NPRA, others sue over California low-carbon fuel standard

Nick Snow
OGJ Washington Editor

WASHINGTON, DC, Feb. 4 -- The National Petrochemical & Refiners Association and three other organizations legally challenged California’s low-carbon fuel standard on Feb. 2.

“The California LCFS is unlawful for a number of reasons, including the fact that it violates the Commerce Clause of the US Constitution by imposing undue and unconstitutional mandates on interstate commerce,” explained NPRA Pres. Charles T. Drevna.

The standard also would have little or no impact on greenhouse gas emissions nationwide and would harm US energy security by discouraging use of Canadian crude oil and ethanol produced in the US Midwest, Drevna added.

He said, “The fuel prohibited from use in California will simply be used elsewhere, which will result in increasing overall GHG emissions as a result of less-stringent environmental standards in places where those fuels would ultimately be consumed.” GHG emissions also would climb from increased transportation distances, he said.

The American Trucking Associations, the Consumer Energy Alliance, and the Center for North American Energy Security joined NPRA in the lawsuit, which was filed in US District Court for California’s Eastern District in Fresno. The complaint also said the regulatory scheme discriminates in favor of California-produced fuels by assigning them lower carbon-intensity ratings because of shorter transportation distances to end users.

Recently took effect
California Gov. Arnold Scwarzenegger called for adoption of an LCFS in the state during his 2007 State of the State address to reduce GHG emissions from transportation fuels in the state by 10% by 2020. The California Air Resources Board adopted a regulation implementing such a standard on Apr. 23, 2009, but it did not officially become effective until the state’s administrative law office approved it in January.

Proponents have said the LCFS will diversify transportation fuels in the state, boost the market for alternative-fueled vehicles, and reduce GHG emissions there by 16 million tonnes by 2020. “The drive to force the market toward greater use of alternative fuels will be a boon to the state’s economy and public health,” CARB Chairwoman Mary D. Nichols said in April. “It reduces air pollution, creates new jobs, and continues California’s leadership against global warming.”

CNAES Executive Director Thomas Corcoran noted on Feb. 2 that the standard discourages reliance on fuels derived from Canadian oil sands and other nonconventional sources. “This is a slap in the face to our Canadian allies and others who are working hard to help us attain North American energy security,” Corcoran said.

ATA Vice-Pres. Rich Moskowitz added that the LCFS also would ban imports to California over fuels derived from oil shale in the US West or domestic coal supplies, which could be converted into transportation fuels. “Discouraging these fuels will simply increase costs while failing to prevent their export to and consumption by other nations,” he said.

CEA Vice-Pres. Michael Whatley, a former chief counsel for the US Senate Clean Air and Climate Change Subcommittee, said, “Perhaps it wasn’t the state’s intent, but as written, the California LCFS is an example of parochial protectionism run amok. This isn’t the type of protectionism that will benefit California consumers. It’s the type that will ensure sources of essential energy are harder to find in the future and much more expensive to purchase.”

Contact Nick Snow at nicks@pennwell.com.

Related Articles

Syncrude sees additional $260-400 million in possible budget cuts

02/02/2015 The estimate for capital expenditures has also been reduced to $451 million net to COS, which includes $104 million of remaining expenditures on ma...

Novel upgrading technology cuts diluent use, capital costs

02/02/2015 A novel bitumen upgrading process that decreases the amount of diluent required for pipeline transportation and reduces overall operating costs has...

BHI: Texas anchors 90-unit plunge in US rig count

01/30/2015 The US drilling rig count plunged 90 units—a majority of which were in Texas—to settle at 1,543 rigs working during the week ended Jan. 30, Baker H...

Oxy cuts capital budget by a third

01/30/2015 In the midst of falling oil prices, Occidental Petroleum Corp., Houston, expects to reduce its total capital spending for 2015 to $5.8 billion from...

Cenovus trims additional $700 million from capital budget

01/28/2015 Cenovus Energy Inc., Calgary, will defer $700 million in additional capital expenditures originally planned for 2015 until crude oil prices recover...

Pengrowth cuts capital spending due to declining oil prices

01/23/2015 The recent “rapid” decline in world oil prices is the main reason given by Pengrowth Energy Corp., Calgary, for setting its 2015 capital budget at ...

Syncrude files applications for Mildred Lake extensions

01/20/2015

Syncrude Canada Ltd. has filed applications with Alberta Energy Regulator for two extensions to the Mildred Lake oil sands production area.

Take that, Canada!

01/12/2015 Mexican President Enrique Pena Nieto needs a warning about how the US treats friends nowadays. On the day of his chummy, Dec. 6, 2014, meeting with...

Cenovus trims budget, slows oil sands work

12/22/2014 Cenovus Energy Inc., Calgary, is trimming its capital spending in response to falling crude prices and will slow development of some of its thermal...
White Papers

Pipeline Integrity: Best Practices to Prevent, Detect, and Mitigate Commodity Releases

Commodity releases can have catastrophic consequences, so ensuring pipeline integrity is crucial for p...
Sponsored by

AVEVA’s Digital Asset Approach - Defining a new era of collaboration in capital projects and asset operations

There is constant, intensive change in the capital projects and asset life cycle management. New chall...
Sponsored by

Transforming the Oil and Gas Industry with EPPM

With budgets in the billions, timelines spanning years, and life cycles extending over decades, oil an...
Sponsored by

Asset Decommissioning in Oil & Gas: Transforming Business

Asset intensive organizations like Oil and Gas have their own industry specific challenges when it com...
Sponsored by

Squeezing the Green: How to Cut Petroleum Downstream Costs and Optimize Processing Efficiencies with Enterprise Project Portfolio Management Solutions

As the downstream petroleum industry grapples with change in every sector and at every level, includin...
Sponsored by

7 Steps to Improve Oil & Gas Asset Decommissioning

Global competition and volatile markets are creating a challenging business climate for project based ...
Sponsored by

The impact of aging infrastructure in process manufacturing industries

Process manufacturing companies in the oil and gas, utilities, chemicals and natural resource industri...
Sponsored by

What is System Level Thermo-Fluid Analysis?

This paper will explain some of the fundamentals of System Level Thermo-Fluid Analysis and demonstrate...
Available Webcasts


Cognitive Solutions for Upstream Oil and Gas

When Fri, Jun 12, 2015

The oil & gas sector is under pressure on all sides. Reserves are limited and it’s becoming increasingly expensive to find and extract new resources. Margins are already being squeezed in an industry where one wrong decision can cost millions. Analyzing data used in energy exploration can save millions of dollars as we develop ways to predict where and how to extract the world’s massive energy reserves.

This session with IBM Subject Matter Experts will discuss how IBM Cognitive Solutions contribute to the oil and gas industry using predictive analytics and cognitive computing, as well as real time streaming for exploration and drilling.

register:WEBCAST


The Alternative Fuel Movement: Four Need-to-Know Excise Tax Complexities

When Thu, Jun 4, 2015

Discussion on how to approach, and ultimately embrace, the alternative fuel market by pulling back the veil on excise tax complexities. Taxes may be an aggravating part of daily operations, but their accuracy is crucial in your path towards business success.

register:WEBCAST



On Demand

Prevention, Detection and Mitigation of pipeline leaks in the modern world

Thu, Apr 30, 2015

Preventing, detecting and mitigating leaks or commodity releases from pipelines are a top priority for all pipeline companies. This presentation will look at various aspects related to preventing, detecting and mitigating pipeline commodity releases from a generic and conceptual point of view, while at the same time look at the variety of offerings available from Schneider Electric to meet some of the requirements associated with pipeline integrity management. 

register:WEBCAST


Global LNG: Adjusting to New Realities

Fri, Mar 20, 2015

Oil & Gas Journal’s March 20, 2015, webcast will look at how global LNG trade will be affected over the next 12-24 months by falling crude oil prices and changing patterns and pressures of demand. Will US LNG production play a role in balancing markets? Or will it add to a growing global oversupply of LNG for markets remote from easier natural gas supply? Will new buyers with marginal credit, smaller requirements, or great need for flexibility begin to look attractive to suppliers? How will high-cost, mega-projects in Australia respond to new construction cost trends?

register:WEBCAST


Careers at TOTAL

Careers at TOTAL - Videos

More than 600 job openings are now online, watch videos and learn more!

 

Click Here to Watch

Other Oil & Gas Industry Jobs

Search More Job Listings >>
Stay Connected