Leading Light Energy

an energy blog by Terry M. Jarrett

PowerLine: Global Temperatures: What is Really Happening?

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John Hinderaker over at PowerLine has a good handle on the global warming issue. Today, his post discusses whether the earth’s temperature is really warming (spoiler alert: no).

Liberals wax hysterical about global warming, mostly because it provides an opportunity for graft: politically connected businessmen make billions by manufacturing and selling wind and solar products that exist only because of government mandates and subsidies. These corrupt businessmen, in turn, donate many millions to the campaigns of politicians who vote for mandates and subsidies, who are mostly (but not entirely) Democrats. Meanwhile, the rest of us–those who consume electricity–pay through the nose to subsidize left-wing causes.

Does this make sense? There are many reasons why the answer is No, but let’s start at the beginning: is the Earth actually warming according to the predictions of the warmists’ models? No, it isn’t.

The surface temperature record is so corrupt as to be useless. Most of the temperatures that go into the surface database are not even recorded–they are interpolated based on temperatures at other sites. And the records have systematically been “adjusted” to make temperatures from earlier decades, like the 1930s, lower, and today’s temperatures higher. This is all done for financial and political purposes. Many billions of dollars flow into the bank accounts of scientists who are willing to “adjust” according to the political winds.

There is only one reliable, publicly available and publicly vetted temperature data set. It is maintained by the University of Alabama at Huntsville, the National Oceanic and Atmospheric Administration, the National Aeronautics and Space Administration, Dr. John Christy and Dr. Roy Spencer. These satellite data track temperatures where it matters–in the atmosphere, where global warming is alleged to occur. They show that the steep temperature increases predicted by the alarmists’ models are not occurring.

Temperatures were below the baseline until the late 1990s, and since then have been up and down, but mostly slightly above average–a high of a little over .8 of a degree, most recently around 0.2 degree. Temperatures have been going up and down, often by much larger amounts, for millions of years. The salient point here is that the Earth’s temperatures, as most reliably measured, are not rising consistent with the doomsday predictions of the liberals’ models. Here are the data in graphic form. Click to enlarge:

So the models, and therefore the catastrophic anthropogenic global warming theory, are wrong.

As usual, John hits a home run.

Google will power two data centers with solar projects totaling 413 MW in Alabama and Tennessee

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The Chattanooga Times Free Press is reporting that Google will power two data centers with solar projects totaling 413 MW in Alabama and Tennessee.

Data centers use an incredible amount of power, and companies like Google are using solar energy for some of their energy needs. But not all. The story notes that the Tennessee Valley Authority (TVA) will own the solar facilities, and will be supplying the power to the data centers. When the sun is shining and the solar facilities are generating electricity, it is conceivable that they could supply 100% of the power to Google during those times.

However, when it is cloudy, or when it is nighttime, solar panels don’t generate electricity. At those times, TVA will need other sources of energy to supply the data centers with the power they need. What kind of power will it be? Today, TVA’s generation portfolio is 37% nuclear, 24% coal, 20% natural gas, 9% hydro, 3% wind + solar and 7% energy efficiency with a total capacity of 169,000 gigawatt-hours. So, the idea that solar energy will supply 100% of the data centers’ needs is not 100% true.

 

In the News Today….1.17.19

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In the news today…

EPA:

  • POLITICO Pro reports a federal court Wednesday said it will not extend a Friday deadline for EPA to file a key brief in a mining-related lawsuit because of the ongoing government shutdown. The denial is at least the second time a court has rejected EPA’s request for delay until the shutdown is over, after a different court on Monday told EPA it could not have more time in an unrelated case on coal ash permitting.
  • E&E News PM reports at his Senate confirmation hearing Wednesday, acting EPA Administrator Wheeler downplayed the potential impact of a plan to strike the legal underpinning for the Obama-era limits on emissions of mercury, arsenic and other toxic pollutants from coal- and oil-fired power plants.
  • The Daily Herald reports Democrats pressed Wheeler about his work as a lobbyist helping an influential coal magnate meet with Trump administration officials before his nomination to the EPA and his moves on deregulation and on what they said was his inattention to the growing dangers of climate change.
  • Argus reports the EPA’s proposed plan for reducing CO2 emissions would extend the life of a handful of coal-fired power plants that otherwise are in danger of closing in coming years, according to a study published in the journal Environmental Research Letters.

Emissions:

  • E&E Climatewire reports everything that uses fossil fuels, like power plants, cars, aircraft, ships and industrial infrastructure, would need to be replaced with zero-carbon alternatives at the end of its life span, says a study published yesterday in the journal Nature Communications.
  • The Wall Street Journal carries an op-ed from a group of economists, in which they argue for taxing carbon emissions, nixing other regulations and returning the tax revenue to consumers with recurring dividend checks.

Coal:

  • Argus reports coal-fired generation in the PJM Interconnection and Midcontinent Independent System Operator (MISO) rose to the highest level in nearly a month this past week, as a snow storm blanketed the region.

In The News Today….1.16.19

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In the news today…

 

EPA:

  • E&E Greenwire reports more than two weeks after acting EPA Administrator Wheeler signed a proposal that would revoke the legal underpinning for 2012 regulations on power plant mercury emissions, Federal Register publication of the draft rule “has been delayed due to the lapse in appropriations,” an attorney for EPA said in the status report filed with the U.S. Court of Appeals for the District of Columbia Circuit.
  • The Hill reports acting EPA Administrator Wheeler is set to face questions from senators at his confirmation hearing this morning. Wheeler, who has overseen EPA regulatory actions such as the proposal of new fuel economy standards and a proposed Clean Power Plan replacement, is likely to face questions about those and other rulemakings.

Coal:

  • E&E Greenwire reports federal judges were deeply skeptical Tuesday of coal executive Bob Murray’s refusal to read a statement to his miners admitting he interfered with their rights to anonymously report safety hazards. The U.S. Court of Appeals for the District of Columbia Circuit heard oral arguments in Murray’s challenge to an administrative law judge’s ruling against his companies and the prescribed punishment.
  • S&P Global Platts reports the DOE said Tuesday it has made $9.5 million available to create new market opportunities for coal through research into making upgraded coal fuel, producing high-value solid products from coal and other advanced material research.
  • Axios reports EPA’s plan to regulate carbon dioxide from coal-fired power plants would lead to CO2 emissions increases as high as 9% in 18 states in 2030, despite driving a modest nationwide cut, a new paper in the journal Environmental Research Letters concludes.
  • The Washington Post reports while Trump administration officials trumpet a potential coal boom at the Grand Staircase-Escalante National Monument, it’s unclear whether there will be many takers. Several of the tourist operators, conservation groups and researchers who invested in the area over the past two decades fear that even a modest amount of mining will undermine the landscape’s main attractions.

Is Natural Gas the Only Answer for our Energy Needs?

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An interesting piece appears in Real Clear Energy today. In the piece, Guy F. Caruso, former head of the U.S. Energy Information Administration, writes  about 3 principles should guide the new FERC appointee (for more information on the vacancy, read here).

The piece is decidedly pro-natural gas, and while I agree that natural gas is an important piece in our energy puzzle, I do have some issues with his conclusions.

Now, let’s address his 3 points. First, Mr. Caruso says that FERC should not pick winners and losers in the energy market, and that a new appointee should oppose any initiative to compensate coal and nuclear power plants for providing grid resilience. Coal and nuclear plants have fuel stored at the plant sites, and thus are not subject to transportation issues. This is a big advantage for providing grid reliability. One of the drawbacks for using natural gas for generating electricity is that there is very little gas storage on site, so the plants are reliant on receiving a steady supply from pipelines. The trouble is, gas plants are not always able to get the natural gas they need to generate electricity, especially in the winter. Gas plants compete with homeowners for the fuel, which homeowners use to heat their homes. And, when the temperature is really cold, not as much gas can move through the pipelines.  Gas prices can spike when it gets really cold (see Polar Vortex Exposes Natural Gas Supply Problem).

Second, he says that the U.S. must fully recognize the value of natural gas. By that, he means coal and nuclear plants should be closed down and more gas plants should be built. He also advocates for building more gas pipelines. At this point in his article, he chides me for my “criticism” of natural gas:

This should call into question views recently expressed by former Missouri utility regulator Terry Jarrett, who argues that fuel constraints and price spikes should make us skeptical about natural gas. Instead of propping up coal, as Jarrett suggests, the better approach is to invest in  natural gas pipelines.

The problem is, there is lots of opposition to building new pipelines. In “Gas Pipeline Plans Face Stiff Opposition,” The Hartford Courant highlights the sometimes stiff opposition to new pipelines in New England, where natural gas is the major producer of electricity. New natural gas power plants won’t work very well if there aren’t enough pipelines to support them.

Third, he advocates for increased exporting of natural gas. I’m all for that.

I don’t consider it criticism when I point out some of the disadvantages of relying too heavily on natural gas to produce electricity. All of the sources we use today–coal, nuclear, natural gas, hydro, renewables–have their pros and cons, and we shouldn’t rely too heavily on any one of them as the exclusive solution to our energy needs.

All in all, Mr. Caruso has written a very thoughtful piece. I agree with a lot of what he says. We need natural gas, but I just don’t believe that it can shoulder the entire burden of producing our electricity reliably and affordably.

 

 

As California Burned, State Politicos Headed to Hawaii with Utility Executives

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One of my favorite blogs, Legal Insurrection, carries a piece today entitled “As California burned, state politicos headed to Hawaii with utility executives.” They report that during the wildfires that burned in California last year, several state lawmakers were in Hawaii with utility executives from Pacific Gas and Electric (PG&E).  The utility is being blamed for last year’s deadly Camp Fire, the deadliest and most destructive wildfire in California’s history. As a result, several PG&E executives, including its CEO, have resigned:

Geisha Williams had been chief executive of Pacific Gas and Electric Co., or PG&E, since March 2017, when she became the first Latina chief executive of a Fortune 500 company. John Simon, the utility’s executive vice president and general counsel, will serve as interim chief executive while PG&E searches for a permanent leader, the company said.

PG&E is in crisis after the Camp Fire killed at least 85 people in Northern California last year. California Attorney General Xavier Becerra told a federal judge last month that the company could be prosecuted for murder.

Furthermore, the utility intends to file for bankruptcy by the end of January due to the potential liability.

The woes continue for PG&E.

 

A warming world needs nuclear power

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Bloomberg carries an opinion piece which highlights the need for nuclear power:

Nuclear accounts for almost 60 percent of emissions-free power in the U.S., and when plants shut down, utilities mostly turn to fossil fuels to fill the void. More than one-third of the country’s plants, representing 22 percent of total nuclear capacity, are either scheduled to close or at risk of closure within the next five to 10 years, said a new UCS study. This could lead to a 4 percent to 6 percent increase in carbon emissions from the power sector by 2035.

Nuclear power is expensive, and it’s under pressure from market forces – notably, the falling price of solar and wind power.

Then why not simply let it lose market share to those safe, clean fuels? Because wind and solar can’t immediately fill the gap. They still account for less than 8 percent of energy produced in the U.S. (nuclear is 20 percent). It’s crucial that their growth displaces coal and natural gas, not nuclear.

In principle, a carbon tax is the best way to keep nuclear power competitive.

As the voters of Washington state have again demonstrated, however, taxes on fuel remain prohibitively unpopular. (French President Emmanuel Macron has just made the same discovery.) Nonetheless, states can reward nuclear power’s climate advantage in other ways – by giving zero-emissions credits for nuclear power, as Illinois, New York and New Jersey have done, or by revising their energy portfolio standards to stop utilities’ switching from nuclear to fossil fuels.

If enough states take such measures, old plants could be kept running until the next generation of nuclear plants is ready. Building these might also require subsidy – for example, in the form of investment tax credits.

These and other options need to be on the table as the world wakes up to the role nuclear power must play in avoiding a climate catastrophe.

This highlights the need for an all of the above strategy for generating electricity. All fuel sources have pros and cons, but finding the right mix is essential for maintaining reliable and affordable energy.

 

In The News Today….1.15.19

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In the news today and from the weekend…

Coal:

  • The Hill carries an op-ed from Jason Hayes, director of environmental policy at the Mackinac Center for Public Policy. Hayes writes today’s coal industry is going to need wider use of new technologies, new markets, and a far better response to anti-coal messaging to begin rebuilding the American coal fleet.
  • POLITICO Pro reports a federal judge Monday said he will not grant EPA’s request to pause a lawsuit over the agency’s decision last year to give Oklahoma control over its coal ash permitting program.
  • Bloomberg reports electric cars are better for the environment than traditional gasoline models, and that benefit will grow as power generators shift away from coal.

Congress:

  • E&E Daily reports the House is set to vote this week on a series of bills related to energy policy, cybersecurity and federal agencies.
  • E&E Daily reports Sen. Elizabeth Warren signed the “No Fossil Fuel Money Pledge” over the weekend, and at least three other potential 2020 candidates — Washington Gov. Jay Inslee, Hawaii Rep. Tulsi Gabbard and Sen. Bernie Sanders — have also sworn off fossil fuel campaign dollars.

Electricity Generation and the Reliability Factor

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When I’m asked about the pros and cons of different sources of electricity generation, I often emphasize the importance of reliability. America’s daily baseload power needs are enormous, and when it comes to vital infrastructure such as water treatment, hospitals, and public transit, there’s little room for error when making sure that electricity keeps reaching where it’s needed, day in and day out.

 

A good way to look at this is the real-time data that’s publicly available for some of the nation’s largest utilities. For example, The Midcontinent Independent System Operator (MISO)—which oversees 200,000 megawatts of power-generation across 15 U.S. states—publishes a continuously updated chart of the ‘Fuel Mix’ for its overall power generation.

 

We can glean some interesting items from MISO’s fuel chart.

 

For starters, coal continues to be the dominant electricity producer for their mix—averaging about 55 percent of total power generation. Natural gas comes in second at around 17 percent, with nuclear third at about 16 percent.

 

The remainder of MISO’s energy portfolio comes from wind generation, plus a small sliver of miscellaneous sources.

 

What’s interesting are the fluctuations in the overall mix. For example, on Thursday, November 29—a cold day for much of the central United States—MISO’s fuel mix showed that wind generation remained at around 2 percent of total generation. This was unfortunate, since the weather was particularly cold—and families were turning up their thermostats to stay warm. But there simply wasn’t much wind blowing throughout most of the day.

 

By contrast, a few days later, on Monday, December 3, the weather was milder, and wind generation across MISO’s grid was averaging roughly 8 percent of total generation. That’s quite a difference from four days prior.

 

The point is, while wind generation has some positives in terms of being a “free” source of power, it also has drawbacks. When MISO’s wind capacity declined to 2 percent of total output on November 29, coal and natural gas plants needed to ramp up in order to cover the difference. This generally isn’t a problem, since MISO maintains a sturdy fleet of both coal and gas plants that can run continuously.

 

But it illustrates a wider point. Renewables are inherently unpredictable—since wind turbines depend on a steady flow of wind, and solar panels require ample, direct sunlight. When the wind isn’t blowing, or the sun isn’t shining, another source of electricity generation is required to make up the difference. and that’s where coal, natural gas, and nuclear plants fill in the gaps.

 

For these reasons, an “all of the above” energy strategy makes sense, simply to ensure that there are always available means to produce the on-demand electricity that Americans need in order to maintain healthy, safe daily living.

Are Utilities to Blame for the Spike in Carbon Emissions?

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According to a piece in E&E News, The limitations of America’s reliance on switching from coal to natural gas to lower emissions came into focus in 2018. Here’s the conundrum:

Power companies’ reliance on gas is a double-edged sword for climate hawks. When a natural gas plant replaces a coal facility, there is a climate benefit. Gas plants emit about half of what’s puffed into the air by their coal counterparts. EIA estimates that coal-to-gas switching is responsible for two-thirds of power-sector emissions reductions between 2005 and 2017. Renewables account for the remaining third.

But when gas plants run harder to meet an increase in electricity demand, emissions go up.

That’s what happened in 2018, when a combination of weather events and a hot economy prompted the first increase in electricity demand in years. Power-sector emissions rose 1.9 percent as a result, as gas plants ran more to satisfy robust demand for electricity.

The “expert” relied on to explain this seems to fault utilities for this “problem”:

“This isn’t the huge transition that is necessary to meet the climate challenge, and I do think utilities are a big part of it,” said Leah Stokes, a professor who studies power-sector and political trends at the University of California, Santa Barbara. “It’s easier to build a natural gas plant, fits with business as usual, and they can ramp it on and off.”

Blaming the utilities is misplaced for several reasons. This is because utilities all across the United States are adding more renewables, and have been doing so for the past several years. Renewables’ share of U.S. energy consumption has now doubled since 2008, as coal’s share crashed in the same period from 48% to 30%.

But a bigger reason that utilities are not to blame is because their main responsibility is to provide reliable and affordable energy to their customers. The best way to do that at the present time is to use the old reliables–coal, natural gas, and nuclear.

We would be far better served to have an “all of the above” strategy when it comes to energy. We need all sources of generating electricity to ensure the we receive the reliable and affordable energy we need to heat and cool our homes, and power our businesses and industries. That includes the continued use of fossil fuels.

 

We Need a Recession to slow Global Warming! Huh??

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Talk about a “good news, bad news” scenario–I have some good news, and I have some bad news! The good news is that the economy is booming! The bad news is that all this economic growth is causing more global warming!

In “Economic expansion boosts carbon emissions, despite green-tech gains,” NBC News frames the problem this way:

No matter that coal-fired power plants went out of business in record numbers, or that Americans nearly doubled their purchases of electric cars. The U.S. increased its carbon dioxide emissions in 2018, and a large part of the reason was one normally cited as a bonus — substantial economic growth.

A booming American economy meant increased industrial production, more truck and air travel and more offices and other workplaces to heat — all combining, along with other factors, to create the second-largest annual increase in the key greenhouse gas emissions in more than two decades, according to new estimates from the Rhodium Group.

 The result is that — despite expansion of solar and wind power and some movement to alternative-fuel vehicles — the U.S. will have to do even more in the coming years to come close to meeting previous international commitments for greenhouse gas reductions.

Whatever, oh whatever, shall we do? Don’t worry–NBC News has the solution!

Experts say it may take a recession to reduce the gases that are warming the planet.

Huh? What would we do without “experts”? I can think of a more accurate word to describe them: idiots.

Manhattan Contrarian: Will Somebody Actually Start A Serious “Climate” Emissions-Reduction Program In 2019?

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Since I am snowed in today, I’ve taken the opportunity to catch up on some of my favorite blogs, one of which is the Manhattan Contrarian.

Francis Menton, in his post “Will Somebody Actually Start A Serious “Climate” Emissions-Reduction Program In 2019?” writes that while the U.S. debates a “Green New Deal” to ban fossil fuels, one country (or continent) after another is giving up on so-called “renewables” and carbon taxes and even the whole idea of emissions reductions, and going instead for some good old reliable coal: China, India, Africa, Japan, Australia, even Canada and Germany. And that doesn’t include the new Energy Plan from Poland, presented at the close of 2018, which promises to scrap all wind turbines by 2035.

It is highly recommended reading. Good stuff, as always!

WSJ: Russian Hackers Infiltrated the U.S. Power Grid

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Russian cyber operatives have been busy probing U.S. power grid vulnerabilities, according to an extensive report by the WSJ.

The WSJ reports that hackers used several methods to infiltrate the grid, including planting malware on sites of online publications frequently read by utility engineers to gain access to their computers. Russian cyber operatives pretending to be job seekers sent out fake résumés with tainted attachments. Once they had computer-network credentials, they slipped through hidden portals used by utility technicians, in some cases getting into computer systems that monitor and control electricity flows.

Some experts believe two dozen or more utilities were breached.

The full WSJ article (behind paywall) can be accessed here.

Cyber Security risks to our electric grid are very real, and thanks to the WSJ for shining the light on the problem.

Woodward: Ocasio-Cortez’s ‘Green New Deal’ a joke?

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Good Saturday morning!

Here where I live in mid-Missouri, there is over a foot of snow on the ground. Global warming? Not much evidence of that here.

Meanwhile, Chris Woodward has quoted me in his excellent One News Now article which points out the problems with Rep. Alexandria Ocasio-Cortez’s green new deal proposal. Here’s the excerpt:

Former Missouri Public Service Commission and energy blogger Terry Jarrett is highly skeptical of the plan.

“I would say it’s downright impossible,” argued Jarrett, who is also an attorney. “To be able to completely do away with fossil fuels in the next 12 years – what that would mean for the economy and our way of life would … just be devastating.”

He explained his reasoning further.

“To basically shut down all coal plants, all natural gas plants, do away with oil and gasoline – we’re talking trillions of dollars – that would have to be spent to make this 12-year switch,” he insisted. “Massachusetts Institute of Technology (MIT) estimated that just by doing away with the fossil fuels for generating electricity and replacing it with wind and solar and battery storage technologies would be about $2.5 trillion over a 12-year period, and that really doesn’t take into account all of the other fossil fuels that we use for transportation in cars and trucks and farming.”

 

Opinion: America stills needs coal in 2019

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The Scranton Times Tribune (PA), Idaho State Journal (ID), Deseret News (UT), The Detroit News (MI), and the Johnstown Tribune Democrat (PA) carry my previously published piece, in which I write that policymakers must consider how much more coal-fired power can realistically be retired before the loss of so much around-the-clock, baseload power threatens the reliability of America’s overall electric grid.

In The News Today….1.11.19

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In the news today…

 

Coal:

  • E&E Greenwire reports Wyoming should continue to fight to enable more U.S. coal exports overseas, the state’s new governor said in a state of the state speech yesterday that also called for more spending restraint and better returns on state reserve funds.
  • The Virginian-Pilot reports all three coal terminals in Hampton Roads saw double-digit increases in exports last year when compared to 2017, and the port exported nearly twice as many tons as two years ago.

Energy:

  • Axios reports wind energy will be the largest source of new power capacity additions this year, while coal-fired power will keep fading but the losses will slow, according to an EIA snapshot yesterday.

World News:

  • Axios reports China is poised to gain global leverage with its dominance in clean-energy technologies, while poorer, fossil fuel-dependent nations like Libya will likely be on the losing end in the world’s shift to cleaner energy.
  • Forbes reports China has said it will not approve wind and solar power projects unless they can compete with coal power prices.

In The News Today….1.10.19

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In the news today….

EPA:

  • Energy News Network reports a Trump administration proposal to change how costs and benefits are calculated for federal mercury emissions rules could make them more vulnerable to a legal challenge. Hal Quinn is quoted.
  • POLITICO Pro reports President Trump has nominated acting EPA chief Andrew Wheeler to be the full-time administrator of the agency.

Coal:

  • The Wall Street Journal reports that last summer, Northern Indiana Public Service Co. NI -0.08% planned to retire two of its five remaining coal-fired power plants by 2023. Now, it plans to do away with all of them over the next decade, and buy more solar and wind power instead.
  • Argus reports the DOE has increased the funding it may provide for university research into scientific challenges and technology issues associated with improving performance of fossil fuel turbines.

Natural Resources:

  • E&E Daily reports lawmakers introduced a range of natural resources bills this week dealing with topics from agency transparency to restoration of lands and waters affected by coal mining.

Lights out: Can the U.S. survive a ‘catastrophic’ power outage?

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While most of the policy debate regarding the electric grid revolves around climate change and increased use of renewable energy, there is another important aspect of grid reliability–namely, the risks of catastrophic power outages due to natural disasters, cyber or physical attacks, or or an electromagnetic event. Any such event could cause a long-term outage. Security Boulevard, by way of Real Clear Energy, carries a thoughtful piece on whether the United States could survive such a catastrophic event. Following is the conclusion:

Through interviews with leaders in the utility industry and other related experts, the report found that existing plans to restore power were inadequate to deal with a catastrophic power outage.

The NIAC concluded that considerable public and private action is required to mitigate the risks associated with any such outage. Such a power outage could cause cascading failures in other essential services including water and wastewater management, communications, transportation, healthcare, and financial services — all of which are critical to public health and safety and our national and economic security.

The report concluded that the U.S. should approach the challenge in two predominate themes. The first is to “design a national approach to prepare for, respond to, and recover from catastrophic power outages that provides the federal guidance, resources, and incentives needed to take action across all levels of government and industry and down to communities and individuals.”

The second was to improve the nation’s understanding of how cascading failures across critical infrastructure will affect restoration and survival.

Scary stuff, but it is something we must face and address.

Statepowerproject.org Update: Petition to Review Oregon Low-Carbon Fuel Standard Decision at SCOTUS

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This is from an email I received from Ari Peskoe, Director of the Electricity Law Initiative at Harvard Law School:

Earlier this week, the American Fuel & Petrochemical Manufacturers (AFPM), a trade association, filed a petition seeking Supreme Court review of a Ninth Circuit decision addressing Oregon’s Low-Carbon Fuel Standard (LCFS). Petitioners argue that the state policy violates the dormant Commerce Clause by regulating out-of-state conduct (extraterritorially) and discriminating against out-of-state producers. In 2014, the Supreme Court declined to review a Ninth Circuit decision upholding California’s LCFS. AFPM’s petition makes essentially the same arguments as those made in the rejected 2014 petition.  

Oregon’s LCFS sets carbon-intensity targets for fuels imported into or produced in Oregon. State regulators assign carbon intensity values to various fuels based on extraction, production, and transportation methods. Each entity that produces fuel in Oregon or imports fuel into the state must meet average carbon intensity limits across all of its products. It can demonstrate compliance by producing or importing only fuels that meet the standard, by producing or importing fuels that meet the standard in aggregate, or by purchasing credits generated by fuels below the standard to reduce the average intensity of its products.

Relying on the Ninth Circuit’s decision upholding California’s nearly identical LCFS, a district court dismissed AFPM’s 2015 complaint that claimed the policy violates the dormant Commerce Clause. In September, the Ninth Circuit affirmed the dismissal. AFPM’s petition argues that the Ninth Circuit’s opinion is at odds with decisions of other federal appeals courts and contrary to Supreme Court precedent.

With regard to extraterritoriality, AFPM portrays the state’s carbon-intensity analysis as Oregon’s effort to “control conduct” in other states by restricting imports into Oregon. According to the petition, the Ninth Circuit’s holding that Oregon’s regulation is not extraterritorial because it only applies to fuels sold in Oregon contradicts recent decisions by the Fourth and Seventh Circuits and earlier decisions cited in the rejected 2014 petition by the First and Seventh Circuit. AFPM also highlights the 10th Circuit’s decision written by Justice Gorsuch holding Colorado’s RPS does not regulate extraterritorially and the Eighth Circuit’s review of a lower court decision holding a Minnesota law restricting coal-power imports did violate the dormant Commerce Clause as evidence that other circuits are “in need of this Court’s guidance” on extraterritoriality.

AFPM also argues that the Ninth Circuit’s failure to apply strict scrutiny to the LCFS contradicts decisions in nearly every circuit. Relying on its decision about California’s LCFS, the Ninth Circuit found that although Oregon’s carbon-intensity scores disadvantage some out-of-state fuels, the LCFS does not discriminate under dormant Commerce Clause doctrine because geography is “not the basis for any differential treatment.” AFPM counters that the policy assigns less favorable scores to Midwest corn ethanol than to Oregon corn ethanol and is therefore facially discriminatory. Courts reviewing facially discriminatory policies, according to AFPM, must find the policy unconstitutional unless the state can demonstrate that the law has a non-protectionist purpose and there is no less-discriminatory means for achieving that purpose.

AFPM’s petition is available at https://statepowerproject.org/oregon/.