Why the president of the Western Energy Alliance says Biden ‘wants to kill American oil and gas’
Meanwhile, green energy advocates say he is not moving fast enough to transition away from fossil fuels
Utah, like other fossil fuel rich states, has been listening to the words of President Joe Biden when it comes to energy development with some wariness and incredulity.
The president has made it clear he fully embraces green energy while at the same time making hostile comments — threats even — aimed at fossil fuels, including his promise to shutter all coal-fired power plants and an eventual end to domestic oil and gas leasing under federal purview.
At the same time, even as the industry is locked in a battle with him, clean energy advocates in some corners say he is not moving quickly enough to transition away from fossil fuels and is instead bowing to the pressure of oil and gas producers.
A president in quandary over green energy
Biden made the threat to cease all domestic oil and gas production, something he simply can’t accomplish — although he might make it tougher in a regulatory sense, said Rikki Hrenko-Browning, president of the Utah Petroleum Association.
She pointed out that in Utah there is robust oil and gas production on state lands and lands controlled by Native American tribes — something beyond presidential reach. In North Dakota, which contains only 3% federally-controlled land, those rigs are also outside his purview. Utah has seen some dramatic shifts, in fact, away from drilling on federal public lands because of the regulatory uncertainty.
“And while I don’t believe that President Biden can single handedly stop oil and gas drilling in our country or that he would because the economic and geopolitical and national security consequences would be so overwhelmingly catastrophic, it’s still irresponsible to mislead the American public that this is a course of action that he could take or should happen,” Henroko-Browning said.
Picking winners and losers
Biden’s critics say the president, by pushing so hard for subsidies for renewables and electric vehicles, is picking winners and losers, asserting the country remains in the position where it continues to need all forms of energy to survive and make prices affordable for the pocketbook.
“There’s been pushback,” said Gregory Todd, the energy adviser to Utah Gov. Spencer Cox and director of the state Office of Energy Development.
“I‘m appalled that the president of the United States is picking a loser and picking a winner. I think the free enterprise process is what should happen and you know, the coal industries have been vilified, oil and gas industry has been vilified. It’s sad.”
Todd said that does not even speak to Utah and other states’ growing instability when it comes to meeting the demands of an energy grid in need of upgrades, including new transmission capacity and balancing a market that is increasingly turning to intermittent renewables that fail to provide base load power absent reliable storage.
He said he was talking about the concerns the other day with some people in the electric sector.
“They’re concerned about it. Without true base load, we could be in trouble in the next year or two, even as all the other projects that are coming in. That’s a factor that we’ll all have to look at, in respect to our electric needs. And they’re actually looking at some things of what’s essential and what isn’t essential and, in the electric world, none of us have ever thought of that, at least in my lifetime.”
Henrko-Browning goes back to the population growth in the United States, particularly in the West, coupled with growing grid problems, asserting the Biden administration needs to take a more holistic approach.
“I would go back to the point that we need all kinds of energy and it is the best to produce oil and gas, and renewables. You know we have all kinds of energy here in the United States, more than anywhere else in the world. This is not an ‘either or’ proposition,” she said. “And the administration should be doing more to encourage growth of supply if they are sincere about wanting to bring down gas prices.”
Green energy infusion and climate goals
Tom Moyer, state coordinator of the Utah Citizens Climate Lobby in Utah, is enthusiastic over the money being infused into Utah via the Inflation Reduction Act to bolster the acceleration of clean energy.
“We hope the market picks up those incentives and runs with them, as it already is. So we want to see rapid build out of clean energy technologies. And we would also like to see domestic supply chains for battery and EV manufacturing, which the Inflation Reduction Act does a good job of incentivizing. So we hope the private sector runs with that as well.”
But Moyer is realistic about a rapid clean energy transition that he says wrongly leaves other forms of energy — including fossil fuels — choking on the ensuing dust.
He pointed to the state’s generous geothermal energy resource and the development of small nuclear reactor technology, with emphasis on the nation’s necessary and continued reliance on fossil fuels for the foreseeable future.
“The rhetoric about oil and gas is back and forth. And it’s political. Biden’s caught in a political bias between people who want him to shut down oil and gas and the reality that you can’t do that,” Moyer said. “We need it, and attempts to shut it down just drive prices up. So, our position is that you build the alternative, that it is right to build the alternatives as fast as you can go. And don’t worry about what we shut down just yet. That’ll take care of itself in due time.”
Athan Manuel, lands protection program director with the national Sierra Club, agrees with Moyer that the Inflation Reduction Act is packed full of positive green energy provisions maintaining a goal of a 40% reduction in emissions by 2030.
Although its passage was a day of celebration, he said it was marred by a component of the law that prohibits any new wind development, either offshore or on, until there are 60 million acres of new oil and gas leases offshore and two million more acres of federal land mandated for oil and gas leasing.
“It’s a hard workaround for us, but we’re trying to figure out ways to push back legally and find other political avenues,” he said.
He said the link between the two is unfortunate.
“I really do think that eventually this administration was going to put us on a glide path to ending leasing on federal lands both on and offshore, but the IRA completely upended that. So it’s hard when the law says you have to do leasing for oil and gas drilling. That’s our challenge — to find a way to push back on that successfully.”
The price of gas and Utah
The transportation sector is already feeling the pain at the pump and Utah consumers in general have long complained about higher than national average gas prices.
A new report issued by the Office of Energy Development explained the production pressure in Utah and the increasing diminishment of refining capacity, which puts strain on the consumer’s wallet.
“West Coast demand for Utah refined products has increased because of diminishing supply in the West due to refinery closures and biofuel conversions. This increased demand for Utah products from markets that experience higher prices has resulted in higher rack prices at Utah refineries. In short, while demand pressures continue to grow, supply is dropping in other markets where Utah products are sold, creating pricing pressures,” it said.
The report added: “Utah’s refining capabilities are at or near their maximum capacity, and as out-of-state markets continue importing Utah’s cheaper refined products, the market price for Utah’s gasoline goes up. Subsequently, the state will either pay higher prices for gasoline or must source it elsewhere.”
Refining capacity, in fact, is down more than a million barrels a day across the United States, Henrko-Browning said.
Not all oil is the same
For the “Keep it in the Ground Movement,” Hrenko-Browning pointed out there is a lot of misunderstanding, ignorance even, about the many uses of oil aside from the transportation sector.
An article and information graphic released by Illinois Petroleum Resources Board said about 6,000 everyday products are a result of refining of natural gas products and crude oil, with gasoline representing 45% of U.S. petroleum consumption.
The other 55% is used in such things as toothbrushes, rubber balls, birthday candles and plastic dust pans.
Resins eventually converted during a complicated chemical process help in the manufacture of cellphones, parts for solar equipment, and yes, the oil itself is used to lubricate wind turbines.
Oil plays a huge part in the health care sector, including the manufacture of latex gloves, artificial heart valves, X-ray machines and prosthetics, the Illinois Petroleum Resources Board said.
Henrko-Browning said natural gas, a result of crude oil production, is an essential ingredient in fertilizer used to grow crops, a component of national food security. Fertilizer is already in short supply due to the war in Ukraine as that nation fights to fend off Russia.
The World Bank blogged that fertilizer prices jumped by 30% this year, following an 80% surge the year before. The impacts are being felt globally, with a number of factors at play aside from the Eastern European war.
Coal and Biden’s conundrum
Biden announced he wanted to shutter all coal fired power plants in the United States, despite many already on track for retirement.
At the same time, global demand for coal is rising. The International Energy Administration reports that consumption rose by 5.8% coming out of the pandemic, with China and India leading the way. China, in particular, is in pursuit of or is already building new coal-fired power plants. The country accounts for half the global coal consumption.
Any pursuits by Utah officials to expand its resources or tap into export avenues for its coal have been met with resistance, particularly lawsuits from environmental advocates.
A planned expansion of Utah’s Lila Canyon coal mine granted by the Bureau of Land Management by the Trump administration spurred a lawsuit this summer by the Sierra Club, and another coal mining expansion of Utah’s Alton mine was challenged by advocates and was threatened by a previous moratorium on new leases.
Utah’s efforts to get more of its coal overseas have also been met with lawsuits from West Coast advocates who do not want the state to have access to shipping ports.
The whole issue is frustrating for Brian Somers, president of the Utah Mining Association.
“With energy prices at highs not seen in 40 years and many grid operators predicting electricity shortages this winter, President Biden’s comments about shuttering coal power plants ‘all across America’ are extremely irresponsible and disturbing. Utah’s citizens and industries count on coal — produced in the state — to generate nearly two thirds of the electricity we consume,” he said in a prepared statement. “Rhetoric from the president which signals disinvestment in and regulatory peril for our energy producers threatens Utahns’ energy security, quality of life and pocketbooks.”
Energy: Biden’s Achilles’ heel?
Political pressures, Biden’s pursuit of clean energy and the reality of the country’s continued reliance on fossil fuels have all combined to push the U.S. president into a state of awkwardness, and his critics say it shows.
“You know, we certainly had a lot of promises from the president coming into his administration that he recognized the inconsistency between supporting climate action and endorsing more fossil fuel production. And he did indicate that he wanted to see a pause on new oil and gas leasing and some restraint around federal coal mining,” said Jeremy Nichols, climate energy program director for WildEarth Guardians. “And obviously, he’s faced a lot of pushback from industry, the fossil fuel industry, and you know, the politicians they support, but it has been very imperfect.”
At the same time, Nichols said the planet is being ravaged by emissions from fossil fuels — particularly the western United States — but Biden is just dancing around the issue, with advocates expecting more definitive action.
“Fundamentally, you’ve got to just say at some point we don’t want fossil fuels, and we’ve got to start keeping oil, gas and coal in the ground,” he said.
Kathleen Sgamma, president of the Western Energy Alliance, said Biden’s inconsistent statements on fossil fuel development is being watched by the industry, but with a roll of the eyes.
“I don’t think anybody takes President Biden’s statements seriously. Well, not just on energy but on a whole host of issues. I mean, he says something one day and it’s clearly a flub, and the White House has to clean it up.”
More dangerous are the actual policies he’s acted on since his first day in office that are clearly intended to hurt domestic oil and gas production, she said.
“We know that the policies continue to be hamstringing the industry and so we’re not as able to react to these high energy prices and bring them for the consumer as we would otherwise, pipelines being the most glaring example,” Sgamma said. “If we can’t get natural gas pipelines, we can’t drill for oil.”
Sgamma said while Biden made concessions to voters while on the campaign trail, she believes it did not fool the industry.
“So when he says he wants us to drill and then he says he doesn’t want us to drill — you know we all take that as we know exactly what he wants to do. He wants to kill American oil and natural gas.”