Well, hot diggety damn, folks. It looks like the Democrats finally convinced that coal-lovin’ West Virginian Sen. Joe Manchin to get on board with a climate bill. Heck, even Sen. Kyrsten Sinema, the once-progressive Arizona Democrat who has cozied up with corporations in recent years, is now saying she supports it.
As you probably already have heard, it did require some serious compromising on the Democrats’ part. This ain’t no Green New Deal. It isn’t even Build Back Better. It’s, well, the Inflation Reduction Act of 2022, which includes $369 billion to fight climate change. It also includes a provision that basically forces the feds to auction off oodles of acres for oil and gas development, which some folks understandably are upset about. I did a write-up on the bill, and the oil- and gas-related plusses and minuses, for High Country News.
There’s a lot of good in this bill (higher royalties for oil and gas, including on methane that’s extracted but not marketed; a methane fee; billions of dollars for environmental justice; and lots and lots of $$ for renewable energy). And some bad: The oil and gas leasing thing, for one. And I’m especially irked that it gives incentives for purchasing electric cars, but not electric (or non-electric) bikes. (Why not pay people to not buy a car? Now that would be revolutionary.)
And then there’s 45Q. While everyone was fretting over oil and gas leasing, they missed what could amount to a much bigger giveaway to the fossil fuel industry: Changes to the section of the tax code (45Q) that subsidizes companies to capture carbon from industrial facilities like cement factories and power plants. Scintillating stuff, no?
Well, it could be. The carbon capture tax credit is similar to solar or wind production tax credits, in which a company receives credit for each unit of power a facility produces. Only with 45Q its a credit for each ton of carbon captured: a $35-per-ton credit for carbon used for enhanced oil recovery and $50 per ton for geologically sequestering it without using it for oil production. The idea is to incentivize firms to install very expensive carbon capture equipment on, say, cement factories, which are tough to decarbonize. Companies also can sell their prospective credits on the tax equity market to finance a future project—if they can find willing buyers.
That’s what Enchant Energy wants to do to pay for its plan to retrofit the San Juan Generating Station in northwestern New Mexico with carbon capture equipment. (For more background, check out the stories I wrote about the plan for the Energy News Network and for the Land Desk.) The plant’s last operating unit is slated to shut down at the end of September. Enchant, in cooperation with Farmington’s municipal utility, want to keep the plant running—without carbon capture—until it can raise enough money to begin construction on the carbon capture equipment. But with the deadline quickly approaching, Enchant has not been able to secure financing and has missed multiple benchmarks.
They might get some help from the new climate/inflation bill. The section on 45Q looks like it came right out of the playbook of the Carbon Capture Coalition—which counts Shell, Valero, Peabody Energy, and Arch Resources as members. If the bill passes, the subsidy (yes, a tax credit is a subsidy) would be upped to $85 per ton for geologically sequestered carbon and $60 per ton if it’s pumped into an oilfield. And, equally significant, companies can opt to receive the credits as direct payments. Both provisions would be a huge boon to Enchant and its plan to keep a dirty old coal plant running, polluting and using billions of gallons of water each year.
Enchant Energy claims it will be able to capture 95% of the carbon from the plant or nearly 6 million tons per year. If that were to happen—and it’s extremely unlikely if not impossible—the feds would hand Enchant about a half-billion dollars per year. Taxpayer dollars, mind you. And that’s on top of the millions of dollars the Department of Energy has already given Enchant to produce a front-end engineering study and to look into the feasibility of geological sequestration in the San Juan Basin, where the geology has been perforated by 40,000 oil wells. There may be more: Since Enchant hasn’t been able to raise enough cash on its own to pay for the venture, it has turned to the federal government for up to $1 billion more in funding.
All of this to keep a coal plant running and polluting for years, a coal plant that otherwise would be closing down altogether in a couple months from now. Sure, it’ll keep the coal miners and power plant operators on the job, and that’s great. It’ll keep the property taxes coming to the local schools. That, too, is great.
But I’ve got a better idea: Shut down the power plant so that it stops sucking water out of the drought-starved San Juan River and stops polluting the area’s air and harming people’s health. Take the millions or even billions of dollars that would have gone to Enchant Energy, and spend the money directly on the communities that have been harmed by the San Juan Generating Station and the Four Corners Power Plant for more than 50 years. Those people deserve it. An obscure, New York City equity firm does not.
Speaking of climate … The monsoon arrived with a vengeance, offering both relief from drought and wreaking serious havoc. Massive debris flows from Arizona and New Mexico fire scars have left another round of destruction in their wake, and the Navajo Nation has declared a state of emergency due to flash flooding and mucked up roads.
River flows are getting a boost, too, which should be good for fish. Problem is, the amount of water in a river isn’t the only thing affecting the critters swimming around in it. Water temperature is also a big factor: When it gets above 70 F degrees, dissolved oxygen levels drop and fish can’t breathe. It used to be that wasn’t much of an issue in Colorado, where snowmelt-fed rivers tend to be pretty darned chilly. But now, it’s a common problem by mid-summer, when lower water levels combined with higher ambient temperatures result in warmer, less-oxygenated rivers.
Take the Yampa up in the northwest corner of Colorado. Its flows have been just below average this summer.
But the water temperature? Holy hot trout!
The high temperatures have prompted wildlife officials to implement voluntary fishing closures on that popular river for anglers (the closure has since been lifted as rains bolstered flows and cooled down nighttime temps). So in many cases, the warm temperatures are offsetting the benefits of the monsoon, which, so far, hasn’t done a whole heck of a lot to ease the drought.
As you can see from the Drought Monitor maps below, drought conditions from the Northwest and Northern Plains have been squeezed down into Texas and Oklahoma. Meanwhile the Southwest looks pretty much the same, despite the monsoon. The high temps in the Northwest as of late surely will dry things out some more and lead to more wildfires.
The Utah Rivers Council, Glen Canyon Institute, and Great Basin Water Network just released a study finding that the loss of hydropower at Glen Canyon Dam isn’t the biggest peril facing the 700-foot-tall concrete plug. Even more threatening: bad plumbing.
The dam wasn’t designed to run at low levels. As a result, as Lake Powell shrinks and water can no longer be released via the penstocks and hydroelectric turbines, water managers must send water downstream through the “river outlets.” Those weren’t designed for long-term use, however. At some point in the not-too-distant future those outlets may not be adequate for conveying the 7.5 million acre feet of water per year guaranteed to the Lower Basin States in the Colorado River Compact.
The study concludes by calling on the Bureau of Reclamation to launch a study to assess and address the problems either by modifying the river outlets or constructing a bypass next to the base of the dam. You can read more about what declining water levels mean for the dam here:
Archaeology Southwest and the Coalition to Protect America’s National Parks just released a report on how oil and gas development threatens Indigenous homelands and sacred sites in and adjacent to national parks and monuments. Regular Land Desk readers will be familiar with the threats around Chaco Culture National Historical Park and Hovenweep National Monument.
This report talks about that, but also looks at other parks and monuments around the West. Here’s a sampling of what they found:
The Bureau of Land Management’s (BLM) Farmington Field Office has leased nearly 92 percent of the public land surrounding Chaco Culture National Historical Park to the oil and gas industry, and oil and gas companies have drilled over 37,000 wells in the area.
Tens of thousands of oil and gas wells have been sunk in the area surrounding Dinosaur National Monument over the last century.
There are over 140 orphaned wells within 30 miles of Hovenweep National Monument.
Within the past ten years, BLM announced plans to put more than 10,000 acres of public land near Mesa Verde National Park on the table for oil and gas leasing. A 2015 BLM management plan for the area envisioned 1,000 new oil and gas wells to be drilled in the broader planning area surrounding the park.
Oil and gas development now surrounds Theodore Roosevelt National Park, as nearly 75% of the Little Missouri National Grassland, which borders the park on all sides, has already been leased for oil and gas development.
I'm still clutching my mid seventies copy of NEWSWEEK with a cover story on the impending ice age. Plenty of scientists backed up this pronounced that was further reinforced by a TIME cover story.
I've come to the conclusion that there needs to be a Manhattan style project that creates a sensible transition from fossil fuels to renewables without damaging the economy. Biden, Polis, Kerry, Newsom and the rest of the progressive governing class lack the knowledge and patience to accomplish this task. The "green movement" would do well to lobby for an independent task force to make the transition without political favors.
Thanks Jonathan; On your list of topics to write about someday, maybe add a good explanation of why public land leasing has actually no effect on the price of gasoline in the West. On the other hand, since dirt cheap leasing allows companies to expand company reserve estimates, and CEO salaries and stock prices are tied to reserve numbers, leasing does play a big role in increasing executive compensation and raising stock prices. So when our western Congressmen promote more leasing, the takeaway is that they are doing their best to increase the compensation to the executives who support their campaigns.