In second installment of this book review, Ted Auch, PhD, reviews chapters 4-8 of Public Responses to Fossil Fuel Export. Published in January 2022, this work explores the social dimensions of the global fossil fuel export system, with a focus on public perceptions and responses to new infrastructures.
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In this book review, Ted Auch, PhD, reviews the first three chapters of Public Responses to Fossil Fuel Export. Published in January 2022, this work explores the social dimensions of the global fossil fuel export system, with a focus on public perceptions and responses to new infrastructures.
This story map explores how the West’s failure to transition from fossil fuels to renewable energy is funding Russia’s invasion of Ukraine
FracTracker’s Erica Jackson outlines ten things she learned in Break Free From Plastic’s virtual Toxic Tours.
2019 Community Sentinel winner Melissa Troutman shares with FracTracker what she has been up to since winning the Sentinel award.
The Mi’kmaq First Nations people are facing threats to their lands and water due to plans in Nova Scotia proposed by AltaGas.
COVID-19 and the oil and gas industry are at odds. Air pollution created by oil and gas activities make people more vulnerable to viruses like COVID-19. Simultaneously, the economic impact of the pandemic is posing major challenges to oil and gas companies that were already struggling to meet their bottom line. In responding to these challenges, will our elected leaders agree on a stimulus package that prioritizes people over profits?
Health Impacts of COVID-19 and Oil & Gas
People living in areas with poor air quality may be more vulnerable to COVID-19, a disease that affects the lungs. Poor air quality is linked to higher rates of asthma and chronic obstructive pulmonary disease (COPD), even without a pandemic.
Air pollution from oil and gas development can come from compressor stations, condensate tanks, construction activity, dehydrators, engines, fugitive emissions, pits, vehicles, and venting and flaring. The impact is so severe that for every three job years created by fracking in the Marcellus Shale, one year of life is lost due to increased exposure to pollution.
Yes, air quality has improved in certain areas of China and elsewhere due to decreased traffic during the COVID-19 pandemic. But despite our eagerness for good news, sightings of dolphins in Italian waterways does not mean that mother earth has forgiven us or “hit the reset button.”
Significant environmental health concerns persist, despite some improvements in air quality. During the 2003 SARS outbreak, which was caused by another coronavirus, patients from areas with the high levels of air pollution were twice as likely to die from SARS compared to those who lived in places with little pollution.
On March 8th, Stanford University environmental resource economist Marshall Burke looked at the impacts of air quality improvements under COVID-19, and offered this important caveat:
“It seems clearly incorrect and foolhardy to conclude that pandemics are good for health. Again I emphasize that the effects calculated above are just the health benefits of the air pollution changes, and do not account for the many other short- or long-term negative consequences of social and economic disruption on health or other outcomes; these harms could exceed any health benefits from reduced air pollution. But the calculation is perhaps a useful reminder of the often-hidden health consequences of the status quo, i.e. the substantial costs that our current way of doing things exacts on our health and livelihoods.”
This is an environmental justice issue. Higher levels of air pollution tend to be in communities with more poverty, people of color, and immigrants. Other health impacts related to oil and gas activities, from cancer to negative birth outcomes, compromise people’s health, making them more vulnerable to COVID-19. Plus, marginalized communities experience disproportionate barriers to healthcare as well as a heavier economic toll during city-wide lockdowns.
Financial Instability of the Oil & Gas Industry in the Face of COVID-19
The COVID-19 health crisis is setting off major changes in the oil and gas industry. The situation may thwart plans for additional petrochemical expansion and cause investors to turn away from fracking for good.
Persistent Negative Returns
Oil, gas, and petrochemical producers were facing financial uncertainties even before COVID-19 began to spread internationally. Now, the economics have never been worse.
In 2019, shale-focused oil and gas producers ended the year with net losses of $6.7 billion. This capped off the decade of the “shale revolution,” during which oil and gas companies spent $189 billion more on drilling and other capital expenses than they brought in through sales. This negative cash flow is a huge red flag for investors.
“North America’s shale industry has never succeeded in producing positive free cash flows for any full year since the practice of fracking became widespread.” IEEFA
Shale companies in the United States produce more natural gas than they can sell, to the extent that they frequently resort to burning gas straight into the atmosphere. This oversupply drives down prices, a phenomenon that industry refers to as a “price glut.”
The oil-price war between Russia and Saudi Arabia has been taking a toll on oil and gas prices as well. Saudi Arabia plans to increase oil production by 2 – 3 million barrels per day in April, bringing the global total to 102 million barrels produced per day. But with the global COVID-19 lockdown, transportation has decreased considerably, and the world may only need 90 million barrels per day.
If you’ve taken Econ 101, you know that when production increases as demand decreases, prices plummet. Some analysts estimate that the price of oil will soon fall to as low as $5 per barrel, (compared to the OPEC+ intended price of $60 per barrel).
Corporate welfare vs. public health and safety
Oil and gas industry lobbyists have asked Congress for financial support in response to COVID-19. Two stimulus bills in both the House and Senate are currently competing for aid.
Speaker McConnell’s bill seeks to provide corporate welfare with a $415 billion fund. This would largely benefit industries like oil and gas, airlines, and cruise ships. Friends of the Earth gauged the potential bailout to the fracking industry at $26.287 billion. In another approach, the GOP Senate is seeking to raise oil prices by directly purchasing for the Strategic Petroleum Reserve, the nation’s emergency oil supply.
Speaker Pelosi’s proposed stimulus bill includes $250 billion in emergency funding with stricter conditions on corporate use, but doesn’t contain strong enough language to prevent a massive bailout to oil and gas companies.
Hopefully with public pressure, Democrats will take a firmer stance and push for economic stimulus to be directed to healthcare, paid sick leave, stronger unemployment insurance, free COVID-19 testing, and food security.
Grasping at straws
Fracking companies were struggling to stay afloat before COVID-19 even with generous government subsidies. It’s becoming very clear that the fracking boom is finally busting. In an attempt to make use of the oversupply of gas and win back investors, the petrochemical industry is expanding rapidly. There are currently plans for $164 billion of new infrastructure in the United States that would turn fracked natural gas into plastic.
There are several fundamental flaws with this plan. One is that the price of plastic is falling. A new report by the Institute for Energy Economics and Financial Analysis (IEEFA) states that the price of plastic today is 40% lower than industry projections in 2010-2013. This is around the time that plans started for a $5.7 billion petrochemical complex in Belmont County, Ohio. This would be the second major infrastructural addition to the planned petrochemical buildout in the Ohio River Valley, the first being the multi-billion dollar ethane cracker plant in Beaver County, Pennsylvania.
Secondly, there is more national and global competition than anticipated, both in supply and production. Natural gas and petrochemical companies have invested in infrastructure in an attempt to take advantage of cheap natural gas, creating an oversupply of plastic, again decreasing prices and revenue. Plus, governments around the world are banning single-use plastics, and McKinsey & Company estimates that up to 60% of plastic production could be based on reuse and recycling by 2050.
Sharp declines in feedstock prices do not lead to rising demand for petrochemical end products.
Third, oil and gas companies were overly optimistic in their projections of national economic growth. The IMF recently projected that GDP growth will slow down in China and the United States in the coming years. And this was before the historic drop in oil prices and the COVID-19 outbreak.
“The risks are becoming insurmountable. The price of plastics is sinking and the market is already oversupplied due to industry overbuilding and increased competition,” said Tom Sanzillo, IEEFA’s director of finance and author of the report.
The Show’s Over for Oil & Gas
Oil, gas, and petrochemical companies are facing perilous prospects from demand and supply sides. Increasing supply does not match up with decreasing demand, and as a result the price of oil and plastics are dropping quickly. Tens of thousands of oil and gas workers are being fired, and more than 200 oil and gas companies have filed for bankruptcy in North America in the past five years. Investors are no longer interested in propping up failing companies.
Natural gas accounts for 44% of electricity generation in the United States – more than any other source. Despite that, the cost per megawatt hour of electricity for renewable energy power plants is now cheaper than that of natural gas power plants. At this point, the economy is bound to move towards cleaner and more economically sustainable energy solutions.
It’s not always necessary or appropriate to find a “silver lining” in crises, and it’s wrong to celebrate reduced pollution or renewable energy achievements that come as the direct result of illness and death. Everyone’s first priority must be their health and the health of their community. Yet the pandemic has exposed fundamental flaws in our energy system, and given elected leaders a moment to pause and consider how we should move forward.
It is a pivotal moment in terms of global energy production. With determination, the United States can exercise the political willpower to prioritize people over profits– in this case, public health over fossil fuel companies.
Top photo of petrochemical activity in the Houston, Texas area. By Ted Auch, FracTracker Alliance. Aerial assistance provided by LightHawk.
By Isabelle Weber, FracTracker Alliance Spring 2019 Intern
Feature photo of oil and gas drilling in North Dakota, and is by by Nick Lund, NPCA, 2014
Although there are some federal regulations in place to protect the environment indirectly from fracking in the United States, the regulations that try to keep fracking in check are largely implemented at the state governing level. This has led to a patchwork of regulations that differ in strictness from state to state. This leads to the concern that there will be a race to the bottom where states lower the strictness of their regulations in order to draw in more fracking. While it might be tempting to welcome an industry that often creates a temporary economic spike, the costs of mitigating the environmental damage from fracking far out-weighs the profit gained. Germany, Scotland, and France are examples of countries that have taken more appropriate regulatory measures to protect their populations from the risks involved in unconventional oil and gas development.
The Shortfalls of State by State Regulations
For a detailed overview of how fracking regulation differs between states, check out the Resources for the Future report, The State of State Shale Gas Regulation, which analyzes 25 regulatory elements and how they differ between states. Two of their maps that attest to this vast difference in regulation are the “Fracturing Fluid Disclosure Requirements” map as well as the “Venting Regulations” map.
The “Fracturing Fluid Disclosure Requirements” map shows regulatory differences between states regarding whether or not the chemical mixture used to break up rock formations must be made known to the public. “Disclosure” means that the chemical mixture is made known to the public and “No Regulation” means that there is nothing that obligates companies to share this information, which usually implies this information is not available.
Note from the editor: There are several exemptions that allow states to limit the scope of reporting chemicals used in underground fluid injection for fracking. For example, all states that require chemical disclosure are entitled to exemptions for chemicals that are considered trade secrets.
Concealing the identity of chemicals increases the risk of harm from chemical exposure for people and the environment. Emergency first responders are especially at risk, as they may have to act quickly to put out a fracking-induced fire without knowing the safety measures necessary to avoid exposure to dangerous chemicals. The population at large is at risk of exposure though several pathways such as leaks, spills, and air emissions. Partnership for Policy Integrity, along with data analysis by FracTracker, investigated the implications of keeping the identity of certain fracking chemicals secret in two states, Ohio and Pennsylvania. These reports point to evidence that exposure to concealed fracking chemicals could have serious health effects including blood toxicity, developmental toxicity, liver toxicity and neurotoxicity.
The second map, “Venting Regulations,” shows which states have regulations that limit or ban venting and which do not. Venting is the direct release of methane from the well site into the atmosphere. Methane has 30 times the green-house gas effect as carbon dioxide. Given methane’s severe impact on the environment, no venting whatsoever should be allowed at well sites.
Having overarching federal regulatory infrastructure to regulate fracking would help to avoid risks such as toxic chemical exposure and accelerated climate change. Although leaving regulation development to states allows for more specialized laws, there are certain aspects of environmental protection that apply to every area in the United States and are necessary as standard protection against the effects of fracking.
How do other countries regulate fracking?
Stronger federal regulation of fracking has worked well in the past and can be seen in several other countries.
In 2017, Germany passed new legislation that largely banned unconventional hydraulic fracking. The ban on unconventional fracking excludes four experimental wells per state that will be commissioned by the German government to an independent expert commission to identify knowledge gaps and risks with regards to fracking. Conventional fracking also received tighter regulations including a ban on fracking near drinking water sources. In 2021, the ban will be reevaluated, taking into account research results, public perception, long term damage to residents and the environment, and technological advances. This is a perfect example of how a country can use overarching federal regulation to make informed decisions about industry action.
In 2015, Scotland placed a moratorium into effect that halted all fracking in the country. Since 2017, the government has held that the moratorium will stand indefinitely as an effective ban on fracking in the country, but the country is still working on the legislature that will officially ban fracking. Meanwhile, the Scottish government conducted one of the most far-reaching investigations into unconventional oil and gas development, which included a four-month public consultation period. This public consultation garnered 65,000 responses, 65% of which were from former coal mining communities targeted by the fracking industry. Of those responses, 99% of responses opposed fracking.
The Scottish people should be applauded for holding their federal government accountable in fulfilling its responsibility to protect its people and its environment against the effects of fracking.
In December 2017, France passed a law that bans exploration and production of all oil and natural gas by the year 2040. This applies to mainland France as well as all French territories. Although France has limited natural gas resources, it is hoped that the ban will be contagious and spread to other countries. This is a prime example of a country making a decision to protect their environment through regulation.
Although France’s banning of fracking was largely symbolic and may not result in a considerable reduction of greenhouse gases related to natural gas exploration, the country is sending a message to the world that we need to facilitate the end of the fossil fuel era and a move toward renewables.
Back to the US, the world’s leading producer of natural gas
Federal regulation on fracking should be holding the oil and gas industry in check by requiring states to meet basic measures to protect people and the environment. States could then develop more stringent regulations as they see fit. It is important that we come to a national consensus on the environmental and health hazards of fracking, and consequently, to adopt appropriate federal regulations.
By Isabelle Weber, FracTracker Alliance Spring 2019 Intern
California has become a battleground for real climate action. The state Governor, Jerry Brown prides himself in his own climate leadership, and California has pushed EU nations and countries worldwide to take climate change seriously. As a final tribute to his own tenure as a term-limited governor, Brown has organized and hosted a Global Climate Action Summit, September 12-14th. The summit convenes an international invitation list of “climate leaders” to, in their words:
“Take Ambition to the Next Level.” It will be a moment to celebrate the extraordinary achievements of states, regions, cities, companies, investors and citizens with respect to climate action. It will also be a launchpad for deeper worldwide commitments and accelerated action from countries—supported by all sectors of society—that can put the globe on track to prevent dangerous climate change and realize the historic Paris Agreement.
Meanwhile, frontline communities, community organizers, and grassroots organizations contest the perspective that real change has been made. While investors and green capitalists celebrate, frontline communities fight daily for clean air and water. In solidarity with and led by frontline communities, activists have protested the summit, in an attempt to hold policy makers accountable to those most affected by the fossil fuel industry.
Rise for Climate, Jobs, and Justice
One quarter of a million people worldwide, and well over 30,000 in San Francisco hit the streets during the Rise for Climate last Saturday, September 8th. With over 900 actions taking place simultaneously people worldwide demanded real climate action from their local leaders. FracTracker Alliance staff helped coordinate and participated in events nationwide.
In San Francisco, the march was led by members of the Indigenous community, making up the Indigenous Bloc, on the frontlines of the action. The day officially started with prayers from Indigenous leaders and a moment of silence for Indigenous Peoples that have been most harmed by the effects of climate change. Dozens of various other movements followed the Indigenous Bloc in a parade of support. FracTracker took the opportunity to document this monumental event, and photos from the march are shown below.
For California and international “climate leaders” in attendance, Rise kicked off a long week of climate action culminating with the Global Action Climate Summit. The week is full of activities geared towards movement building, including the Solidarity to Solutions Summit (#sol2sol) by It Takes Roots; Women’s Assembly for Climate Justice, hosted by Women’s Earth and Climate Action Network; and mass actions including a march and occupation of the Global Climate Action Summit!
To mark such a momentous movement, the Brown administration signed a new bill into law, SB100. The new law, authored by Kevin De León (D-Los Angeles), pledges that all of California’s electricity will come from clean power sources by 2045. Brown said, “California is committed to doing whatever is necessary to meet the existential threat of climate change.” This is the most ambitious state climate policy in the U.S. The legislation barely passed the state Legislature after nearly two years of debate, with opponents arguing that it would lead to higher electric bills for all Californians.
Opposition from Eco-Activists
In opposition to the feel-good, pat-yourself-on-the-back feelings from delegates at the summit, frontline communities and activists respond that the SB100 legislation does nothing to stop harms to frontline communities caused by extraction and the supply side of the fossil fuel economy. The Against Climate Capitalism campaign is a coalition of Diablo Rising Tide teamed up with Idle No More SF Bay, the Ruckus Society, It Takes Roots, Indigenous Environmental Network and the Brown’s Last Chance. Members of the coalition have been outspoken proponents organizing in support of real climate leadership. The coalition is pushing for Governor Jerry Brown and the California legislature to end the extraction of new fossil fuels in California. The green groups making up these larger coalition networks encompass a broad range research and advocacy groups, from international groups like Greenpeace to local grassroots movements from Los Angeles and California’s Central Valley. FracTracker Alliance is also a campaign member.
The goal of the campaign is to keep fossil fuels in the ground, and supports a just transition from a fossil fuel economy to clean energy sources. A petition to pressure California Governor Jerry Brown to end fossil fuel extraction can be found on their website. The California legislature and the Brown administration has consistently failed to address the impacts of extraction in its own backyard. While frontline communities are suffering, the Brown administration continues to take the easy way out with future legislation such as SB100, which does nothing to address the environmental justice spector of actual oil drilling and production. In response to SB100, the campaign has issued response:
- Governor Brown has consistently failed to address the supply side of oil and the drilling in California, which is an indispensable step to avoid the worst effects of climate destruction.
- Some 5.4 million Californians live within a mile of at least one oil or gas well, and this includes hundreds of thousands of children. Many suffer illnesses from toxic exposure and cannot wait for action.
- Brown’s failure to act on this issue is a massive moral failure from which no bill signing can distract. Despite his signing of an important and historical bill he did nothing to draft or support, Governor Brown can expect to be greeted with energetic and committed protest at the Global Climate Action summit this week.
With these poignant criticisms, it begs the question; how can Governor Jerry Brown continue to ignore the actual cause of climate change? Brown has passed legislation ensuring that everyday Californians will bear the costs for clean energy utilities, but has done nothing to hold accountable the actual culprits responsible for climate change, the oil and gas corporations extracting the 5.7 million barrels of oil per year from California soil.
By Kyle Ferrar, Western Program Coordinator
Cover photo: Brown’s Las Change Billboard. Photo by Liz Hafalia, The Chronicle