[Author’s Note: I submitted the following comments to the Board of County Commissioners on July 28, 2021 because I did not get the opportunity to speak in the Zoom meeting on Monday night, July 26, 2021. Since the topic of this final meeting was about the financial ability of operators to conduct their business, that was my focus.]
Good evening commissioners, county staff, and the public in attendance:
Thank you for allowing public testimony at tonight’s historic meeting. I and my colleagues in the Larimer Alliance deeply appreciate this opportunity to make our voices heard.
Climate change is barreling down on us, and anybody who is in denial of this reality is either in denial of global scientific evidence or is seriously in need of a mental health checkup. I am sure the county government is on the side of science, factual evidence and the law.
Since this evening’s meeting is primarily about fiscal responsibility of how oil and gas operators conduct their business, I will frame my comments around the long term outlook for how well local operators will be able to continue to operate. I am only a common layperson who reads the news, but having been an economics instructor at Front Range Community College since 2009, I have read deeply into these economic issues.
I would ask the commissioners to be especially wary any operators seeking to drill new wells in the county. The primary economic indicator to which these operators will frantically point is the international price of oil; typically the NY Mercantile Exchange price, which today was $72/bbl. But that price is as unstable as a wind vane: it will change with the winds of change in international economics. Last September, that price was at $36/bbl. The current price is based on recent announcements by OPEC+, which could change tomorrow.
Fundamentally, the long term price of oil is stacked against drilling of any new wells because the forecast for the long term need of oil and gas is, shall we say….unfavorable.
The evidence for this is that the GHG from cars and trucks surpassed the GHG from coal-fired power plants back in 2016 — and has been rising ever since. Coal is at an industrial dead end of life. Though unthinkable a mere decade ago, that industrial dead end is now a reality. The other looming industrial dead end is the drop in future demand of fossil fuels for transportation. The future for this demand is in turmoil.
The use of EV’s, or electric vehicles, is ramping up, and every major car manufacturer in the world, including GM, has announced a target date by when they will cease production of fossil fuel powered vehicles, with dates varying from 2030 to 2050, most by 2035. The state of Colorado is already investing significant state resources in the encouragement of EV’s. We can certainly expect the adoption of EVs to grow dramatically in the next decade.
The date for the end of fossil fuel powered vehicles is just a mere decade and a half away. Although this is a high level macroeconomic projection, it is an undeniable global economic force that the commissioners should consider, for it will undoubtedly have dramatic implications for current investment decisions in the county.
Other macroeconomic factors that could affect investment decisions are national energy policy, such as a possible future carbon tax, which would dramatically impact any local operators’s financial projections.
I have not even begun to address the long term health impacts, which is a whole other argument against allowing any further investment in oil and gas drilling in the county.
Also, all the arguments by private property owners about “takings” are invalid, which SB-181 specifically addressed. These people need to read the law, which was arrived at after years of strenuous democratic activity — and also realize that the national and global imperatives about global climate change far outweighs any of their claims about damage to their private property and income.
Based on this evidence, I think the county should be steering its investments away from fossil fuels and towards renewable energy-based industries.