Energy Group Says California Policies Are Responsible For Skyrocketing Prices

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By Kevin Killough, energy reporter
Kevin@CowboyStateDaily.com

Tapping into the energy of a Republican-controlled U.S. House of Representatives, energy industry advocacy group Power The Future published a report Monday that lays out a policy roadmap for legislators that could benefit Wyoming’s oil, gas and coal industries.

Among the recommendations in the group’s “Energy Policy Roadmap” is passing legislation that would eliminate a rule that allows California to set its own emission standards, which is driving up new vehicle prices.

Among nine other proposals, the report also recommends repealing EPA regulations that were big drivers for two refineries in Wyoming converting to biofuels that are shipped to California. 

Good Opportunity

Democrats will likely hold a majority in the U.S. Senate for the next two years, which would allow Democrats to block any legislation coming from the House. That would make it difficult to reverse the anti-fossil fuel policies of the Biden administration. 

Rick Whitbeck, Alaska state director for Power the Future who has worked on Wyoming energy issues, told Cowboy State Daily that there is still an opportunity for House Republicans to make a difference for American energy, even without a majority in the Senate. 

As voters are hit with higher energy costs, which drives up the cost of everything, they’ll be watching Congress for who prevents energy policy reform, he said.

“It’s just not going to get any better until somebody makes a course correction,” Whitbeck said. “If the Republicans are going to make a course correction and the left blocks it again, then that will be a differentiator in 2024.”

Ten Proposals

Whitbeck said the goal of the Energy Policy Roadmap was to give Congress, if it had flipped into Republican hands in both the House and Senate, a starting point to achieve energy independence and dominance in the United States. 

“The goal was to put some meat on the bone,” Whitbeck said. 

The report offers 10 policy proposals that address what it calls a “de facto” moratorium on oil and gas leases, end to woke investing regulations, improve refinery capacity, eliminate increases in natural gas taxes and stop Biden’s war on coal. 

Refining Policy

The roadmap report details how the Clean Air Act authorized the EPA to grant California a waiver that allows it to set its own emissions standards. After California does so, other states can adopt the same standards without EPA review.

President Donald Trump had revoked the waiver, but Biden reinstated it. As a result of California’s standards spreading across states, the auto industry will now impose greenhouse gas emissions standards that will make conventional cars more expensive. 

Adding to this is the renewable fuel standards, which require refineries to mix a certain amount of biofuels into the products they produce. Two refineries in Wyoming switched to producing biofuels to tap into the market driven by the standards. 

The roadmap report recommends passing legislation to repeal the EPA’s authority to grant California a waiver to set its own emissions standards for new cars and trucks. It also recommends a bill prohibiting the EPA from establishing emissions standards that effectively ban gas-powered vehicles and mandate auto manufacturers to build electric vehicles. 

No Woke Backdoor

The report takes aim at woke investing, also known as Environment, Social and Governance (ESG) ratings. According to Power The Future, “ESG pressures are serving as a block, preventing capital from entering the oil market.” 

The firm estimates that capital spending at the 100 largest energy companies in the S&P 500 topped out at $228 billion in 2014. Five years later, it was down to $155 billion. 

Securities and Exchange Commission Chairman Gary Gensler, a Biden appointee, proposed a rule that would require publicly traded companies to disclose their climate risks. The roadmap report calls it a “thinly disguised attempt at ‘backdoor regulation’ by the Biden Administration.” 

“Chairman Gensler has decided that he’s going to be a foot soldier in the Biden administration’s war on fossil fuels,” Whitbeck said. 

Methane Fee 

Buried in the Inflation Reduction Act (IRA) was a “methane fee” that the American Gas Association said will ultimately cost consumers billions of dollars on top of already skyrocketing natural gas prices. In an analysis of the IRA, the Congressional Budget Office concluded the tax “company’s increased expense is expected to be passed through, in part, to end users [consumers] in the form of higher prices.”

The Energy Policy Roadmap recommends passing legislation that repeals the tax.

Hydraulic fracturing greatly increased America’s natural gas production, and the American market was flooded with cheap natural gas. By switching from coal, the U.S. saw enormous reductions in CO2 emissions. Even before the 2020 pandemic sent energy usage down, the U.S. had lowered its emissions to 1990 levels. While wind and solar played some role in that, natural gas was a key driver. 

Whitbeck said that presented a problem for anti-fossil fuel interests. By driving up natural gas prices, it made renewables more competitive as an energy source. 

Federal Leasing

The roadmap also details the lengthy court cases involving Biden’s efforts to stop all oil and gas leasing on federal lands, which have been quite successful. Under the Biden administration, the fewest federal acres have been leased by any president since World War II. 

The recommendation from Power The Future is to pass legislation repealing Biden’s moratorium and require legislative approval for any future moratoriums on federal leasing. 

Power The Future also called for an end to Biden’s war on coal, which is driving the closure of coal-fired electrical generation. The EPA has clamped down on what it calls “conventional pollutants,” such as nitrogen oxides, sulfur dioxides and ozone. 

The rules that followed these efforts, such as coal ash pool management, regional haze regulations and others have greatly driven up the cost of coal-fired generation, just as the methane fee drove up the cost of natural gas. 

“If Congress takes these bold, but practical steps, to stop Biden’s attack on American energy, it can restore hope for energy workers, consumers, and the economy,” the report concludes. 

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