ARB Desperately Defends AB 32 - With OIL!

Sometimes, the California Air Resources Board does some simply amazing (read: ludicrous) things. This week saw more than one, as discussed below. The language chosen for this missive is quite instructive. The ARB ship is in quite a panic over the looming possibility that AB 32 will be consigned to the big landfill in the sky, in November 2010's elections. (see this link for the ARB pronouncement, reproduced in its entirety below)

SACRAMENTO (3/22/2010)- Chairman of the California Air Resources Board issued the following statement on the study released today by the AB 32 Implementation Group on the implementation of AB 32, California's climate plan: "This study was conducted by a group dedicated to protecting oil companies and fighting environmental laws that hold them accountable for polluting our environment. It comes as no surprise that their findings support oil companies and oppose clean energy laws Californians overwhelming support. The California public isn't going to fall for the claim that continued dependence on imported oil is better for the economy than switching to more energy efficient vehicles and cleaner renewable energy which will result in green technology job creation and a cleaner environment." [emphasis added]

Because this is so carefully worded, I deconstruct this below, and offer a few comments. (my emphasis in bold)

"This study was conducted by a group dedicated to protecting oil companies and fighting environmental laws that hold them accountable for polluting our environment."

The AB 32 Implementation Group (link here), has dozens of members that includes environmental organizations, with quite a few chambers of commerce. The members range from small businesses to large. One must wonder if AB 32 Implementation Group has a basis for a defamation lawsuit, based on the mis-characterization by ARB. As to protecting oil companies, they are quite able to protect themselves. It is quite obvious that oil companies have a great deal of practice in that, as they are attacked at every turn and almost daily.

But really, ARB, must one go on and on about oil companies polluting our environment? Would you really like to live in a world without oil? Do you realize how much the oil companies (and by extension, natural gas) have done to REDUCE pollution in the atmosphere and elsewhere? As I wrote here:

"Petroleum has brought the world un-ending prosperity, health, wealth, medicines and materials undreamed of, and saved the planet by cleaning the air we breathe from coal-based and animal dung-based odors and particles.

Petroleum is the only resource that provides heating, electric power, transportation fuels, lubricants, chemical precursors, waxes, and many others. No other resource can do what petroleum does, not coal, not nuclear, not wind, not wave, not solar, not geothermal, and at such a low cost.

Rather than vilifying the petroleum industry, you should be praising it – and by extension, the natural gas industry - for all the good that it has brought mankind."

Next, ARB writes that "

It comes as no surprise that their findings support oil companies and oppose clean energy laws Californians overwhelming support. "

Note what ARB is trying to do here: turn the conversation (spin is the in-vogue word) so that "evil oil companies" are the focus. Why not tell the truth, ARB, and admit that AB 32 will have an enormous detrimental impact to ALL businesses in California - any business that purchases electric power, or gasoline, or diesel fuel, or any goods that move by diesel-powered trucks, which does include oil refineries, of course, but also millions of small businesses? Why the spin and focus on oil companies? Likely it is because in this battle of wits, ARB is out of ammunition and must resort to the tired old litany of "blame the oil companies." Why not admit that the Renewable Portfolio Standard, for one thing, does not impact the oil companies but instead attacks the electric power providers, such as PG&E and Southern California Edison?

As to opposing clean energy laws, who says those laws are good? California already has the most clean energy of any state, expressed as a percent of total electric power sold in the state. As a direct consequence, California also has one of the highest prices for electric power in the country. Yet, more renewable power is mandated under AB 32, with 20 percent required by this coming New Years' Eve, 12/31/2010. Thirty-three percent is required by 2020. If renewable power is such a good thing, why isn't the marketplace providing it without government mandates? After all, automobiles were made and sold in the millions early in the 20th century - and no law required that. Personal computers were unheard of 50 years ago - but began selling by the millions and billions when some smart guys starting making them - with no law requiring that. Same for cell phones. Same for hundreds of useful products and services (cable TV comes to mind).

The "overwhelmingly support" line is just not true, and ARB will soon find this out after the election. Californians want jobs, want to earn a living, want to have an income with which to pay their bills and take care of their families, as do most all people. Polls show that global warming is not a priority for most people, and the science is shown to be bunk. Even if there were something to the idea that CO2 causes global warming, California is far too small to make any difference. California consumes approximately 2 percent of all the energy in the world. Reducing that 2 percent by one-third, as AB 32 is supposed to do by 2020, will make no noticeable difference.

"The California public isn't going to fall for the claim that continued dependence on imported oil . . . "

Ah, now we see another switch, this time to imported oil. Hey, ARB? Isn't AB 32 supposed to be about stopping global warming? I read the entire law, several times, and did not see a reference to imported oil. In fact, no reference to oil, period. So, why the switch? Why are you not focused on the global warming disaster looming over us all, and how AB 32 will heroically rescue the world from that doom? Imported oil? Grasping at straws here, ARB. Comical, really.

Actually, ARB, the USA has been using less oil for the past 5 years (since 2005). Total crude oil runs to refineries has been dropping, and is expected to continue doing so. How can that be, ARB, since AB 32 was not even passed until 2006?

"is better for the economy"

Is ARB actually stating that importing oil is bad for the economy? Really? After decades of importing oil (from numerous countries, not just the Middle East), ARB wants to show that importing oil depresses an economy? How then, does ARB explain the Reagan-era economic boom (20 years at least) - yet the USA saw increasing amounts of imported oil? Distraction is a key debate tactic, but to be used only when one knows the debate is lost. Is the debate lost, ARB?

“than switching to more energy efficient vehicles . . . “

Here, ARB pulls out the more efficient vehicles topic, which does exist in AB 32 as the Pavley Standards. Note that ARB has relaxed the Pavley Standards, to match those recently imposed by the Obama administration for the entire country. More energy-efficient vehicles (ARB, yes, there is a hyphen in that phrase) may be very bad for the economy, as consumers find the added cost not worth the savings in gasoline. I wrote on this in several places, but the fact is that with gasoline price below $3, it is very difficult to justify hybrid technology with its added costs. No mention of that, ARB? Why not?

“and cleaner renewable energy . . .”

Now ARB again brings up cleaner renewable energy, but the same questions remain. How much will each consumer's electric power bill increase, and how will that higher price of power influence business decisions on when to leave California and start up somewhere with lower power prices?

“which will result in green technology job creation . . .”

Green technology job creation is ARB's standard line with AB 32. Yet, independent studies show that AB 32 will kill jobs - and ARB knows this. If green policies created jobs, why is California having such great unemployment? This state should be booming with economic activity, with all the environmental restrictions on air pollution, the California emissions laws on cars that for many years made California cars different from all others in the US, with California gasoline regulations unique in all the US, and many others. Where are the green jobs, ARB?

“and a cleaner environment."

ARB finally gets to the old stand-by, we need a cleaner environment. How clean, ARB? At what price, ARB? At what point do jobs and economic activity take priority over some arbitrary clean-ness of the air? How many auto assembly plants still operate in California, ARB? There have been many new plants built in the USA in the past 20 years, how many were in California? California already has the most restrictive air pollution laws in the USA, probably on the planet, so much so that economic activity is adversely affected. And now, ARB wants even more.

In conclusion, it is actually comical to watch ARB thrash about in such obvious pain over the specter of AB 32 being repealed, by the voters at the ballot box. Please, ARB, try to remember the basics of AB 32. It's in the law. The law states that CO2 causes global warming, and AB 32 is the Global Warming Solutions Act. There is nothing in the law about oil, imported or otherwise (there is one mention of petroleum, with reference to refineries). Experienced and independent analysts have repeatedly shown that forced measures of AB 32 will kill jobs, increase prices, decrease disposable income, and cause business to not choose California as their home.

Roger E. Sowell, Esq.

Marina del Rey