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New Keystone XL study falls flat

Although a new report from a Swedish group called the Stockholm Environment Institute has gained a lot of attention from the anti-energy crowd, unbiased analysts dismiss its claim that Keystone XL could result in carbon emissions four times greater than U.S. State Department estimates.

Here’s part of what Forbes had to say in their article, Recycled Keystone XL Report Doesn’t Add Up:

Professor Andrew Leach penned an insightful article earlier this week titled, “A paper on Keystone’s Climate Impacts Would Fail Econ 101.”, calling out the economic miscalculations of the report. Professor Leach argues the recycled report based its findings on faulty assumptions, resulting in a report riddled with fallacies.

It is difficult to imagine how SEI’s report passes muster.  In fact, the federal government has now authored five different studies on the subject. The reports support the claim the project will not adversely affect the environment. The KXL fight has been a “Green Herring” for years, lasting longer than American involvement in WWII.

Canadian oil is finding, and will continue to find its way to market.  In saying this, every credible report reaches the same conclusion, bringing the oil to market via pipeline will remain the safest, greenest, and most efficient way to transport crude to market.

We can probably expect more attempts to discredit Keystone XL, as long as the Obama Administration continues to delay approving construction of this worthwhile project that is supported by over three-quarters of the American public.

Keystone XL is a crucial link in a long-range plan that could support 500,000 U.S. jobs and give us access to twice as much North American oil as we now import from the Middle East.  It is a mystery to most of us why it is taking the Administration so long to make a decision.

GAO confirms that Renewable Fuel Standard costs outweigh benefits

The General Accounting Office (GAO) has released a new report on the way the Environmental Protection Agency (EPA) has determined the cost and benefits of several of their regulations.  It concludes that the costs of the Renewable Fuel Standard (RFS) are far greater than the benefits it returns to taxpayers.

Here’s how Taxpayers for Common Sense summed up the GAO’s findings:

  • RFS costs outweigh its benefits:  “EPA estimated net benefits of the [RFS] ranging from $13 to $26 billion. The measure does not include the costs of investments needed to increase renewable fuel production. The agency estimated those capital costs to total $90.5 billion through 2022.” So, the net costs of the RFS, as calculated in 2010, range from $64.5 to $77.5 billion.
  • Water quality costs:  “EPA quantified some adverse water quality effects of the RFS but did not monetize these effects.”
  • Discount rate:  “EPA did not clearly present its discounted estimates of benefits and costs using both rates [required by OMB], making it difficult to discern whether the agency used a consistent rate in the calculation.”
  • Relevance of the regulatory analysis:  Unlike other regulations requiring RIAs, “EPA officials said the [RFS RIA] played no role in selecting a regulatory approach because the approach resulted from a congressional mandate included in the Energy Independence and Security Act of 2007.” In other words, the huge time and effort spent calculating the costs and benefits of the RFS had no impact on EPA’s final decisions in implementing the federal mandate.
  • Problem statement:  EPA explained “the need for the proposed rule…but did not describe the problem the rule intended to address.”
  • Consideration of alternatives:  “EPA presented information for only the selected option,” but no alternatives.

Taxpayers for Common Sense went on to point out that, on top of the faulty cost/benefit analysis, the RFS enjoys federal subsidies and special interest tax breaks.  All in all, as Energy Citizens has long said, the Renewable Fuel Standard is no bargain.

Crude oil exports could mean big things for U.S. economy

Although the Obama Administration did conclude that two companies can export a lightly distilled type of ultra-light oil called condensate, despite the 39-year old ban on U.S. exports of crude oil, the full economic potential of crude oil exports remains out of reach.  Experts have predicted that large-scale exports of even the now-sanctioned condensate will not materialize.

That’s too bad, because allowing American oil producers – who are rapidly approaching the point where their output is likely to outpace the capacity of domestic refiners – would give the U.S. economy a tremendous shot in the arm.

As FuelFix reported in May, a study conducted by IHS found that lifting the export ban would:

  • Trigger $746 billion in investment from 2016 to 2030, causing domestic oil production to climb 1.2 million barrels per day more than if the trade restrictions remained intact.
  • Lower gasoline prices by 8 cents per gallon on average, as U.S. crude hits the world market and adds to supplies used by refiners around the globe.
  • Support an additional 394,000 direct and indirect jobs per year on average through 2030, as a result of the increased economic activity tied to the rise in crude production.

Another analysis of crude oil exports, by ICF International and EnSys Energy, predicted that the abolishment of current restrictions could increase domestic oil production by half a million barrels a day and reduce the U.S. trade deficit by $22 billion in 2020.

Energy Citizens urges the administration and Congress to approve more exports of domestic crude oil.  The benefits we stand to gain are clearly too good to ignore.

US Energy Exports Will Help Our Allies

The increase in U.S. oil and natural gas production is creating jobs throughout the country. It’s growing our economy and leading to a resurgence in American manufacturing. But it can do even more if we change outdated export policies and fully embrace the shale gas revolution. The American-made energy boom is having a global affect.

The Christian Science Monitor reported  on how the  domestic energy renaissance is changing  the geopolitical landscape:

“Russia supplies more than a quarter of the gas Europe consumes, and a little less than half of that gas travels through Ukraine. Last month, Russia shut off Ukraine's gas supply after the Eastern European country failed to pay back billions it owes in gas debt to Russia's state-owned gas giant Gazprom.

 “It's why Europeans are more eager than ever to trade energy with the US – a stable, reliable ally that became the world's top natural gas producer in 2010 and which currently rivals Saudi Arabia for biggest oil producer.”

Check out the whole article to see how the world will benefit from speeding up the natural gas export process and lifting the crude oil export ban. Let’s not squander this golden opportunity enhance our own national security and help our allies around the world. 

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