The founding statement and mission of the Larimer Alliance (see here) as an organization has been to protect our environment and its citizens from the impacts that the oil and gas industry. However, this does not provide us with specific goals or metrics; but that has always been our ongoing focus of activities, ever since we started as an organization in summer 2018.
But this is a question I’ve really thought about, both personally and as a volunteer, as to how can I be more effective personally, and how the Larimer Alliance can be most effective as a platform. Through our presence on social media, testimonies at public meetings, and lobbying of our elected representatives, we have been hard at work on this over the time since then.
And our work has paid off! We were well positioned to take advantage of the election of the two new county commissioners, Kristin Stephens and Jody Shadduck-McNally, and now the commissioners have extended the moratorium on any new drilling permits for oil and gas wells in our county.
However, there are still 41 pending wells waiting to be approved which could be drilled here; see this screenshot from the COGCC website taken today:
Even with all of our actions, and with the apparent support of our commissioners, who also do not seem in favor any further drilling here, these oil and gas operators — Magpie Operating, Kerr-McGee and Prospect Energy — are still willing to drill.
Not only are these 41 wells a threat, there is an active, on-going campaign by a Dallas-based investment fund, King Operating Company, which has been aggressively promoting this even during the months of the Covid pandemic:
King Operating openly declares they would like to drill some 200 wells in the Wellington area, which would change that part of northern Larimer County forever. The drop in the price of and demand for oil during the pandemic has not deterred King Operating from pushing forward, nor has the passage of SB-181 in Colorado, nor has the passage of new oil and gas regulations.
So, I ask you, what do you think would make me feel safe from the outside, and outsized, threat of large, even multi-national, oil and gas companies seeking to drill up Larimer County, like they have Weld County? What would make you feel safe?
The only thing that will make me feel safe is seeing that our fossil fuel based economy is moving towards alternative energy in a convincing way. When I see that most of our coal-based electric power plants have been removed, or slated for removal, because the majority of the grid is running on alternative energy. When I start seeing at least half of the vehicles on the streets are electric, and there are enough charging stations that no one has to worry about being unable to recharge their car on a trip. When I read in the news that the stock prices of companies like ExxonMobil, Chevron, BP and Texaco have plummeted to the level of junk stocks, because no one wants to invest in companies that have no future. And when companies that manufacture electric cars, wind turbines and solar panels are attracting the real investor dollars, because their markets are booming, and they have a solid business future.
That is when I will start to feel safe. But how is that going to happen? By changing the economics on which the oil and gas industry is based. And while that might sound like Mission Impossible to some:
I can assure it is not that difficult, because this plan has been researched, studied to death, and lobbied for in the US Congress for over a decade. The plan is called a carbon tax; and the best carbon tax proposal that I have seen is the one from the Citizens Climate Lobby (CCL; see their website at citizensclimatelobby.org).
I would remind the reader that I have taught environmental economics at Front Range Community College since 2009, and have had carefully reviewed the various proposals for how fossil fuels are regulated, and the various proposals for supporting the transition to alternative energy.
The first thing to understand about the CCL bill (whose full name is The Energy Innovation and Carbon Dividend Act, H.R. 2307; see full details here: energyinnovationact.org) is that it is not just a tax on carbon, and also a dividend program.
In other words, all the money collected by the tax will be refunded to the American people (less the cost of administering the program). It is designed to be revenue neutral, and not increase the size of any other government programs. So, although this is called a tax, it is more properly referred to as a fee, since this will not raise any additional revenue for the government, which is the purpose of a tax.
The fee is based on the carbon content of the fuel in question, and is charged at the point where it enters the economy. In practical terms, this means the first wholesaler that sells a fossil fuel, before it has been processed or consumed. (See full analysis here: energyinnovationact.org/section-by-section-analysis). The carbon content would be established by the fuel classification, based on the CO2-equivalent of the fuel when burned or processed (this would be established in government labs, and applied uniformly). The tentative fee has been proposed at $15 per metric ton (which is quite low), but would ratchet up every year until GHG reduction levels have been met.
The CCL has been lobbying Congress for over 14 years about this, and have constantly refined how the program would work, based on their own research by hiring firms like Regional Economic Models, Inc (REMI) to study the effect of a revenue-neutral carbon price on the American economy. (see that report here) How the impact of rising carbon prices combined with the dividend has also been closely studied by the CCL consultants (see their Carbon Pricing Studies).
I would not expect most of our blog’s readers to want to delve deep into the weeds about this plan. What I would expect our readers to like to know is when I would feel safe — because that might assure them when they could feel safe — which is the primary reason for my writing this post.
And, last but not least, I strongly suspect that a carbon tax would spell the death knell for any more outside oil and gas companies wanting to drill in Larimer County — something that no amount of local regulation could ever do.
So please let me assure you: if the US Congress can pass the CCL version of a carbon tax/consumer dividend plan, that I would start to feel safe. And when the full impacts of a carbon tax start to work themselves out in the American economy, by hastening the disinvestment in fossil fuels, and hastening the investment in alternative energy and all its associated infrastructure — that’s when I will start to actually feel safe. Of course, that will take a few years…so, with that realization, you might appreciate what a long haul we are all in for in this transition from a fossil fuel based economy, to one that is based on energy — primarily electric — from alternative energy.
Finally, I would add that these are my personal opinions, and not those to the Larimer Alliance itself (though I would encourage their adoption of this position that I advocate).