According to many barometers, the California economy is recovering. Our challenge now is to ensure that we address our challenges logically, to keep the economy robust.
One of those challenges comes in the form of climate change policies currently being considered by the California Legislature. The “emissions crusade” that started in 2006 when AB32, the Global Warming Solutions Act, was signed into law, was at a time that California was contributing a miniscule 1 percent to the world’s greenhouse gasses. Over the last decade, the state government has collected billions of dollars as a result of over-regulation, cap and trade fees, and other AB32-related programs – and that has dramatically increased the costs for energy and products to all 38 million who live in California.
It’s not the oil industry against the activists: It’s the emission crusaders against the economy!
Now, SB350, the Clean Energy and Pollution Reduction Act of 2015, would mandate additional emission reductions to further cut that 1 percent by 80 percent, down to 0.2 percent, which would further increase the costs for energy and products for Californians.
Unfortunately, these mandates that essentially do away with petroleum are illogical. The California population is projected to increase from 38 million to 50 million by 2050, along with an increase in registrations from 30 million vehicles to 44 million. At present, California is home to 100,000 electric vehicles, the most of any state. The other 97 percent of California’s 30 million vehicles that do not run on electricity or other alternative fuels rely on fossil fuels. And in the years to come, even with more registered vehicles and more mileage to be driven, fuel consumption is projected to remain about the same due to ever-increasing fuel efficiencies.
The numerous California industries and infrastructures that drive the economy and the lifestyle to which we have become accustomed are dependent on energy from the oil and gas industries for their existence as well as chemical byproducts from oil. Oil has industrialized the world and, most importantly, has powered the development of economies that drive the technological advancements that support the various infrastructures for transportation systems, sewage treatment, sanitation systems, water purification systems, irrigation, synthetic fertilizers and pesticides, genetically improved crops, agricultural productivity, dams, seawalls, heating, air conditioning, sturdy homes, drained swamps, central power stations, vaccinations, pharmaceuticals, medications, eradication of most diseases, improvements in manufacturing productivity, electronics, communication systems and so on. Fossil fuel energy’s benefits include contributing to a continuing reduction in infant mortality and the increased life expectancy, the longest in history, both factors which directly impact our quality of life.
The concern is further complicated by the fact that California is an energy island, with mountains on one side and an ocean on the other. California currently imports 48 percent of the crude oil needed by the in-state manufacturers of its transportation fuels via ships from foreign countries and Alaska. With crude oil shipments from Alaska on the decline, more crude oil will need to be delivered by foreign ships and by rail from the Midwest or Canada to meet the demands of the California energy island.
There are two reasons that it is illogical to simply “mandate away” fossil fuels.
First, the California “boutique” transportation fuels are manufactured in California, which minimizes greenhouse gases for the world as California has the strongest environmental controls in the world. If and when others states or countries opt to make the California boutique fuels, we would have an option to import our transportation fuels from other states or countries that have significantly less environmental controls, which would increase, not decrease, the world’s greenhouse gas emissions, and further raise the costs to deliver our transportation fuels from afar. Not to mention virtually no other state or country at present can provide California’s needs for transportation fuels in a timely manner.
Second, the huge California economy is very dependent on the continued mobility of its 30 million registered vehicles and the ability of maintaining a fuel supply to that growing fleet.
Rather than mandating narrow and costly reductions without any sense of impact on the economy, policymakers, regulators and community leaders should think broadly to find solutions across the entire energy system to meet California’s ambitious environmental goals. This means renewables, electricity – and the fossil fuels of crude oil, coal, gas as well as the products manufactured from crude oil.
Doesn’t this approach make more sense for California?
Ronald Stein is founder of PTS Staffing Solutions, a technical staffing agency headquartered in Irvine.