Up until this week, California state law directed certified waste recyclers to sell leaded Cathode Ray Tube (CRT) glass from the old clunkers back to CRT makers or smelters.

But now we’re down to just one CRT maker and it’s in India. Neuro-toxic leaded glass started piling up in warehouses or got illegally dumped. So, the Department of Toxic Substances Control (DTSC) just issued an “emergency rule.” Recyclers can go ahead and just take CRT glass to hazardous waste landfills located in some of the poorest, largely Latino, communities in the state.

Consumers buying TVs pay between six and ten dollars at the point of sale to fund a state program that pays recyclers to recycle. Now, we’ll be paying recyclers to dump more toxins into poor neighborhoods already suffering from high rates of pollution.

Granted, the DTSC had to do something. But this was not the right something. Exceptions to rules tend to become permanent. And can be abused. This rule should be immediately reversed. Recyclers are already paid to recycle. They can use some of that money to pay a little more for CRT processing. Eventually, the technology will take off and the price will come down. That’s how markets work.

Under California law, regulators are supposed to encourage new hazardous waste treatment technologies that reduce or eliminate the hazards to human health and the environment, where they can be practically utilized, to improve California’s economic and environmental well-being.

What the DTSC just did was the reverse. “This is knocking the legs out from under the industry that is developing the recycling technologies and making the capital investment,” said Jim Taggart, head of ECS Refining, the second-largest recycler in the country based in Stockton. The state should simply have kept its rules in place, he said. “It’s done by just not encouraging landfill.  You require recycling and the system takes care of it.”

ECS Refining is concentrating lead from CRT glass and selling it back to smelters. We need lead for new batteries. It’s selling glass to new customers from insulation to cement makers in other states. And the new technology can be adapted later to other materials as electronics advance.

The impetus for the emergency rule had to come from somewhere, said Taggart. “Possibly the waste industry or recyclers that stand to benefit from landfilling the glass.” Taggart says that unscrupulous recyclers could end up putting leaded glass in ordinary, unlined municipal landfills that charge much less to take waste. And waste management companies that own landfills stand to profit from the boom in business.

“We invested $10 million dollars into this technology,” he said. “What’s a hammer cost?” He said unscrupulous recyclers will just break up CRTs by hand, and throw what they think is harmless glass into cheap municipal landfills. But he says that glass will still contain toxic levels of lead that can leach into the environment. “The state won’t have any way to control that.  It doesn’t have people at every landfill.”

Instead, regulators should be huddling with California lawmakers to see what can be done to use a chunk of that steady stream of money from consumers for electronics recycling to encourage the new technology. And it doesn’t have to stop there. Sheila Davis, executive director of the Silicon Valley Toxics Coalition says we need a paradigm shift. “We think the HPs, Apples, and Dells should be paying to make sure this stuff is not dumped on poor people but taken back and recycled responsibly.”

California might just want to join the 21st century and pass, like 23 other states have done, an Extended Producer Responsibility Law that makes electronics manufacturers that design, produce or sell a product minimize its environmental impact throughout its life cycle.

We’d shift away from charging consumers a recycling fee and have the manufacturer build the cost into product for its dismantling and recycling. That would be quite an incentive to figure out how to make products that are less toxic and easier to dispose of  in the first place.

Instead, this DTSC is helping to sully the present and landfill the future.

The San Francisco Chronicle reported details of that excruciating delay Wednesday morning, along with very different accounts of why it happened. The plant’s emergency response managers vaguely said they saw the leak as too minor–just “20 drops a minute” at first, to trigger an emergency or notify anyone. Until, of course, it suddenly got bigger and exploded into a blaze. But workers on the ground saw it differently and told their story to their union’s safety experts:

“From the time they did see the leak, they debated what to do,” said Kim Nibarger, who has investigated refinery accidents nationwide. “It was not so much whether to fix the leak, it was about what could they do to keep the line running and get it fixed.”
Nibarger based his opinion on Monday’s incident after discussions with union representatives at the refinery. The choice, he said, should have been clear.
“When you have hydrocarbons outside the pipe, you are no longer running at a normal condition. It’s time to shut the thing off and fix it, not to try to figure out a way around it.“

The last big fire at the Chevron Richmond refinery, in 2007, started the same way: a leak in the same refining unit, No. 4. Two employees were injured and the refinery was shut for months.

What one local resident said in 2007 sounds like it was today:

“Once those [emergency] sirens sound, you are supposed to shelter in place,” [the resident] said. “That means nobody goes to work, nobody comes to work in the west end of Richmond and no schools open. The cost of that is incredible.”

The costs of shutting down a refining unit to be on the safe side are nothing compared to the costs of shutting down a community, of treating respiratory crises at the emergency room, of higher child asthma rates.

Motorists will also pay. San Francisco and Los Angeles wholesale gasoline prices jumped 30 cents a gallon overnight following Monday’s fire. If recent history is any guide, other West Coast refiners will just grab the extra profit rather than raising production to keep supplies up and prices down. That’s exactly what happened after a major refinery accident in Washington State last year, according to a study commissioned by Sen. Maria Cantwell.

So all Californians will pay something for Chevron’s attempt to keep Unit 4 running even though its own emergency response team knew about the leak.

Safety procedures are also at issue in Chevron’s offshore drilling near Brazil, where 155,000 gallons of oil leaked from undersea cracks. Brazil last month accused Chevron of failing to follow its own procedural manual and dismissing troubling test results when it started production from the well. Chevron is also continuing to pay its lawyers millions of dollars to avoid paying damages to Ecuadoran peasants whose land was ruined by Texaco, which is now part of Chevron.

Chevron is not alone in this mindset.

BP ignored safety and quality questions about sealing cement used to cap a deep offshore well in the Gulf of Mexico two years ago, when it could have ordered the cement contractor, Halliburton, to start over (meaning at least a few days of delay). We all know how well that went. BP also skimped on maintenance and ignored corrosion of its Alaska pipeline near Prudhoe Bay in a 2006 spill of 200,000 gallons that shut down the pipeline. Exxon let a known drunk pilot its giant oil tanker, the Exxon Valdez.

It’s a long list. But the common thread is that safety is not a profit center for the oil industry and every penny spent on safety dings the bottom line. Until, of course, cleaning up the mess costs millions or billions.

Santa Monica, CA — Monday night’s explosion and hours-long fire at Chevron’s large oil refinery in Richmond, Ca., released toxic chemicals including sulfur dioxide and nitrogen oxide in unknown amounts, sending hundreds of local residents to local hospitals with breathing and eye complaints. Yet the state agency with the most expertise in regulating such toxins, the Department of Toxic Substances Control, claims it has little to no oversight of dangerous substances produced in refinery accidents, said Consumer Watchdog.

“The Department of Toxic Substances Control regulates hazardous waste in the state of California,” said consumer advocate Liza Tucker.  “And there isn’t a single refinery that doesn’t produce or store hazardous waste.”  Instead, the DTSC limits itself to regulating around 80 hazardous waste facilities that specifically process hazardous waste. It only oversees hazardous waste storage at refineries.  Even recyclers of used motor oil are not subject to its purview if an accident involves certified recycled oil.

Consumer Watchdog called on the State Attorney General to investigate the failure of the state to adequately supervise hazardous refineries and their toxic emissions in the wake of a series of recent refinery fires, including Chevron and Evergreen Oil.

Refinery oversight is distributed among city and county fire and health agencies, the state Air Quality Management Districts, California Occupational Safety and Health Agency, various water agencies, Cal-EPA and more.  The state Department of Toxic Substances Control has declined to seek authority over toxins produced by refineries, even though their large-scale toxic releases can put far more residents in immediate danger than a toxic waste collector or recycler, said Consumer Watchdog.

The Monday fire at Chevron was a near duplicate of a 1999 incident at the Richmond refinery that involved multiple explosions and fires and sickened an even larger number of residents. A smaller 2007 fire was, like Monday’s explosion, apparently triggered by a pipe leak and shut down the entire refinery for a few months at the beginning of the year.

See account of 1999 fire here: http://www.sfgate.com/bayarea/article/Huge-Explosion-Rocks-Richmond-Oil-Refinery-2939736.php#page-1

“Chevron glibly blames environmentalists and local residents for blocking plant expansions, but refuses blame for failing to make its refinery, in the middle of the densely populated Bay Area, as safe as it could be,” said Tucker, an advocate at Consumer Watchdog. “State regulators make such evasion easy by passing the buck to other state and local agencies.  And now what we’re seeing is regulation by crisis. Huge corporations just aren’t going to bother to be in safety compliance when they don’t fear real accountability.”

Fourteen years ago, the Board of Supervisors passed the Contra Costa County Industrial Safety Ordinance. It mandates seven large refiners and chemical companies, including Chevron, develop stringent safety programs to prevent chemical releases and accidents as a supplement to existing federal and state programs.  As a result, there have been fewer releases and chemical accidents over the past decade. “Not every county can afford to enforce this kind of a program,” said Tucker.  “Oil refineries have lots of moving parts and the state should be doing unified regulation but has repeatedly failed to do so.”

See ordinance here: http://cchealth.org/groups/hazmat/industrial_safety_ordinance.php

Effect On Gas Prices

There is toxic fallout of a different sort from today’s Chevron fire.  Gas prices in California could spike by 10 to 20 cents a gallon, depending on how many crude processing units Chevron shuts down, according to commercial petroleum analysts.

See Bloomberg here: http://www.bloomberg.com/news/2012-08-07/chevron-refinery-fire-may-push-california-gasoline-higher-1-.html

Gas prices in California are higher than in the rest of the nation in any case due to California’s isolation in the national refinery market.  “We are hostages to our own refineries,” said Tucker.  “And the oil industry consistently manipulates gasoline supplies on hand to keep prices higher.”  California historically has had about 10 fewer days of supply on hand than the rest of the nation, even though its isolation should require more days of supply on hand.

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The latest from Greenpeace’s “ArcticReady.com” has Shell offering the public a chance to save  one favorite species of marine mammal from excess harassment by drillers, boats, spills, noise and general habitat destruction. Go ahead. You can pick Orcas or another endangered whale species. Maybe harbor porpoises? Seals? Remember, in this “Let’s Go: Mercy Poll,” only one species can win!

The spoof  has a basis in reality: the issuance of federal “incidental harassment” permits to Shell for its risky Arctic oil project, acknowledging that you can’t drill in the wild without doing damage to its wildlife. Even endangered wildlife. It’s obviously not the kind of victory that the real Shell celebrates in a news release.

Greenpeace also ran an online “Shell ad contest” and posted the winner, “You Can’t Run Your SUV on “Cute,” on a billboard in Houston, Shell’s U.S. home base.

Shell’s current project is getting the U.S. Coast Guard to weaken its safety requirements on the spill-containment barge that apparently can’t meet Shell’s original promise–the origin of the phrase “Arctic ready that it would withstand a 100-year storm. Shell wants it downgraded to “10-year-storm-ready.”

Now, with much of the nation suffering from record drought, citizen awareness is rising. California has no water to spare even in good years and global warming is expected to continue to constrict the region’s clean water sources for people and crops. And no state agency is even measuring how much fresh water is lost to oil and gas drilling, or regulating any part of fracking or water “injection” in oil wells. A report by the Environmental Working Group details the complete failure of regulators, who until recently barely acknowledged that fracking exists in California. Regarding water risks, the report said:

[T]he state has never assessed fracking’s risks to California’s groundwater. In [a] 2011 letter, Sen. Fran Pavley asked the division to “provide the results of any risk assessments that the State of California has conducted regarding potential groundwater contamination associated with hydraulic fracturing.” The agency responded: “The division does not know of any state risk assessment regarding potential groundwater contamination associated with hydraulic fracture.”

Beyond actual hydraulic fracturing, California drillers including Chevron,and the Shell/Exxon subsidiary called Aera Energy also use millions of gallons of water for steam injection that heats sludgy “heavy oil” to pull more out of older wells. A few things state regulators should have known:

• Oil operators in California’s Central Valley, which use more than 300 gallons of water for every barrel of oil they reap, get all the water they want in drought years from he state’s irrigation system while farmers have to let thousands of acres go dry (See more on this in a report from Circle of Blue, a scientist/journalist group that tracks endangered natural reseources worldwide)
• The total of irrigation water received yearly by California drillers is 8.4 billion gallons, also from the Circle of Blue report, which merely consulted state water agencies.
• Much injection-well water could be recycled for agriculture but largely is not because it costs more than disposal by injecting the waste in deep wells (which themselves have caused earthquakes, but that’s another story).
• A Central Valley farmer sued Aera Energy in 2001–and won–for polluting the farm’s underground aquifer with oil well wastewater (a fight over punitive damages is still going on).

California’s Legislature and its chief regulator, after a barrage of bad publicity, are finally talking about regulating fracking and injection wells. One new bill would put a moratorium on fracking until actual regulation of drilling and chemical use is in place. But recent history on the issue is not encouraging.

• Gov. Jerry Brown, for instance, fired his top oil and gas regulators last December at the behest of the Western States Petroleum Association (i.e. Chevron, Aera Energy, Occidental Petroleum). The companies objected to tougher scrutiny of injection wells following the death of an oilfield worker in a boiling pit of wastewater at a Chevron injection field.
• State Sen.  ichael Rubio, a key Democrat on the state Senate energy committee,said he very much agreed with Brown’s actions.
• State Sen. Fran Pavley this year introduced a bill that would simply notify local residents of planned fracking activity. No regulation involved, just notification. That bill died in the state Senate under a withering barrageof lobbying by WSPA. Several Democrats including Rubio failed to vote on the bill, dooming as completely as a “no” vote, without taking any responsibility.

So California is late to the game on wondering what the oil industry is doing with its water, but at least now it’s not an issue hiding on the back pages of non-regulators at the state Division of OIl, Gas and Geothermal Resources. That’s DOGGR, which must mean dog with no bite.

Santa Monica, CA — Consumer Watchdog called on the Director of the California Department of Toxic Substances Control, Debbie Raphael, to indefinitely close the Evergreen Oil waste-oil re-refinery in Newark, Ca. in a letter sent today.  On July 6, a pipe leak spewed “superheated oil” and triggered an emergency evacuation of the facility.  The company and Newark police warned the surrounding community, including a nearby elementary school, to expect a wave of “strong odors” from the leak.

Read today’s letter to Raphael here:  http://www.consumerwatchdog.org/resources/evergreenltrraphael7-16-12.pdf

Consumer Watchdog cited repeated problems at the facility as an example of DTSC’s failure to take tough action against toxic industries that continue to operate after repeated safety violations near homes and schools in testimony and a letter presented at Debbie Raphael’s State Senate confirmation hearings in April.

The confirmation letter said several companies, including Evergreen, “appear to have manipulated or ignored the DTSC and other agencies to the detriment of concerned and frustrated local residents.”

The accident marks the latest in a string of problems at the plant that re-refines used motor oil, including a burst pipe and major fire in March 2011 and repeated citations by the DTSC for safety violations and carelessness.

“Consumer Watchdog is appalled to learn of yet another accident at the Newark-based used oil recycler Evergreen Oil,” said Liza Tucker, an advocate at Consumer Watchdog.  “We call on the DTSC to shut this refinery down indefinitely.   Evergreen needs to know that sloppy safety procedures, and refusal to fix or replace shoddy infrastructure, is simply unacceptable.”

The DTSC has let the company off the hook with consent decrees and hand-slap fines for at least a dozen years, said Consumer Watchdog.  The group called for the new leadership at the DTSC to send toxic industries a strong message that there is a new sheriff in town who won’t allow careless endangerment.

The letter sent today to Director Raphael said in part:

“Your department has repeatedly cited Evergreen Oil for cracks and gaps in waste container storage and transfer areas, failing to track contaminated petroleum waste coming in and out of the facility, careless soil contamination, and omissions in its own inspection system.

“Still, the DTSC fined this company that generates some $36 million in annual revenues less than $60,000 under six separate consent decrees between 2006 and 2011.  This practice of accepting promises that Evergreen will police itself, instead of taking the company to court, has been an abject failure. The DTSC has cited the company for failure to follow even its own simple safety procedures.

“At the same time, members of the local community say that for 25 years Evergreen has ignored federal and state laws and polluted their neighborhoods.”

The department has a special responsibility to working and middle class families in the small cities where companies produce and recycle toxics including PCBs, dioxin, and heavy metals near homes and schools, Consumer Watchdog said.  Too many of these companies have mastered the arts of delay to avoid fixing leaks, improving infrastructure, and following adequate internal safety controls.

“Evergreen Oil has proven repeatedly that it cannot be trusted,” said Tucker.  “The DTSC and other regulators need to put community safety first and show zero tolerance for such polluters.”

Consumer Watchdog has previously described problems at several hazardous waste sites, and also called for reforms at the DTSC to address a lack of transparency, a disconnect between inspection and enforcement, and a preference for weak settlements instead of more aggressive prosecution of serial violators.

Read Letter to Director Raphael at: http://www.consumerwatchdog.org/resources/evergreenltrraphael7-16-12.pdf

Also read Consumer Watchdog’s April 9 letter to the Senate Judiciary Committee at: http://www.consumerwatchdog.org/resources/final_ltr_senate_rules_dtsc_040911.pdf

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We’ve known for years that California and West Coast refiners find endless ways to shut down some of their gasoline production, cutting supplies and jacking up  pump prices.  They actually make more money from making and selling less gasoline. It explains why West Coast drivers are stuck paying $4-plus a gallon while pump prices take a dive in the rest of the country. Now a credible study and a U.S. Senator have reached the same conclusion–and trying to put some muscle on the oil industry.

Washington State Sen. Maria Cantwell is probably the best-informed on the petroleum industry of all federal legislators, at least among those not joined at the hip with Exxon. She is calling on the  the Federal Trade Commission to investigate six major refiners–Alon, Chevron, ConocoPhillips, Shell, Tesoro and BP.  It’s a smart move, because the oil lobby has a stranglehold on Congress and most state legislatures. President Obama has tried at least twice to reduce the industry’s billions of dollars in taxpayer subsidies, and gotten nowhere.

Here’s the gist of the story by McClatchy news service’s Kevin Hall:

In a letter being sent to regulators on Thursday and obtained by McClatchy, Sen. Maria Cantwell, D-Wash., calls on the Federal Trade Commission to investigate refinery operators Alon, Chevron, ConocoPhillips, Shell, Tesoro and BP following the shutdown of BP’s Cherry Point refinery in Washington State.

Citing a report by Portland energy consultant McCullough Research – a group whose work helped topple energy-trading giant Enron Corp. – Cantwell questioned why May gasoline prices in her state soared recently to within cents of the local record of $4.35 a gallon set in July 2008. Meantime, gasoline prices nationwide in May fell 17 cents a gallon and oil tumbled more than $14 a barrel.

The McCullough Research report questioned whether the historically low gasoline inventories on the West Coast were really a result of a fire on Feb. 17 that idled the BP plant for about three months.

Gasoline prices on the West Coast had tracked closely with the price of West Texas intermediate crude delivered at Cushing, Okla., but in May veered widely from historical norms, according to the report. Had prices followed supply costs, said the report’s author, Robert McCullough, retail gasoline prices on the West Coast would have dropped to about $3.65 a gallon. Instead, prices have been about 68 cents higher.

The report estimates “a windfall profit of $43 million a day” for refiners on the West Coast as the supply manipulation continues.

Here’s the full report from McCullough Research, and the news release from Sen. Cantwell’s office, with her letter to the FTC attached. She requests the FTC to:

…utilize its regulatory authority and responsibility granted by Congress to ensure that Washington state consumers are not subject to “any manipulative or deceptive device or contrivance” that could be resulting in unjustifiably high gasoline prices.  In particular, I am asking the Commission, pursuant to the Prohibition on Market Manipulation Rule, to investigate whether or not recent and inexplicable gas price spikes in Washington state are the result of deliberat[e] efforts by West Coast refiners to keep gasoline inventories artificially low.

This is a fight that’s been going on for a long time and California is even more affected by what the refineries are doing. Cantwell would no doubt welcome some company in her effort from Sens. Dianne Feinstein and Barbara Boxer.

What gives? As usual, it’s the refineries. There are only 12 refineries supplying gasoline in the state, according to the California Energy Commission. Several of them are fully or partly shut down, for repairs or “scheduled maintenance” or just because the owner thinks refining gasoline is temporarily not profitable enough. This restriction in the state’s gasoline supply can go on for as long as refineries wish–the state has no authority to demand that scheduled maintenance be more rationally planned or efficiently conducted, or to investigate whether a plant owner is playing games with our pocketbooks.

The bottom line is that California, because it’s not on any major gasoline pipeline network, can’t bring in supplies to counter refinery shutdowns, is stuck with whatever shortage-induced gasoline price the refineries want to impose. If they can make up on profit what they lose on production, it’s just dandy for their bottom line. The extra profit that refineries generally make in California even has a name in the industry: “West Coast Premium.”

According to a 2009 investor report  by the Texas-based refiner Tesoro, West Coast refineries have an average margin that is $8.50 per barrel higher than those operating on the Gulf Coast.

Given the power that refiners’ restrictions of gasoline supply have on gasoline prices, the state should have more regulatory power over refinery operations, modeled on regulation of power companies. The refiners would be guaranteed a modest but steady profit, and would in return have to guarantee a steady, reliable gasoline and diesel fuel supply. The new oversight would be more than paid for with a modest extraction tax on oil drilled in California–something every other oil-producing state enacted long ago.

Another conclusion from  current gasoline prices in the state is that drilling more in California–off the coast, in deep shale, or by using dangerous superhot steam to wring more from old oilfields–won’t lower pump prices by a penny. Oil prices are going down now because speculators finally had to admit that there is no shortage of oil in the U.S. or in the world, but California drivers haven’t seen a penny of benefit.

California, even if it could produce every drop of oil that the state uses, would still be largely at the mercy of refiners.

Gas prices have soared about 15% in the last six months, hitting $3.94 a gallon average nationwide, and $4.29 in California.

The mood of motorists? Meh.

Partisan finger-pointing aside, polls suggest that most people aren’t as worked up over gas prices as they were four years ago, when a gallon of regular hit a national average of $4.11 a gallon. Nor has there been as much clamor for drastic measures, such as tapping the Strategic Petroleum Reserve in Texas and Louisiana.

“I think we all have adjusted,” said Lara Clayton of Los Alamitos as she spent nearly $60 recently to fill up her 2008 Lincoln Town Car at a Seal Beach 76 station. “We just don’t drive as much and we are careful to combine errands.”

That’s one reason for the comparative complacency, and economists and industry observers say there are others.

A big factor is that the current run-up in fuel prices has been nowhere near as steep as in 2008, when prices escalated 35% in six months.

Having already seen prices cross the $4 barrier, motorists are less likely to become outraged when they see it happen again, said Michael Sivak, who heads the University of Michigan’s Transportation Research Institute. And because the costs of other items have risen — notably food — it stands out less as a household budget buster.

“If we adjust for inflation, gas costing $4 a gallon now is analogous to gas costing $3.72 four years ago,” Sivak said.

Another factor is that more people are driving fuel-efficient cars, as older gas-guzzlers are gradually replaced with new vehicles that get better mileage.

Auto sales figures this week demonstrate that trend. Through the first three months of the year, sales of small cars accounted for 27% of retail car sales, said research firm J.D. Power & Associates. Toyota sold a record 29,000 of its Prius hybrids last month, making it the sixth-most popular vehicle in March. More than 40% of the vehicles General Motors sold last month had the smaller four-cylinder engines, a company record.

With more hybrids and four-cylinder engines in the mix, the vehicles sold in February 2012 get nearly 17% better mileage than those purchased in February 2008, Sivak said.

One reflection of that is evident in figures from the U.S. Energy Information Administration and the Federal Highway Administration. Americans drove just 1% fewer miles last year compared with 2010, but the nation used 3% less motor fuel.

That may help explain the results of a recent Washington Post poll. Asked whether “recent price increases in gasoline caused any financial hardship for you or others in your household,” 63% of the respondents said yes. That’s well below the 77% that answered yes during the price surge of 2008, and it was the lowest affirmative response to the same question in five years.

Still, Americans are feeling the pain, and if prices cross the $5-a-gallon line, there could be a lot more furor. Gallup polled drivers last month and found that about 14% said that even gas priced under $4 a gallon forced them to make lifestyle choices. And 28% said a price point in the $4 range caused them to reduce spending in other areas.

But the tipping point comes above $5, at which level 76% say they would start changing spending habits. With the national average for regular gasoline still under $4 a gallon, Gallup said its data suggest that “there is room for a considerably greater increase in gas prices before Americans say prices will begin to have widespread, serious consequences on their spending and lifestyle patterns.”

During previous surges, high gas prices ate into sales at fast-food restaurants and discount retailers such as Wal-Mart and Dollar General.

Back in 2005, when California gas prices were in the low-to-mid-$2 range, both consumers and politicians were more vociferous with their complaints, especially in California, where, because of refinery and fuel blend issues, prices are higher than in other regions. The House Oversight and Government Reform subcommittee on energy and resources even held hearings in Long Beach.

In 2006, the Federal Trade Commission launched an investigation to look at whether rising gas prices were the result of antitrust violations by oil companies or refiners. It eventually concluded that the increases were based on supply and market conditions.

That same year, the California Energy Commission launched its own investigation, eventually finding that unplanned refinery outages, unusually high fuel exports and tanker troubles — not misdeeds by the oil industry — were the primary drivers behind a springtime price surge.

As prices soared in 2007, state attorneys general jumped into the fray. Florida’s Bill McCollum said his office was looking at more than 200 complaints about price gouging at gas stations. That same year, the House approved a bill that made gasoline price gouging a federal offense.

This year, motorists are essentially saying, “We survived and moved on,” said Jeff Spring of the Automobile Club of Southern California, which closely follows fuel prices.

Activist Jamie Court, president of Consumer Watchdog in Santa Monica, calls it “capitulation.”

“After you get bonked on the head by $4 and $5 gasoline enough times, maybe it doesn’t hurt as much,” Court said.

Yet Court said he believes there’s still plenty of consumer angst bubbling under the outward signs of resignation, and that the public still views oil companies and their executives with disdain.

Long Beach City College education teacher Lee Douglas copes by filling his car every time the tank dips below half. The tab doesn’t feel as bad that way, Douglas said as he pumped $40 worth of gas into his Buick LaCrosse in Seal Beach.

“We have gotten to a point of acceptance,” he said, “whether we like it or not.”
————–
Contact the author at: jerry.hirsch@latimes.com

California refineries “emit 19–33% more greenhouse gases (GHG) per barrel [of crude oil] refined than those in any other major U.S. refining region,” according to a recent report for the Union of Concerned Scientists. The reason is a corresponding increase in the amount of heavier, dirtier crude oil processed, including dark, sticky tar sands oil from Canada. The gasoline produced at the end of the process is no dirtier–but the gases that could otherwise come from your tailpipe are going up the refinery smokestack instead.

A story in Inside Climate Today points to requirements that refiners remove sulfur pollutants from gasoline and diesel fuels. Such scrubbing is harder to do with the cheaper, dirtier tar oil, and refiners may emit more carbon pollutants during a longer refining process, especially as they try to squeeze out more  fuel from every barrel of oil.

California isn’t yet capping refiinery pollution, and this week delayed putting financial teeth in planned emission caps. Pardon us for thinking oil industry lobbying could have had something to do with it.

No one is forcing refiners to buy Canadian tar oil–refiners want because it’s cheaper than lighter oils and produces a bigger profit. It’s the same reason oil companies are demanding their high-volume Keystone XL pipeline from Canada to Texas, which could make California refinery pollution look like a clear day in spring. Exxon Mobil officials won’t even admit that the tar oil is dirtier to refine. From a Texas story on the pipeline:

An ExxonMobil spokesperson refused to specify how much heavy crude the company’s refineries are already processing in Texas or might process if the pipeline is completed. Nor would the company respond to questions about how refining tar sands oil affects the amount of air pollution created by the plants.

Extra profit also comes from U.S. refiners exporting gasoline and diesel fuel at record rates. Fuel is now America’s top export, even as refiners import the dirtiest oil to make it.  Domestic pump prices go up and the refinery pollution burden on Americans goes up while other nations reap the clean fuel.

Californians are already buying and driving cleaner cars and cutting consumption. All families prize clean air, but those who live near refineries are suffering more, not less, pollution.  There’s “gas pain” for everyone except the oil industry and its servants in government, as in a Congress that won’t even trim the industry’s billions in corporate welfare.

Between the quakes, serious drinking water pollution and permanent damage to land around “fracking” wells (so named because they fracture deep rock to release natural gas), even Exxon can’t argue that this sort of natural gas is perfectly safe and clean. Injecting it into bedrock rock faults is out, killing wildlife brings bad PR and pouring it into our drinking water is increasingly frowned on.

I’m no geologist, but making a mess should have consequences for the people who made it. So here’s my top 10 list:

Proper Use of Fracking Wastewater

10. Spray it on the lawns of the oil and drilling executives who commit fracking

9. Fill the swimming pools of state elected officials (for instance Pennsylvania and Wyoming) who let oil companies frack  for years without even disclosing the chemicals they used.

8. Make interestingly colored ice cubes for the refreshment tables at oil company corporate retreats and shareholder meetings.

7. Fill thousands of tanker trucks and park them at the corporate headquarters, vacation properties, investment properties and home driveways of all of the above executives and state and federal politicians.

6. Water the playing fields of NFL and college teams that indirectly made millions from Exxon TV ads about clean, safe and cheap natural gas from fracking.

5. Fill the water coolers of members of Congress who are laboring to eradicate the Environmental Protection Agency and its “job-killing” air and water safety regulation.

4. Hack the Netflix accounts of the same members of Congress so the only offering is the movie “Idiocracy.” Send refreshing “Frack Snack” bottles with the movie. (Spoiler alert: It no longer seems farfetched that corporate political influence would lead to watering farms fields with taxpayer-financed Gatorade-ish sports drinks.)

3.  Top up the debate podium water glasses of presidential candidates who see “drill, baby, drill” as the best energy solution.

2. Turn drilling-site wastewater holding ponds into docks for the sailboats and pleasure yachts of the political and corporate fans of fracking.

1. Make Jell-O salad for every oil and drilling company headquarters cafeteria.

Maybe it’s just a drop in the disposal bucket, but at least the toxic water would be going to the proper places.

The price of gasoline in the U.S. set a full-year record in 2011, swiping $4,155 from the average family pocketbook, more than 8% of family earnings. Last year’s payroll tax cut that was supposed to stimulate the economy went largely to the pockets of OPEC, Exxon and friends.

Given the 4% jump in crude oil prices on Tuesday, the first trading day of the new year, 2012 looks like it could be even worse. What’s most shocking, however, is that effective government could put a stop to the price roller-coaster.

The news stories, parroting the financial analysts, blamed the mini-”Iran crisis” and economic growth in China, India and the U.S. for the oil price spike. But the truth is that Iran’s saber-rattling is nothing new and on-and-off embargos have already diminished the importance of Iranian oil in world markets. Just a week ago, oil prices fell slightly when the same analysts proclaimed Iran’s actions as “empty threats.”

Another truth is that growth in the U.S. and Asia is offset by the economic mess in Europe, where economies have shrunk and the risk of full economic meltdown persists. So worldwide oil demand is expected to be flat in 2012, and U.S. crude oil supplies are still well above what they were before the 2008 economic meltdown, according to U.S. Energy Information Administration data.

There is absolutely no supply and demand reason for crude oil prices to spike above $100 a barrel, or for families to fork over 8.4% of their income on gasoline to get to a worse-paying job than they had three years ago. The real reason remains speculation in oil markets, and a government so beholden to financial and corporate powers that it can’t respond in any effective way.

From London’s Guardian newspaper:

BP’s attempt to rebuild its public image after the worst oil spill in US history has been dealt a blow by court documents showing it was willing to do a major deal with Russian billionaires whom it regarded as “crooks and thugs” to gain access to the country’s vast oil wealth.

The damaging allegations have come to light at a critical time for BP, which faces a criminal investigation by the US justice department while preparing to fight a massive legal case in New Orleans over the Gulf of Mexico oil spill.

North American rival Norex Petroleum is seeking $1bn damages in its case at the New York supreme court as it argues that BP and its Russian business partner, TNK, have benefited from oil assets that were seized [by TNK] in the late 1990s. Russia is important to BP – its joint-venture, TNK-BP, produces a quarter of its oil. At the heart of the dispute is the alleged misappropriation of the Yugraneft oilfield in Siberia, which Norex claims has generated $1bn in oil revenues in the past decade.

In 2003, BP announced a $6.75bn (£4.2bn) deal to acquire a 50% holding in Tyumen Oil – TNK – which was backed by Alfa Access Renova (AAR), a consortium controlled by four of the country’s richest businessmen, Mikhail Fridman, German Khan, Leonard Blavatnik and Viktor Vekselberg.

Of course, there are precious few businesses that think investing in Russia’s private sector is a safe or good idea, and a new book by a British reporter tells the whole Russian privatization story in its title, “Mafia State.” But for BP, the smell of oil overcame the stench of corruption.

It’ll be interesting to see how BP frames its defense. BP’s lawyers can’t just say that executives knew the Russians were crooks but their need for new oil was greater than their scruples–not while facing a Justice Department criminal investigation that has reportedly reached the the grand jury stage (according to a July 2011 SEC filing by Halliburton)–and could indict individuals as well as the company.

The ongoing criminal investigation and BP’s cavalier corporate scruples in the Russian deal ought to raise some sharp questions in the White House about its decision last month to let BP resume drilling in the Gulf of Mexico–in even deeper waters than the location of the 2010 spill.

Cooper says:

By building on analyses and testimony offered by the Consumer Federation of America during the rapid expansion of oil commodity market trading and the escalation of price in the mid-2000s, the paper shows that excessive speculation, not market fundamentals caused the spike in oil prices. The movement of trading and prices in the three years since the speculative bubble in oil burst in 2008 provides even stronger evidence that excessive speculation is a major problem that afflicts the oil market and the economy. …

Failing to provide effective oversight of speculation, policy makers allowed the enrichment of Wall Street speculators through financialization of commodities like oil, at the expense of the real economy on Main Street.

The Consumer Fed study concludes that the gambling of market speculators adds about $30 to the average price of a 42-gallon barrel of oil, now hovering near $85 in the U.S. That translates to nearly $1 a gallon, once  refining and financial carrying costs are added in. Think what the costs are to truckers, railroads and airlines, as well as farmers and manufacturers.

Yet our regulators, specifically the federal Commodity Futures Trading Commission, have been so cowed by financial lobbyists that they have endlessly delayed  regulations that would begin to halt excessive speculation. A vote on key regulations is scheduled for Tuesday Oct. 18, and the 5-member CFTC board now reportedly has three votes to pass them.

Main Street can’t wait much longer.

Their claim that they ensure compliance with all “applicable environmental and safety regulations” is my personal turning point, because in the U.S. those regulation barely exist. It’s easy to comply with nothing, so Exxon can get away with telling us that fracturing bedrock thousands of feet deep, drilling through the aquifers that supply our drinking water, using scarce water supplies spiked with an unidentified slew of toxic chemicals, is as safe as braiding a a daisy chain.

Some other countries, however, are starting to act on their doubts.

France has outlawed this drilling, known as “fracking,” until doubts about what it does to water supplies and how its waste poisons the land are dealt with. Britain’s Advertising Standards Authority banned one of the Exxon ads, stating that its claim on liquefied natural gas as one of the world’s cleanest fuels is misleading.

In the U.S., enviro and consumer groups grumble, and SolarDave has made an on-target spoof of the Exxon ads, but our lawmakers and regulators are still mostly twiddling their thumbs. There isn’t a federal requirement that drillers tell us what chemicals they’re squirting into the ground, or a law to prevent dumping their wastewater into the rivers from which we drink.

After a slew of investigative reporting (special kudos to ProPublica) on the health and environmental fallout from fracking, government is starting to ask questions. This week, Sen. Jeff Bingaman of New Mexico led off a Senate Energy and Commerce hearing on fracking, ticking off the water issues, land poisoning and air pollution issues, and adding on fracking’s release of highly potent climate-change gases, particularly methane. But a show of sympathy is a long, long way from effective regulation.

Fracking waste pit

Pennsylvania, where some of the most egregious fracking complaints are centered, and four other states are now requiring some disclosure of drilling chemicals, but not regulating them.

California is even more pathetic. The state agency that is supposed to regulate natural gas says it doesn’t  know how many fracking operations the state has, if any, or where they’re located (even though industry sources identify at least seven locations around Bakersfield).  A bill to require identification of the wells and the chemicals they’re using failed to pass the Legislature this year. The reason, as stated by one of the negotiators on the bill a few weeks before it died, was that the oil and gas industry wasn’t completely satisfied with it:

[T]he bill’s ultimate chance of passage… could hinge on getting the state’s oil and gas producers completely on board to back the legislation, but as of yet, the bill’s sponsors still have not come to a complete agreement with the … industry on several issues.

So it boils down to this: In the U.S., what the oil industry wants too often trumps the needs of citizens and the health of the environment. it’s never been more clear than with fracking.