Five Things Californians Should Be Thankful for This Thanksgiving

As Californians, most of us realize that we have it pretty good. We have beautiful beaches, mountains and canyons. We have glorious National Parks, some of the nation’s leading research universities, and we are the epicenter of the high tech and entertainment industries.  And, yes, while much of the country is freezing its way through another Polar Vortex, most of us would find winter daytime temperatures in the 50s uncomfortably low.

We are also home to one of the major economic — and environmental — success stories around: California’s robust oil and gas industry. Much of the industry’s activity takes place far from the Golden Gate Bridge, Silicon Valley, Mickey Mouse and the California that most Americans see on their televisions (although if you keep your eyes open there is significant development in and around greater Los Angeles). In fact, the oil and gas industry that has been part the fabric of our state since the first commercial oil well was drilled in Humbolt County back in 1865

So, to commemorate this Thanksgiving, here are five things that Californians should be thankful for that they might not think about every day:

1) We have the nation’s strictest environmental regulations and a thriving business environment. In California we have a long tradition of embracing reasonable and sensible regulation aimed at protecting the health and safety of our citizens. To be sure, California has been home to some far-out and excessive regulatory schemes, both proposed and enacted, and even today, energy and other industries have to fight the confiscatory dreams of some of our less reality-based legislators. For the most part, however, there is bipartisan pride in a state that is one of the major economies on the planet and is leading the way in lowering carbon emissions, and protecting our natural resources.

No better example can be found than SB 4, our extensive regulations on hydraulic fracturing. Though “fracking” is a routine and well-understood practice that federal and state regulators, as well as academic experts, confirm had caused none of the adverse impact that radical environmentalists claim, nevertheless a bill was passed and signed by Governor Jerry Brown – himself one of the leading environmental leaders of the past 40 years – that addressed the concerns of environmentalists (and the public that they had frightened) while still being grounded in science. That means that there was explicitly no ban or moratorium on fracking put into place. So, industry will have to comply with many more regulations, some of which it supported and some of which it didn’t, but it will continue to thrive in the Golden State.

A related example is also telling: two bills to put a moratorium on hydraulic fracturing, one voted on during the SB 4 session and one subsequent to it, went down to crushing defeat at the hands of not only Republicans, but many Democrats – who control all of state government — as well.

In fact, Governor Brown – who relies upon the votes of environmentalists – was so focused on sound science in the SB 4 debate that he declared that anti-fracking activists “don’t know what the hell they’re talking about.” This is refreshing when so much of American politics seems to be about scoring partisan points.

2) More production in California is good for the environment and for our economy. Many don’t realize that California uses every drop of oil that we produce in the state, and then some. In fact, we import half of the oil that we use by ship and by rail. Not only does importing oil have its own environmental footprint, and risks, but this imported oil is produced in places like Venezuela and Saudi Arabia – places with much more lax environmental regulations than we have. Every drop of oil that we produce in California, then, is a drop that we don’t import and a drop that reduces global carbon emissions.

Fringe environmentalists, the kind that think Californians will simply stop driving cars in the near future, don’t account for the fact that we are the third largest consumer of gasoline and diesel in the world, behind only China and the U.S. as a whole. The Energy Information Administration says that by 2040 80 percent of U.S. energy will still be supplied by fossil fuels. The oil has to come from somewhere. Why not here, where it is produced in a highly regulated environment and gas provide more jobs in our most economically troubled region, more state revenues, and more economic activity for us all? California’s oil and gas industry is already responsible for hundreds of thousands of jobs, billions of dollars in state revenues and economic activity. This success story should continue, and, while it does, environmental impacts will decrease. What’s not to love?

3) We are paying less for gasoline than we’ve paid in a long, long time. All Americans have noticed the dramatic drop in the price of gas lately thanks to the increased production that techniques like hydraulic fracturing allow. In California, we pay incredibly high taxes compared to most Americans, and gasoline taxes are no exception. This is particularly onerous on those with lower incomes who rely on transportation fuel to get to work. Unfortunately, this scenario is likely to change after January 1, when the state’s cap-and-trade program will extend to gasoline, a first-in-the-nation experiment many experts say will send the price at the pump soaring. But this holiday season, we can save a little extra and hope that the experts are wrong about the impact of next year’s regulations.

4) Greenhouse gas emissions are dramatically lower than at any time in recent years thanks to the shale revolution. California has led the way on regulating carbon emissions, but the shale revolution has made the dreams of even the most ambitious top-down regulator a reality by following market forces.

Anyone concerned with global carbon emissions should celebrate the fact that the U.S. leads the world in carbon emission reductions, thanks to cleaner-burning natural gas becoming a more dominant as a source of electricity in the nation’s power plants. Most of California’s electricity comes from natural gas that is produced – using fracking – outside of our state. Coupled with the environmental benefits of in-state oil production, this is a dramatic step in the direction of a lower-carbon future.

Methane, an even more potent greenhouse gas than carbon, is the primary constituent of natural gas and something that can escape, in small amounts, during the oil and gas production process. The good news is that methane emissions, too, have seen a steep decline since the shale revolution began several years ago. The industry does its best to keep emissions of methane as close to “zero” as possible because it has every environmental and economic incentive to do so. Methane emissions, then, have nowhere to go but down.

5) Oil production in drought-plagued California is not water-intensive. Many people don’t realizer that oil production is in reality mostly water production. A lot of water (“produced water” not previously in the water cycle) comes out of a rock formation and a small amount of oil is skimmed from it – as much as a 15:1 ratio. So, far from “using” a lot of water, oil production, well, produces it. The water, which is not potable, is treated and then used in closed-loop systems to enhance oil recovery, it is reinjected – cleaner than when it came out – back into the formation to stabilize pressure, or it is disposed of in Class II injection wells. None of this, by the way, has anything to do with fracking, nor is the process unique to the oil and gas industry. However, one advantage of actually producing water is that sometimes the water is clean enough that, when treated, it can be sold to the water-intensive agriculture industry to use for irrigation. This is a huge benefit for that industry with water being as scare as it is.

The news is also good with regard to fracking. “Ban fracking” activists try to paint the process as water intensive, but the fact is that hydraulic fracturing uses a negligible amount of water compared to almost any other use in California. How little? California used 64 million acre-feet of water in 2012. The agriculture industry used about 34 million of those acre-feet. Water our lawns used another 8.7 million acre-feet (something people should certainly work to reduce). Golf courses? 126,000 acre-feet. Even swimming pools in Los Angeles used 2,365 acre-feet of water.

Hydraulic fracturing in the whole state during the whole year? About 300 acre- feet. Not three million. Not 300,000. 300. A small fraction of a percent.

As Jay Lund, director of the Center for Watershed Services at the University of California, Davis, said:

You want to spend your effort on the places where you’re going to save the most water at the least cost. You should go after problems that really matter and not go after the de minimis things where it’s rhetorically convenient.

Conclusion

So, there you have it. We are blessed to live in California, but our energy success story is being duplicated in many ways in many parts of the country, from North Dakota to Texas to Pennsylvania.

Whether you are in California or elsewhere in the country (and if you are, bundle up!), we wish you and yours a wonderful Thanksgiving!

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