent Climatewire article about efforts underway in the Golden State to move forward with an LCFS:

Gov. Arnold Schwarzenegger (R) sent a letter to California Air Resources Board (CARB) Chairman Mary Nichols on Wednesday arguing that the state should give most allowances away in the early years of a cap-and-trade program and allow generous use of offsets…”As we have discussed many times, California’s goal is to implement A.B. 32 in such a way as to mesh our program as seamlessly as possible into a comprehensive national strategy,” [Schwarzenegger said.]…CARB spokesman Stanley Young echoed Schwarzenegger. “The crucial determining factor here is what’s happening in Washington, because our goal is to develop a program that will meld seamlessly into a federal program,” he said. “This is about considering the future in terms of how California can become part of a comprehensive national program.”

But do American consumers really want California’s LCFS mandate – which effectively bans stable and reliable forms of North American energy – to be the law of the land from coast to coast? We can’t say for sure.

But what we do know is that the American people oppose higher fuel costs and increased imports from unstable regions of the world. Unfortunately, that is the prescription laid out by an LCFS.

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We Hear Ya: Top Alberta Energy Official Says “We Need to Keep up the Campaign” For Secure, North American Energy

Friday, March 26th, 2010

Let’s face it, the U.S. and global economy are experiencing challenging and difficult times. With nearly 1 out of every 10 Americans still without work, and gas prices on the rise, glimmers of economic hope are too few. Many economists don’t expect the U.S. economy to grow substantially anytime soon, either.

But there is a rare economic bright spot up in Canada: Alberta’s oil sands. In fact, the Edmonton Journal reports that, according to the Canadian Manufacturers and Exporters (CME), the total value of economic activity expected over the next 10 years from the oil sands in Alberta is more than $1 trillion. That’s nearly 75 percent of Canada’s GDP! This is good news for the U.S., too, since more than 2.5 million barrels of oil derived from Canada’s sands are directed to American consumers each and every day in the form of secure and stable North American energy supplies.

This from the article:

In 2009 alone, energy companies poured $30 billion into the oilsands. About 60 per cent of that went into maintenance and supplies, the rest into new project development. Even that’s a hefty sum. CME president Jayson Myers says $30 billion exceeds the value of any government stimulus package for any given year in any state or province in North America.

“As Canadian companies look at new business opportunities and at reducing the risks they’re seeing in the U.S. market, and in their traditional supply chains, the oilsands remain a very attractive business opportunity — even more so as we see project investments begin to increase again,” he says.

And while the U.S. is unquestionably Canada’s strongest and most strategic trading partner, other nations from around the globe also understand the economic benefits associated with access to stable and reliable energy reserves. So it’s no wonder why Petrochina – the Chinese government-owned energy firm – has aggressively invested in Canada’s oil sands. In fact, Bloomberg reports this:

“PetroChina Co. Chairman Jiang Jiemin plans to step up overseas oil and gas acquisitions after teaming up with Royal Dutch Shell Plc to buy Australia’s Arrow Energy Ltd. for $3.2 billion this week. “We will take advantage of opportunities in developing oil, gas and energy sources in all areas of the world,” Jiang said at a media briefing in Hong Kong yesterday, after the Beijing- based company reported a 9.7 percent decline in full-year profit. The Arrow deal followed at least $5 billion of purchases in Canada, Kazakhstan and Singapore in 2009 to meet demand in the fastest-growing major economy. PetroChina last year purchased a stake in a Canadian oil sands project for $1.7 billion, a refinery in Singapore and spent about $1.4 billion on a stake in an oil venture in Kazakhstan.”

So as China – a top competitor in the global economy – continues to secure steady streams of affordable energy, like those produced from Canada’s sands, leaders in the United States are pushing for a one-size-fits-all Low-Carbon Fuel Standard (LCFS), which would effectively ban these secure, affordable, North American energy resources from reaching American consumers, middle-class families and senior citizens.

But not every nation – or groups of nations – share the belief that Canada’s oils sands can and must play a critical role in providing stable energy to those who need it most. Under the headline “Minister says EU was behind oil sands opposition,” Reuters gets Alberta’s energy minister, Ron Liepert, on the record in response to efforts from the European Union to erect trade barriers aimed at Canada’s oil sands:

The European Union is the organization he referred to when he asserted that some international groups were using the environment as a guise to erect trade barriers. … Canada has warned that draft EU standards to promote greener fuels are too unwieldy and would harm the market for oil sands crude.

The EU apparently noticed his warning, since they have now dropped references to oil sands. And just today, under the headline “E.U. may remove oil sands restrictions from environmental standards”, Climatewire reports this:

The European Union may weaken proposed environmental standards for fuel, responding to the Canadian government’s efforts to protect Canada’s oil sands. … Alberta Energy Minister Ron Liepert said he was pleased that the government’s efforts were having an impact. “We’ve managed to convince the New Democrats to quit calling it tar sands and start calling it oil sands. We’ve got the European Union starting to look at the need to reassess some of the initiatives they’ve taken, based on, I would say, not the best information, so we need to keep up the campaign.”

Canada’s not alone in working to get the facts out about its vast oil sands, and how essential these job-creating resources are to American consumers. Consumer Energy Alliance will continue to educate the public about the dangers of an LCFS, and tirelessly advocate for commonsense energy policies that aim to keep prices stable and affordable by promoting more energy of all forms, and using what we have more wisely at the same time.

Unfortunately, discriminating against Canada’s abundant and secure energy – the very core of an LCFS – would only deepen our energy dependence on unfriendly regions of world and hit struggling consumers in their pocketbooks at a time when they can afford it least.

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Canada’s Top US Diplomat: U.S. mustn’t discriminate against Canadian oil sands

Monday, March 22nd, 2010

Canadian Ambassador Gary Doer amplified Canada’s concerns – shared by CEA – with a federal, one-size-fits-all Low-Carbon Fuel Standard (LCFS), as well the number of states considering similar measures late last week. In an interview with Reuters, Ambassador Doer said that the United States should not discriminate against Canadia’s secure oil sands supplies that help keep energy prices affordable for American consumers, warning that trade restrictions could cause Canada to pursue other markets for these job-creating, North American resources.

In a Reuters article by Ayesha Rascoe under the headline, “U.S. mustn’t discriminate against Canadian oil sands,” Doer says this about an LCFS:

“We absolutely want states and provinces to not discriminate against one sector without looking at the big picture,” Doer said. With an estimated 173 billion barrels, Canadian oil sands are the largest source of crude [for the US] outside the Middle East.

Doer continued:

Ultimately if the United States becomes less open to oil sands, Doer said the fuel can go elsewhere. “This is a commodity that can sold somewhere else. It’s not as if the United States is the only country interested in purchasing oil,” Doer said.

Plans are already in place to build a multibillion-dollar pipeline to Canada’s West Coast, where tankers could ship oil sands-derived crude to refineries in Asia, although the industry has said it could supply both markets.

Ambassador Doer brings addresses an important point: Do US consumers want to continue our strong energy trading partnership with Canada to keep our economy moving, or do we want to deepen our dependence on unstable region’s of the world – who just happen to have oil reserves that score better under a convoluted LCFS scoring scheme? An LCFS, after all, favors energy produced nations like Nigeria over Canada. The answer to that question should be clear for all Americans.

Interestingly, similar concerns were echoed by Thomas Pyle, president of the Institute for Energy Research, who recently wrote this about an LCFS on National Journal’s energy blog, under the headline “Consumers Benefit from Free Markets”:

Many independent experts – including a top U.S. Energy Dept. advisor – have determined that global greenhouse gas emission would increase under a one-size-fits-all LCFS. An LCFS, of course, aims to ban heavier forms of secure, North American energy reserves from entering the United States.

Unfortunately, the real loser is the American economy, struggling families and small businesses, which rely on Canada’s oil sands to meet nearly 20 percent of our nation’s daily fuel needs. Other winners? OPEC nations, who produce lighter forms of crude, which scores favorably under a convoluted LCFS scheme.

Each week, more and more policymakers and organizations are recognizing the host of dangerous consequences associated with LCFS schemes. In fact, a recent  Deutsche Bank report determined that America’s strong energy trading partnership with Canada is not only an economic winner but that it’s imperative for US security.

While many Americans still have never heard of an LCFS, Consumer Energy Alliance will continue to educate the public about this terrible misguided policy that could lead to higher prices at the pump, fewer good-paying jobs for Americans and expanded dependence on dangerous, unstable region’s of the world to keep our economy fueled.

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National, State Groups Join CEA in Efforts to Combat Job-Killing LCFS Schemes

Tuesday, March 16th, 2010

Here at Secure Our Fuels, we’ve been working hard to engage and educate concerned consumers, families and small businesses about the overwhelmingly negative economic and national security threats posed Low-Carbon Fuel Standard (LCFS) schemes.

In today’s LaCrosse (Wisc.) Tribune, CEA’s vice president, Michael Whatley, writes this in under the headline: “Proposed standard would hurt customers, manufacturers”:

Sold to the public as a plan to defy the laws of science by forcing a reduction in the carbon content of fuel (which the Environment Protection Agency says is constant), Mial’s reporting rightly calls out the LCFS for what it actually is: an attack on Wisconsin consumers and manufacturers by denying Wisconsin’s chief source of secure and affordable energy from crossing the U.S.-Canadian border. He also captures one of the fundamental realities that LCFS supporters would rather your readers not know; namely, that Wisconsin’s loss under such a policy might just turn out to be Asia’s gain, since it’s likely that far-away interests will “take every gallon” of energy that a Wisconsin LCFS would necessitate we leave behind.

Whatley adds this:

 Unfortunately, even as legislators from both parties in Madison have started to wake up to the harsh realities associated with an LCFS, a group known as the Midwestern Governors Association, of which Wisconsin’s governor is a member, continues down the road of LCFS study and implementation at breakneck pace. Later this year, the association expects to produce a final LCFS plan that states like Wisconsin will be asked to endorse in full. But that proposal won’t get far if more folks in the state take the time to read news items like this one.

Fortunately for the Badger State, the Wisconsin Manufacturers and Commerce (WMC) and the Wisconsin Petroleum Marketers Association (WPMA) have been actively working fend off job-killing LCFS scheme by educating key stakeholders about the host of negative impacts this proposal would have on the state. In fact, both WMC and the WPMA recently released straightforward documents about how an LCFS would hurt Wisconsin, its economy and its ability to compete.

With over 4,000 members statewide, WMC estimates that an LCFS would have the following effects:

The so-called Low Carbon Fuel Standard would cost Wisconsin motorists more than $3.2 billion in higher gas prices according to the WPRI study. This global warming gas tax could cost consumers as much as 61 cents per gallon according to a study by the Marshall Institute. All told, these expensive policies are projected to cost each Wisconsin family more than $1,000 each year by the time they are fully implemented.

In a separate LCFS overview document, the WPMA identifies some of the potential impacts on Wisconsin and other Midwestern states that depend on Canadian derived-fuel supplies to keep their economies moving:

If Wisconsin and other Midwestern states adopt a LCFS, existing and proposed pipeline infrastructure could be used to bypass the region. In addition, Canadian crude will likely be produced for export to developing nations such as China and India. These nations have lower environmental standards than the U.S., which means there would be a net increase in greenhouse gas emissions, and other air pollution, if that crude is ultimately refined elsewhere. It also would be less energy efficient and a potentially greater risk to the environment for Canada to transport its crude abroad by oil tanker versus keeping it in North America.

The Midwestern United States is the most efficient transportation destination and refiner of Canadian oil sands crude, which reduces its environmental impact. Oil sands crude oil is a growing resource that is attracting significant investment. If Wisconsin restricts Canadian crude oil, it will be used somewhere else in the world.

Interestingly, some of these same concerns were identified in a recent letter from Thomas Corcoran, executive director of the Center for North American Energy Security (CNAES) — which urges the nation’s governors to oppose an LCFS that would discriminate against affordable and secure fuels, such as those from Canada’s oil sands or other non-conventional sources. In this letter, Corcoran writes this:

 Such a proposal would be misguided for many reasons. First it would not result in any reductions of GHG emissions, but it is likely to increase them. The effect would be to discourage imports to the Northeast of fuels derived from oil sands and other conventional resources in North America, such as the oil sands in Canada or oil shale in the Western U.S. Fuels barred from the Northeast would simply be sold elsewhere in the world, where controls may be more lax and emissions from fuel transportation increased.

 While the debate over an LCFS scheme continues in Wisconsin, it’s clear that the more consumers learn and understand about this job-killing proposal, the more the opposition continues to grow. Unfortunately, the threat of an LCFS still exists in many other states, regions and in Washington. As CEA continues to educate the public about the dangerous realities of adopting LCFS schemes, hopefully more state and national policymakers will take notice and follow WMC’s, WPMA’s and CNAES’s lead by rejecting these misguided proposals.

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Now We’re Talking, Part 1

Monday, March 8th, 2010

Higher energy costs lead to higher utility and gasoline prices for consumers. Enacting a national Low-Carbon Fuel Standard (LCFS) will divert affordable, previously U.S-bound energy supplies from Canada to our competitors, reduce access to critical energy products such as diesel and home heating fuel, and increase prices at the pump – all without doing a thing to reduce global greenhouse gas emissions. In fact, greenhouse gas emissions will increase as we turn our back on North American sourced oil and begin importing increasing amounts of energy from other continents via long ocean voyages. We won’t use less energy because there is a LCFS; we’ll just obtain it elsewhere.

These conclusions are well documented. Please download the PowerPoint on LCFS presented by one of the top energy policy analysts at the U.S. Department of Energy at a transportation conference last summer – and be sure to take a look at slides 16 and 17. You might also scan an LCFS study published in the American Economic Journal by professors from North Carolina and California. According to their research, an “LCFS cannot be efficient…,” and,  “…contrary to the stated purpose, an LCFS can actually raise carbon emissions.”

Since it was founded in early 2006, Consumer Energy Alliance has worked to promote policies that ensure an adequate supply of energy. CEA is not opposed to using cleaner, more environmentally-friendly sources of energy and has embraced a “we need it all approach.” In light of this mission, we were surprised at the recent statement from Natural Resources Defense Council (NRDC) lawyer, Liz Barratt-Brown, who asserted in an environmental advocacy blog that CEA’s opposition to the LCFS must mean that our organization is “against shifting to cleaner fuels”. She alleged that CEA uses “deception” to represent ourselves.

While conducting its research project on CEA, it appears NRDC missed a recent post on our blog hailing the administration’s commitment to energy conservation programs, especially its efforts to promote and sustain a robust plan for home weatherization and re-insulation.  NRDC also missed CEA’s press release applauding the mayor of Houston for getting an important solar energy project across the finish line in that great city. And it must have missed CEA’s many public statements in support of wind power where  more needs to be done, and done now, to cut through the red tape and bring more of these installations online in parts of the country where wind generated electricity is both needed and efficient.

It’s true that CEA counts producers of conventional energy sources among its coalition, after all we are the Consumer Energy Alliance; a complete listing of our affiliates has always been available online. In her NRDC blog, Ms. Barratt-Brown finds it convenient to characterize our organization as an assemblage of “Big Oil” interests. Were her blog even handed, it would note that we represent an even larger number of energy consumers: a full 60 percent of our affiliates are energy consumers. While these consuming groups don’t see eye-to-eye with the producing groups on every issue all of them embrace and support CEA’s broad mission to advance a national energy policy that encourages us to conserve what we have, allows us to safely produce what we need, and invests in the kind of technology we believe will be critical in creating jobs, revenue and opportunity in the future.

It’s a big effort, to be sure, but it is one supported by a larger and more diverse group of interests than NRDC may realize. Among our more than 130 member companies, we’re proud to work with steel manufacturers, plumbing and heating contractors, community and neighborhood organizations, seafood producers, biodiesel producers, fertilizer groups, truckers, airlines, tourism officials, and many, many others. But the backbone of our organization isn’t found there. It’s made up of the more than 265,000 everyday Americans who have signed up over the years to support our cause, men and women who believe in a balanced, sensible energy strategy for this country, and understand the relationship between such a strategy and the creation of jobs, security and affordable energy.

Yes, we disagree with NRDC on some issues. However, there is reason to believe that we agree on a number of other matters. We know that NRDC is not anti-consumer just as we are not anti-environment.

I’m delighted to continue a dialogue in the future, and I’m also hopeful that we can dispense with the personal attacks and schoolyard insults, and get down to the serious business of crafting commonsense energy solutions for the American people.

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Fmr. NHL Goalie Takes Slap Shot Directly at U.S. Energy Security

Thursday, February 25th, 2010

Remember the 1994 Stanley Cup finals? As you may recall, Mike Richter – the goalie then for the New York Rangers – played a significant role in securing Lord Stanley that year, bringing a close to the fabled “Curse of 1940.” In fact, in an action-packed, edge-of-your-seat Game 4 shoot-out, Richter famously shut down Pavel Bure – the Vancouver Canucks sharp-shooting, fast-flying forward.

And while Richter effectively handled the “Russian Rocket” in ’94, raining on the parade of Canadian hockey fans, the U.S. Hockey Hall of Famer is now working to undercut our nation’s energy security.

Taking to the pages of Minnesota’s largest newspaper, Richter – the outreach chair on the Sierra Club’s National Advancement Council – writes this in a recent Star Tribune column under the headline “Of Canada, the Olympics and dirty oil”:

If we allow Canada’s oil sands project to creep across our border, it will lock our nation into dependence on yet another foreign source of oil, just as our local clean-energy industry is beginning to thrive.

However, Canada currently helps meet nearly 17 percent of the total fuel demands that keeps the American economy running each day. In fact, Canada – not Middle Eastern oil, or oil derived from other unstable, unfriendly regions of the world – is our nation’s top oil provider. So how much of Minnesota’s oil comes from Canada’s sands? 83 percent. And why does Mr. Richter support denying Minnesota consumers, manufacturers, families and seniors living on fixed-incomes access to these affordable North American energy reserves? You should ask him.

Richter adds this in his column:

Right now, we are poised to become a leader in the global clean-energy economy. By taking the steps to ensure that we are the leader of the next industrial revolution, we can reignite our economy, bolster national security and improve the health of our people.

One of the most important things we can do to demonstrate that leadership is to say no to Canada’s oil sands. For now, the decision rests with the Obama administration. By denying permits for pipelines and refineries in the United States, President Obama can signal to the world that we are serious about fighting climate change and helping American clean-energy technologies thrive.

Everyone – including Mr. Richter – is entitled to their own opinion. However, no one is entitled to their own set of facts.

Consider this: If the federal government, or individual states, were to ban Canadian oil from reaching American consumers – as a Low-Carbon Fuel Standard (LCFS) seeks to achieve – where would the fuel come from to meet our nation’s growing energy needs and to help drive economic activity and growth?

Lighter forms of crude are generally found and produced in some of the most hostile regions of the world. Understanding that the Energy Information Administration (EIA) – the U.S. Energy Department’s statistical and analytical agency – has determined that our nation will continue to rely on oil until at least 2035, is it responsible or commonsense policy to turn our backs on Canadian oil to meet these rising demands, and to favor oil from faraway, hostile regimes?

But assuming that the U.S. adopts the misguided policies that Richter is advocating for, what are the ultimate consequences? Who are the winners and losers?

American consumers – who will be forced to pay even higher prices at the pump – are the ultimate losers.

And if the U.S.  banned Canadian energy, does that mean global greenhouse gas (GHS) emissions will decrease? Absolutely not. China – our chief competitor in the global economy – is working aggressively to secure access to Canada’s oil sands. Some independent experts – and even a top advisor to President Obama – have determined that GHGs would actually increase under such a unilateral ban on these resources from the U.S.

The winners? Well, those who have an economic and financial interest in ensuring that our most affordable, reliable and secure forms of energy become prohibitively expensive. Say, for example, a venture capital firm that invests in alternative forms of energy that simply cannot compete with more affordable forms, such as Canada’s oil sands. That’s funny, because Mr. Richter is the founding partner of Environmental Capital Partners (ECP) — a firm that does just that. Coincidence? We’ll let the American consumers decide.

As U.S. consumers continue to weather these terribly difficult and challenging economic times and hardships, and more and more jobs continue to be lost, leaders in Washington and in state capitols must focus on advancing energy policies that aim to keep prices stable and affordable by promoting more energy of all forms, and using what we have more wisely at the same time. Regrettably, banning Canada’s oil – the core of a LCFS – would only deepen our dangerous dependence on oil from unfriendly regions of world, and severely hit struggling consumers in their pocketbooks at a time when they can afford it least.

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JUST THE FACTS: Efforts to Block Canadian Energy Bad News for US Consumers, Christmas Early for China

Tuesday, February 23rd, 2010

Last week, following the announcement that Whole Foods and Bed Bath & Beyond intend to turn their corporate backs on secure, affordable, North American energy derived from Canada’s oil sands for their transportation fleets, a host of stories from both Canadian and U.S. news outlets quickly surfaced. However, Bed Bath & Beyond is beginning to hedge its position, understanding full-well how critical the U.S.-Canadian trading partnership is, especially as it relates to affordable energy. BNET reports this:

Turns out, though, that boycotting oil sands also puts your brand at risk. Just one day after the big announcement BB&B distanced itself from the boycott, Alberta consumers and businesses called for a boycott of BB&B stores in the province in response to the attack on oil sands, the Globe and Mail reported.

Consumer Energy Alliance’s (CEA) fired off a statement shortly have last week’s misguided Whole Foods announcement, which was highlighted in a Calgary Herald article:

CEA flooded the media with an e-mailed statement by its vice-president, Michael Whatley, saying the Whole Foods boycott is “hypocritical in the best case and downright disingenuous in the worst.” As Whatley said of the Whole Foods situation: “We recognize this may be an opportunity to work with these companies 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.”

Globally, the thirst for affordable energy continues to swell, especially in developing and emerging nations, such as China. Whole Foods’ objective – to ban Canadian oil sands, which would be achieved under a federal, one-size-fits-all Low-Carbon Fuel Standard (LCFS) – will result in higher prices at the pump for U.S. consumers, and a deeper, more dangerous dependence on some of the most unstable and unfriendly regions of the world to keep our economy fueled.

As it relates to China’s strategic positioning to secure Canada’s job-creating energy reserves, BNET reports:

The industry is already preparing for the possibility of a real threat from U.S. businesses and government policies that would reduce use of oil sands: They’re looking east to China. PetroChina recently acquired a majority share in two oil sands projects — an investment that required Canadian government approval. “There will definitely be more,” Prime Minister Stephen Harper told the Guardian.”

And under the headline “China eyes tar sands as Western firms back off,” Greenwire reports:

As U.S. and European companies scale back investment in oil sands due to environmental and cost concerns, Chinese oil companies are making their largest investments to date. “Expect more Chinese investment in the resource and energy sectors,” Canadian Prime Minister Stephen Harper said.

“There will definitely be more.” Peter Tertzakian, chief energy economist at ARC Financial Corp. in Calgary, said China’s investments currently appear to be a “token toehold” in the market. He said the Canadian government appears to have become more willing to accept Chinese investment in the oil sands. “From a continental energy security perspective, of course there is a little more hesitation when emerging powers come here, but the Canadian government has over the last year indicated more willingness to do business with China,” Tertzakian said.

Like many American consumers, CEA is concerned that China’s insatiable appetite for energy resources to continue to aggressively grow its economy, coupled with the consideration of job-killing LCFS proposals across the U.S. and in Washington, could send a troubling message to our strongest and most important trading partner to the north.

Interestingly, this important topic will likely be discussed later this week in Washington when the nation’s governors and seven of Canada’s premiers meet at the National Governor’s Association (NGA) conference. The Canadian Free Press’ Lee-Ann Goodman reports this under the headline “Premiers, governors talk tough topics; Energy, trade, environment lead agenda”:

The premiers of Ontario, Quebec, Saskatchewan, Manitoba, Nova Brunswick, Nova Scotia and Prince Edward Island were scheduled to meet U.S. governors for an hourlong session entitled Common Border, Common Ground at the winter meeting of the National Governors Association, an influential get-together that often influences policy for both the White House and Congress. The premiers aren’t exactly on the same page on environmental issues. Charest has criticized Ottawa for insisting that Canadian greenhouse gas policy must be in lockstep with the Americans, while Wall and other oil-producing provinces are in agreement with the feds that the U.S. and Canada must be in synch.

With the threat of an LCFS being adopted in a host of states and regions throughout the U.S., including the Mid-West, the Northeast and the Mid-Atlantic, policymakers must engage in a strong dialogue about the critical role that Canada continues to play in ensuring that energy prices remain stable and affordable for consumers, families, seniors and small businesses – especially during this time of generational economic downturn.

Hopefully, and for the sake of struggling consumers across the nation who cannot afford higher prices at the pump, this week’s meeting in Washington will shed like on and underscore the dangerous economic and security realities associated with an LCFS.

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CEA Comes Out Swinging in Debate Over Secure, Canadian Energy

Tuesday, February 16th, 2010

Last week, Whole Foods Market Inc. and Bed, Bath and Beyond Inc. announced plans to eliminate Canadian oil sands from its supply chain companies — in partnership with the environmental pressure group ForestEthics. The Globe and Mail reports that this action by Whole Foods is “part of its ecostrategy to cut energy costs, appeal to its environmentally aware customers, and raise the pressure on oil companies operating in northern Alberta to find cleaner ways of producing fuel.”

However, the Toronto Star reports on the reality of Whole Foods’ commitment:

The policy change is more easily said than done, given the complexities of the fuel supply chain. Whole Foods officials told the Toronto Star the company will continue to use fuels derived from Alberta tar sands “in the Rocky Mountain region because as of now there is no alternative source.

According to 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 structure – given that more than 50 percent of petroleum supplies available in these states come from Canada.

On the heels of this announcement, Michael Whatley, vice-president of Consumer Energy Alliance and a leading American expert on the oil-sands, released this 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.”

“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.”

Don Martin with the National Post captured the relevance of this announcement in regards to Low-Carbon Fuel Standard (LCFS) in the U.S. through his article “Alberta’s economy doesn’t fit Whole Foods ‘values,’ ” where he writes:

Now, this is not going to raise any risk to oilsand exports bound for a nation with an insatiable thirst for fossil fuels, particularly with new pipelines snaking south from northern Alberta to underutilized American refineries. South of the border, a dozen states are in the process of drafting bitumen blockades called LCFSs, low-carbon fuel standards which Gary Mar, Alberta’s man in Washington, says actually means ‘Less Competition for Saudi’ if they block the Fort McMurray motherlode.

As this announcement was made, the Wisconsin state senate conducted a hearing on Governor Doyle’s climate change legislation, where two key committee members spoke out against the inclusion of an LCFS provision in the bill. According to Wisconsin Public Radio (WPR), both Senators Jeff Plale of South Milwaukee and Bob Jauch of Poplar say they’re concerned about how an LCFS would determine what kind of oil gets used in Wisconsin.

The WPR segment reports the following:

Sen. Plale says that bothers him because it would mean the state would have to buy more oil from places like Venezuela and Saudi Arabia. And he says it would cost his district jobs. If the state goes with oil sands, the $40 million shovels that help process the sand are built in his district at either Bucyrus or Harnischfeger.

Sen. Jauch’s concerns are also local. His district includes Murphy Oil, which refines and sells the crude it buys from across the border in Canada. Jauch told members of Gov. Jim Doyle’s administration that they need to drop this plan to focus on the rest of the renewable energy bill.

Senators Jauch and Plale have been paying attention to their constituents and listening to small businesses across Wisconsin, such as the Wisconsin Manufacturers and Commerce, who recently wrote a column on the negative consequences of an LCFS.

While the fight in Wisconsin is far from over, it is clear that the threat of an LCFS still exists in the Badger State, as well as in many other states and regions, including the Mid-West, the Northeast and the Mid-Atlantic. Hopefully more state and national policymakers will take notice of Wisconsin’s debate and follow Sens. Jauch and Plale’s lead by exposing the dangerous reality of adopting LCFS proposals.

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

Thursday, February 11th, 2010

WASHINGTON, D.C. – 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,” Whatle concluded.

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