If President Calls It Safe, Watch Out

Earthquake and Tsunami damage-Dai Ichi Power Plant, Japan

President Barack Obama is a good fellow at work in a difficult era, to say the least. So this post is not intended to be a slam on the president. Still, it is a good idea for Obama to be much more cautious when he draws from conventional wisdom, and the word of aides, to publicly express his view that a big energy sector is safe.

You’ll recall that on March 31, 2010, President Obama announced the government would open much of the Atlantic coastline and the eastern Gulf of Mexico to oil and gas exploration, deeming the benefits to the economy and security higher than the risks. Three weeks later the Deepwater Horizon exploded, releasing a torrent of oil into the Gulf.

Then in January, the president called for tripling public financing for new nuclear power plants in the State of the Union, and in public statements before and afterwards cited Japan’s long record as evidence that nuclear-generated electricity was safe. Seven weeks later, after being struck by an earthquake and tsunami, Japan’s 4,696 mw Fukushima Daiichi nuclear plant is completely destroyed and leaking life-threatening levels of radiation.

The Telegraph is reporting that Japan was warned about the vulnerability of its nuclear plants and that “an official from the International Atomic Energy Agency (IAEA) said in December 2008 that safety rules were out of date and strong earthquakes would pose a “serious problem” for nuclear power stations,” in Japan.

The Fukushima plant, by the way, is the 27th largest power generating installation in the world, the 12th largest nuclear station globally, and the second largest nuclear plant in Japan. It’s also one of the oldest nuclear plants in Japan.

— Keith Schneider

The New D.C. Drive to a Climate and Energy Bill

Obama and Harry Reid prepare for climate and energy legislation debate

Well, now the Senate is getting into the act, at last. Bolstered by new opinion polls and driven by a monstrous blowout that is closing Gulf Coast beaches at the height of the travel season, Democratic leaders stirred into action this week to develop and pass comprehensive climate and energy legislation.

They’re following, of course, the president’s lead. On Wednesday President Obama concluded an all hands cabinet meeting at the White House by publicly declaring again his resolve to develop a “new energy strategy that the American people desperately want.” The next day Democratic Senators caucused, apparently with considerable enthusiasm, to discuss the outlines of a comprehensive proposal to introduce and pass before the August recess.

According to news accounts, Democrats will prepare a bill that includes limits on carbon emissions, as well as new measures to advance clean energy development and more strictly manage deep water drilling. During a news conference Senate Majority Leader Harry Reid described the meeting’s outcome this way: “A number of senators said this was the best caucus they’ve ever attended. It was really very, very powerful. It was inspirational, quite frankly.”

With the president and Senate Democrats motivated in a way they haven’t been before, could this be the season of energy policy making that has eluded presidents and Congress for 40 years? Maybe. The gears of legislative action have swung into motion and there is the scent of inevitability in the air, which is what big bills need to get approved.

There’s also the Republicans, who were wounded last week by Texas Representative Joe Barton’s apology to the BP chief executive. But they aren’t dead. They’ll revert to form and attack limits on carbon emissions and clean energy development as a government overreach that raises costs.

BP Disaster’s Aftermath
The Democrats and environmentalists should have a ready answer to both. Here’s why.

The April 20 Deepwater Horizon explosion that killed 11 workers and the helplessness of the government and BP in controlling the blowout has reacquainted Americans with the colossal hazards of a nation so devoted to a single fuel. The BP Gulf disaster is more evidence of what candidate Obama described on the day he announced his campaign for president as the “tyranny of oil.” It is the latest body blow – the others include 9/11, Katrina, and the Great Recession – that stem from a common source: the nation’s fruitless 40-year struggle to take efficiency seriously and to develop cleaner domestic sources of energy.

Republicans frame their critique strictly around prices and Government action. But how much higher do the actual costs — erratic fuel prices, climate effects, national security risks, lost jobs, depleted savings, diminished home values, and the sense of a crumbling way of life — need to go before the country responds? Maybe we’ve arrived at that place where costs of doing nothing and the benefits of pursuing a new development strategy around cleaner sources of energy have tipped far enough to merit a big policy response.

Democrats are fortified by the results of public opinion polls that find strong support for a new energy and climate policy. One of the most significant was a survey of 1,000 people released this week by the Wall Street Journal and NBC News. It found that by a margin of 63 percent to 31 percent, Americans favor comprehensive energy and carbon reduction legislation. The survey’s findings were consistent with a burst of other national poll results in recent weeks, which also found that public support for new offshore exploration has steadily declined since the start of the BP disaster 67 days ago.

The Oil Judge
The energy industry and its allies in government will not give up easily, we also saw this week. U.S. District Judge Martin Feldman, who sits on the Louisiana federal bench, this week struck down the six-month ban on deepwater oil drilling that the Obama administration established late last month. Federal disclosure reports showed Judge Feldman invested heavily in oil industry assets, including holding and recently selling stock in Transocean, the company that owned and operated the Deepwater Horizon under contract to BP.

Back in Washington, the outlines of the Senate proposal are taking shape. Senator Reid said this in a statement: “There is clear agreement on the need to move forward this summer on comprehensive clean energy legislation. Whatever form that takes, we agree: it must deal with the catastrophe in the Gulf; it must create millions of jobs; it must cut pollution; and it must strengthen our economic security, our national security and our energy independence.”

On Tuesday, a bipartisan group of senators meet with the president about energy legislation, which could be introduced next month.

— Keith Schneider

Bubbling and Crude: Gulf Coast Spill Reflects Devotion to Wealth, Power, and Oil

On March 17, two weeks to the day before President Barack Obama laid out a new plan to expand offshore oil exploration in the United States, a government auction of federally controlled oil and gas reserves in the Gulf of Mexico was held at the New Orleans Superdome. It took just a few hours for 77 energy companies to pledge $1.3 billion to the U.S. Treasury to look for oil and natural gas across a 2.4 million-acre expanse of bottomlands 200 miles from shore, and in most cases thousands of feet below the surface.

The lease sale, one of the most lucrative on record, bolstered the Gulf’s global reputation as one of the hottest deepwater oil and gas plays on Earth. The Gulf of Mexico is responsible for a quarter of the 5.5 million barrels of oil produced daily in the U.S., according to the Department of Energy. And of the 1.4 million barrels produced daily in the Gulf, 1.1 million barrels comes from over 100 deep sea production platforms. The Interior Department predicts that by the end of the decade, deep sea production in the Gulf could reach nearly 2 million barrels a day.

See USCAN Oil Spill Page

Semi-submersible drilling platform

Source: The Economist

Though offshore oil production is dangerous – 165 people died when an offshore platform exploded off the coast of Scotland in 1998; 10 more people were killed in a drilling rig explosion off the coast of Brazil in 2001 – a kind of Titanic syndrome had set in with Gulf coast oil explorers. The high-tech, semi-submersible, nearly $1 billion floating drilling platforms that operated in the deep Gulf waters were seen as too big, too modern, too well-equipped to fail.

Moreover there is so much oil (and natural gas) beneath the deep Gulf bottomlands – 85.9 billion barrels of oil, according to several estimates – and so much money to be made at $70 to $100 a barrel, that downplaying the risks made economic and political sense. Federal drilling permits obtained by developers normally did not require extensive and time-consuming analysis of the environmental risks, the government has acknowledged.

On April 20, an explosion and fire aboard Transoceans’ Deepwater Horizon drilling platform, which was operating under contract to BP, killed 11 workers. The accident provided the latest unmistakable evidence of the workplace hazards of deep sea exploration. Then two days later, on Earth Day’s 40th anniversary, the Deepwater Horizon sank and simultaneously produced an oil slick that the government says is growing by about 5,000 barrels of oil daily.

America Awake?
By any measure, the Gulf spill has reawakened the nation and magnified the human, environmental, and political consequences of oil production, especially from such treacherous places as the deep ocean. But the spill has not yet made clear what, if anything, the nation is prepared to do in response.

Indeed, the Deepwater explosion and the spreading slick are apt metaphors for an era of striking domestic risks related to energy production and consumption and growing uncertainties about how to reduce them.

Not Santa Barbara, Not 1969
There is no longer much reasoned debate that America’s devotion to fossil fuel, and especially to oil, has contributed to dangerous energy insecurity, rising atmospheric concentrations of climate changing gases, increasing costs, decreasing incomes, and a ferocious national recession. Yet the national response is so different than the  January 1969 oil spill in Santa Barbara, California, which soaked the beaches with crude oil. That spill produced a momentous national that helped to launch Earth Day and a decade of policy making that cleared the skies and cleaned the waters.

In contrast the Deepwater spill, so far, has produced modest public concern nationally and little more than that.

President Obama on April 30 announced he would suspend his March 31 decision to open new areas to offshore exploration pending a full investigation of the Deepwater accident. In the Senate, where a climate and energy bill has been delayed because of partisan infighting, lawmakers debated whether the Gulf spill would 1) break or 2) cement the deadlock.

It is clear the United States needs a new energy policy. The devastating spill has heightened awareness on Capitol Hill to the dangers of U.S. dependence on oil. Democratic Senators Robert Menendez and Frank Lautenberg of New Jersey, and Bill Nelson of Florida held a news conference this week to alert their colleagues that including additional offshore oil exploration has no place in a comprehensive climate and energy bill.

Halting the Spill
In the Gulf, BP says it is moving as fast as it can to plug the well and on Wednesday the company announced that it had stemmed one of three leaks in the pipe that once attached the well to the Deepwater drilling platform. Fishing in the coastal waters, some of the most productive fishing grounds on the planet, has been suspended. Meanwhile the governors of Louisiana, Alabama, Mississippi, and Florida expressed concern about the expanding spill, which was drifting closer to their shores.

Production Data by Year
Deepwater Production
(WD > 1000 Ft)
Total GOM OCS Production % of Total Production
Year Oil, STB Gas, MCF Oil, STB Gas, MCF Oil Gas
1985 21,053,752 33,849,349 350,345,117 4,057,692,707 6.009 0.834
1986 19,077,066 36,900,361 355,542,244 4,043,350,172 5.365 0.912
1987 17,070,926 44,259,499 327,567,672 4,524,823,392 5.211 0.978
1988 12,984,552 38,228,499 301,206,145 4,577,391,080 4.310 0.835
1989 10,007,573 31,889,109 280,717,909 4,636,327,746 3.564 0.687
1990 12,141,988 30,502,933 274,588,473 4,907,774,159 4.421 0.621
1991 22,886,754 58,434,483 294,773,846 4,707,640,841 7.764 1.241
1992 37,295,127 87,256,174 304,865,294 4,650,566,185 12.23 1.876
1993 36,769,914 119,895,532 308,595,948 4,655,807,596 11.91 2.575
1994 41,803,238 159,473,125 314,096,027 4,823,738,315 13.30 3.306
1995 55,200,884 181,019,918 345,074,597 4,778,657,050 15.99 3.788
1996 72,213,069 278,233,940 368,869,292 5,076,875,432 19.57 5.480
1997 108,514,650 381,759,185 411,622,518 5,145,646,361 26.36 7.419
1998 159,232,680 560,475,922 444,286,882 5,041,746,574 35.84 11.11
1999 225,089,761 845,581,180 495,172,107 5,057,740,045 45.45 16.71
2000 271,144,316 998,859,653 523,029,835 4,958,172,377 51.84 20.14
2001 315,392,362 1,178,429,028 558,790,340 5,060,515,587 56.44 23.28
2002 348,566,124 1,286,974,486 567,887,406 4,526,660,570 61.37 28.43
2003 350,151,883 1,425,729,552 561,457,768 4,428,661,841 62.36 32.19
2004 347,916,489 1,396,450,720 535,313,731 4,005,649,257 64.99 34.86
2005 325,565,912 1,189,574,009 466,916,529 3,155,021,736 69.72 37.70
2006 341,286,543 1,093,900,026 472,034,405 2,921,947,061 72.30 37.43
2007 328,111,873 1,027,012,933 468,007,128 2,812,063,179 70.10 36.52
2008 310,628,395 997,860,793 421,221,179 2,328,093,003 73.74 42.86
2009 454,502,063 1,094,148,891 566,000,231 2,427,822,032 80.30 45.06
Deepwater Production Increase – Year to Year
Year % Increase, Oil % Increase, Gas
1985 to 1986 -9.3 9.01
1986 to 1987 -10. 19.9
1987 to 1988 -23. -13.
1988 to 1989 -22. -16.
1989 to 1990 21.3 -4.3
1990 to 1991 88.4 91.5
1991 to 1992 62.9 49.3
1992 to 1993 -1.4 37.4
1993 to 1994 13.6 33.0
1994 to 1995 32.0 13.5
1995 to 1996 30.8 53.7
1996 to 1997 50.2 37.2
1997 to 1998 46.7 46.8
1998 to 1999 41.3 50.8
1999 to 2000 20.4 18.1
2000 to 2001 16.3 17.9
2001 to 2002 10.5 9.21
2002 to 2003 0.45 10.7
2003 to 2004 -0.6 -2.0
2004 to 2005 -6.4 -14.
2005 to 2006 4.82 -8.0
2006 to 2007 -3.8 -6.1
2007 to 2008 -5.3 -2.8
2008 to 2009 46.3 9.64
Average (through 2008) 16.7 18.3

Source: Minerals Management Service

— Keith Schneider

Go Blue! “Be Nice” While You “Shape Destiny,” Obama Counsels at University of Michigan Commencement

michigan-graduation-450-2

Barack Obama addressed 90,000 people Saturday at the Big House, the University of Michigan’s football stadium, where he was greeted warmly by the largest crowd to hear the president since the inauguration. Among the nearly 10,000 graduates was my daughter Kayla.

The university is a place of innovation, stability, and optimism in a state that has endured more negative consequences of the recession, and the underlying transitional factors that caused it, than any other. The evidence list is long and familiar. Detroit is losing 10,000 residents a year, and is home to less than half as many residents as it had in the 1950s. The state is just one of two — Rhode Island is the other — that is losing population. Joblessness is high. Incomes are low. Most of Saturday’s graduates will begin their careers outside Michigan, where we’ve been sending our best   since 1990. For two decades in a row, Michigan has been a national leader in exporting its brightest young minds.obama-at-michigan-cropped-2951

Michigan voted for Obama because he represented hope and because his calm, self-effacing, and candid style is appreciated even though the state is fueled by division. Blacks from whites. Urban from suburban. North from south. Detroit from Grand Rapids. Conservatives from liberals. Front office from shop floor. Michigan from Michigan State. Perhaps that’s why Obama, who’s confronting upheaval and resistance at every turn — war, the economy, jobs, political opposition in both parties, climate change, energy, and an expanding environmental disaster in the Gulf — chose Michigan as the place to address how Americans behave in the public arena. His speech, he said, was prompted by a kindergarten student who sent him a letter that asked, “Are people being nice?”

The obvious answer is no. They’re not. In the public arena people behave poorly, rudely, aggressively, with insolence and anger. “Part of what civility requires is that we recall the simple lesson most of us learned from our parents: Treat others as you would like to be treated, with courtesy and respect,” said Obama.

Of course, there is more to it than that. Obama described a democracy that has tilted dangerously because  bad behavior draws the attention of both parties, the news media, policy makers, and seems to encapsulate the boiling energy of the era of transition that has enthused some and worried most.

Very clearly, Obama is dismayed by the ferocity of the public exchange. How do you know? Easy. He’s complaining about the media, a sure sign of presidential frustration. “Today’s 24/7 echo-chamber amplifies the most inflammatory soundbites louder and faster than ever before,” he said. He added: “If we choose only to expose ourselves to opinions and viewpoints that are in line with our own, studies suggest that we become more polarized, more set in our ways. That will only reinforce and even deepen the political divides in this country.”

“We need a vibrant and thriving news business that is separate from opinion makers and talking heads. That’s why we need an educated citizenry that values hard evidence and not just assertion. As Senator Daniel Patrick Moynihan famously once said, “Everybody is entitled to his own opinion, but not his own facts.”

But the problem of incivility in the public arena, which has existed for all of the nation’s history, is critical now because of the speed of market and environmental changes, and the inability of decision makers to agree on responses. “When our government is spoken of as some menacing, threatening foreign entity, it ignores the fact that in our democracy, government is us,” said the president. “We, the people. We, the people, hold in our hands the power to choose our leaders and change our laws, and shape our own destiny.”

The point resonates with me. I just spent three months working with a utility in northern Michigan that wants to do a good thing –– generate 30 percent of its power with local renewable resources by 2020. Despite that goal, the utility was charged by some members of the community, and the major daily and weekly newspapers, with the equivalent of environmental genocide. A 10 mw combined heat and power wood biomass generating station would lead to forest “slaughter,” “toxic” ash, and all manner of “cancer causing” pollutants. None of these is true.

As a member of the team that designed and executed a communications and public engagement process to accomplish the utility’s goal I personally was described by such lovely phrases as poseur,  sinner, liar, shill, hypocrite and a few more choice words too. And that was from environmentalists I’ve worked with for years.

“The problem with it,” said the president, “is not the hurt feelings or the bruised egos of the public officials who are criticized. Remember, they signed up for it. Michelle always reminds me of that. The problem is that this kind of vilification and over-the-top rhetoric closes the door to the possibility of compromise. It undermines democratic deliberation. It prevents learning –- since, after all, why should we listen to a “fascist,” or a “socialist,” or a “right-wing nut,” or a left-wing nut”?

“It makes it nearly impossible for people who have legitimate but bridgeable differences to sit down at the same table and hash things out. It robs us of a rational and serious debate, the one we need to have about the very real and very big challenges facing this nation. It coarsens our culture, and at its worst, it can send signals to the most extreme elements of our society that perhaps violence is a justifiable response.”

— Keith Schneider