Mine environmental risk grows with bankruptcies in big coal - We the taxpayers are paying for irresponsible business strategies!

Another example of outdated, irrational and unfair laws and regulations that allow the energy industry to make profits without being responsible for their actions:

	May. 19, 2016 3:24 AM ET Mine environmental risk grows with bankruptcies in big coal By MEAD GRUVER, Associated Press  CHEYENNE, Wyo. (AP) — As more coal companies file for bankruptcy, it's increasingly likely that taxpayers will be stuck with the very high costs of preventing abandoned mines from becoming environmental disasters.  The question is not if, but when, where and how many more coal mines will close as the industry declines, analysts say. Many mines already operate at a loss, and there's not enough money in the fuel anymore to enable their owners to keep their promises to clean up the land. "It's sort of a situation where nobody, really, is going to end up looking good," said James Stevenson, director of North American coal for analyst firm IHS. "The states have I think a significant risk — the federal government does as well." This reclamation crisis looms because of a practice called self-bonding, which allows coal companies to promise to eventually cover the cost of cleaning up abandoned mines without first setting aside the necessary money. Because of self-bonding, billions of dollars in legally required reclamation funding exist only as IOUs, without dedicated assets or bonds backed by third-party investors. Nationwide, self-bonding in the coal-mining industry tops $3.3 billion. That includes $2.3 billion in IOUs that the three biggest bankrupt coal companies — Alpha Natural Resources, Arch Coal and Peabody — owe in five states, according to an Associated Press analysis of bonding obligations in the top 16 coal-mining states. Highlighting by me. Read the full story below:
	The dilemma for state and federal regulators got even bleaker when the nation’s largest coal producer, Peabody, filed for Chapter 11 protection from its creditors in April. Peabody alone holds more than $1.1 billion in self-bonding obligations for mines in Illinois, Indiana, New Mexico and Wyoming, where its North Antelope Rochelle mine produces almost 12 percent of the nation’s coal. With several major U.S. coal producers filing for Chapter 11 over the last two years, the issue will play an important part in shaping coal’s future. Mines in Appalachia are particularly likely to close as the industry consolidates around a smaller number of still-profitable mines out West, Stevenson said. In Richmond, Virginia, Judge Kevin R. Huennekens is considering Alpha’s proposal to transfer its “crown jewel” mines in Wyoming to creditors and close its unprofitable mines in West Virginia. Alpha’s self-bonding obligations total $410 million in Wyoming and $243 million in West Virginia. The company’s plan would leave a reorganized Alpha without a reliable profit stream to address reclamation in West Virginia, the state’s attorneys told the judge in April. An Alpha spokesman didn’t return a request for comment, while spokespeople for Arch and Peabody emphasized their companies’ commitment to reclamation that occurs as part of day-to-day coal mining operations. Peabody is in talks with states about freeing up as much as $200 million to cover the company’s self-bonding obligations during reorganization, spokeswoman Beth Sutton said. Many American utilities will need coal to generate power for decades to come, but low prices for natural gas and increasingly cheaper renewable energy have driven down coal’s share of the nation’s electricity portfolio from half to about a third in the past decade. Coal’s prospects are so grim that major lenders including JPMorgan Chase, Bank of America, Citigroup, Morgan Stanley and Wells Fargo no longer plan to finance new coal mines or coal-fired power plants. “Lender fatigue is probably at an all-time high,” said Monica Bonar, senior director at Fitch Ratings. The 1977 Surface Mining and Reclamation Act enabled companies to open strip mines on the condition that assets be set aside to contain any pollution and return the mines to something resembling the pre-existing landscape. But companies with debts no greater than 2.5 times their net worth were allowed to avoid tying up capital by “self-bonding” instead. Self-bonding has grown to represent more than a third of the industry’s cleanup costs. With several companies now in bankruptcy, states have reached agreements to secure pennies on the dollar for reclamation should Chapter 11 reorganization proceed to Chapter 7 liquidation. Meanwhile, Wyoming has agreed to keep in place permits for coal mines that otherwise would have insufficient bonding to operate. “One of the fundamental parts of our surface mining laws is a mine can’t get permitted without adequate bonding,” said Shannon Anderson, an attorney with the Powder River Basin Resource Council in Sheridan. “Wyoming agreed to basically not pay attention to that legal requirement.” The federal Office of Surface Mining Reclamation and Enforcement has asked states to explain their approval of self-bonding in several cases. “It’s a big issue,” Interior Secretary Sally Jewell told the House Natural Resources Committee late last year. “There is no question that with the increased financial fragility of many coal-mining companies, if they are self-bonded, that does potentially leave the states and the taxpayers at risk.” Wyoming, which produces almost 40 percent of the nation’s coal, has more than $2 billion in self-bonded coal mining, almost two-thirds of the nationwide total. Wyoming’s coal mines are all still operating and the state would like to keep it that way: Gov. Matt Mead has promised to “double down” on coal rather than refocus on renewables. “Wyoming is a coal state, but Wyoming will not accept sacrificing our reclamation efforts. One of the best ways to continue reclamation is to keep these companies in business,” Mead said. Environmentalists aren’t reassured. The Rocky Mountain region has a long history of derelict hard-rock mines polluting rivers and streams. “Is it going to turn into a big, toxic pit up there?” asked Jeremy Nichols with the group WildEarth Guardians. “If nobody’s paying attention to it, it’s going to be hard to say that it’s safe.”

Impacts of Genetically Engineered Crops

A blogpost by Marcia Ishii-Eiteman, senior scientist at the Pesticide Action Network:

New GE report misses its own point

Last week, the National Academies of Science (NAS) attracted much media attention with the release of its newreport, "Genetically Engineered Crops: Experiences and Prospects." The report assessed a range of health, environmental, social and economic impacts of GE crops.

According to report authors, genetically engineered (GE) crops have failed to live up to the hype advertised by corporate manufacturers. And more rigorous monitoring and oversight by regulatory agencies is needed, they say, to protect against unexpected adverse outcomes. I heartily agree. 

Unfortunately, these and other important findings are buried within the report’s 400+ pages — and then glossed over in the authors’ own recommendations, as well as in the NAS press release that paints a decidedly more upbeat picture of the impacts of GE crops.

Failure to deliver

A popular and oft-repeated claim by the biotech industry is that GE crops boost yields and are necessary to “feed the world.” The prestigious and most comprehensive assessment of agriculture ever to have taken place — the UN-led International Assessment of Agricultural Knowledge, Science and Technology for Development (IAASTD) — already shredded that thesis in its 2008 landmark study authored by over 400 scientists and development experts from more than 80 countries. GE crops, the IAASTD found, primarily serve to boost multinational corporations' profits rather than to benefit poor and small-scale farmers around the world.

The 20 authors of the far more limited NAS study agreed that GE crops have not contributed to measurable increases in crop yield or even “readily identifiable economic benefits” for many farmers. And the authors acknowledge that given the considerable uncertainty around emerging GE technologies’ potential future impact on yield, and the fact that feeding the world involves “much more than simply increasing crop production,” GE products themselves are unlikely to offer much in this regard. The NAS report even emphasized the importance ofagroecology in meeting global food demands, stating its awareness “of the central role that agroecology plays in fostering resilience in agriculture” — a high-level finding of the IAASTD as well.

Disconnecting the dots?

Yet, despite its findings on these issues of global concern, the NAS authors frequently backpedal when it comes to articulating salient recommendations. For example, on the one hand, the authors state that "given the uncertainty about how much emerging genetic-engineering technologies will increase crop production, viewing such technologies as major contributors to feeding the world must be accompanied by careful caveats."

But next, the authors recommend that “balanced public investment in emerging genetic-engineering technologies and in a variety of other approaches should be made because it will be critical for decreasing the risk of global and local food shortages.” This statement, like many others in the report, can easily be misconstrued as a call for continued or increased investment in GE technologies in order to “feed the world,” when such a recommendation does not follow logically from the report’s conclusions.

While I am pleased to see NAS tackle many of the controversies surrounding GE crops, it's disturbing to notice that all too often the committee’s recommendations are disconnected from the substance of its own findings. As ever, the devil is in the details of what is subtly rephrased — with the resulting take-away message no longer in line with the evidence supplied.

Digging deeper into the weeds

The NAS study concludes, not surprisingly, that widespread planting of GE crops in the U.S. has led to a significant increase in herbicide use (primarily glyphosate, now classifiedby the World Health Organization as a probable carcinogen). The report acknowledges that the emergence of glyphosate-resistant weeds — nowinfesting over 60 million acres of U.S. farmland — is a “major agricultural problem.” USDA’s controversial approval of a raft of new herbicide-resistant GE seeds, such as Dow’s 2,4-D resistant corn, cotton and soybean, is duly noted.

Yet the NAS authors inexplicably stop short of fully investigating and forming much-needed recommendations relating to the complex rippling effects of thepesticide-and-transgenic treadmill — or related impacts of seed and pesticide industry concentration — on farm size and viability, farmers’ livelihoods, and rural communities’ health and wellbeing.  

In terms of environmental impacts of GE crops, the NAS group states they found little evidence for concern. Here, again, the report's conclusions don't square with specific findings. How can there be little evidence for environmental concern when report authors recognize that herbicide-resistant crops have led to the expansion of acreage devoted topesticide-intensive industrial agriculture and a dramatic increase in herbicide use? Entire landscapes and regions of the world have been altered as a direct result.

Safe for whom?

The NAS study's most publicized conclusion is that authors found no evidence of adverse health effects from consumption of GE foods. Not surprisingly, several media outlets quickly latched onto the grossly simplified finding that “GMOs are safe.”

But as Maywa Montenegro, a PhD candidate in the Department of Environmental Science, Policy and Management at UC Berkeley, points out,

“The NAS report’s approach to assessing risk has been circumscribed to a very narrow slice of 'safety': that is, risk to the person of ingesting GE food. Does this blinkered approach to safety warrant neglecting the safety of farmworkers and family farmers who produce the food? Has this study sufficiently queried the long-term human and environmental impacts of using glyphosate and 2,4-D? How safe is the spread of patented GE seed technologies for Indigenous knowledge, practices and culture? And how safe is it for a handful of corporations to control roughly 60% of commercial seeds globally?"

These are the types of questions that the NAS committee ought to have been investigating from the start.

From the earliest days of this exercise, many of us in the scientific community — including 67 scientists, researchers and professionals —  expressed concern and skepticism regarding the NAS’ selection of committee members. An investigation by Food and Water Watch revealed that, ultimately, over half of the NAS GE report committee has or had ties to the biotech industry — or to industry-sponsored or funded groups.

Clearly the NAS could and should have done better in its investigation. More fundamentally, it should not be “good enough” to find evidence of little or no harm (a conclusion we dispute, in any case). If GE technologies are not in fact improving sustainability, resilience or equitable relationships within our food system, we should not be wasting our time trying to legitimize our continued reliance on them.

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READ and SHARE ONLINE: http://www.panna.org/blog/new-ge-report-misses-its-own-point

Why the Environment Should Come First!

The protection of the environment is of superior importance over other problems of injustice and exploitation (race, wealth, gender,...) as a healthy environment is the basis of survival of all of humanity. Our current focus on fixing other issues first is causing us to steer more and more towards a global catastrophe from which humanity and many other species on this planet will not or will only slowly and barely recover. This is excellently visualized in the below analogy of humanity building a brick wall and taking out more and more bricks from the foundation with the obvious result unless we want to defy gravity...

Source: Dr. Michael T. Barbour, Center for Ecological Sciences, Tetra Tech, Inc.

More on Natural Gas Pipeline Overbuild - Here in Michigan/Ohio and in Appalachia and North Carolina

Shared by Frank Zaski

Articles by the INSTITUTE FOR ENERGY ECONOMICS AND FINANCIAL ANALYSIS

The article    http://ieefa.org/two-pipeline-expansion-projects-appalachia-indicate-rush-toward-overbuilding/

The study  http://ieefa.org/wp-content/uploads/2016/04/Risks-Associated-With-Natural-Gas-Pipeline-Expansion-in-Appalachia-_April-2016.pdf

• Pipelines out of the Marcellus and Utica region are being overbuilt.
• Overbuilding puts ratepayers at risk of paying for excess capacity, landowners at risk of sacrificing property to unnecessary projects, and investors at risk of loss if shipping contracts are not renewed and pipelines are underused.
• The Federal Energy Regulatory Commission facilitates overbuilding. The high rates of return on equity that FERC grants to pipeline companies (allowable rates of up to 14%), along with the lack of a comprehensive planning process for natural gas infrastructure, attracts more capital into pipeline development than is necessary.
• FERC’s approach to assessing the need for such projects is insufficient.
• Industry leaders recognize and acknowledge that current expansion plans will likely result in overbuilding.

 A webinar with the study's author:

More detail on the webinar available here: http://appvoices.org/webinars/pipelines/

World leaders sign Paris Agreement on climate change – video | Environment | The Guardian

Finally a good signal - but in itself it will not prevent massive displacement, uprising, war and chaos - not to speak loss of biodiversity and massive suffering of humans and fellow beasts that the world will face if we do not change fundamentally and do so even sooner than 2050.



World leaders sign Paris Agreement on climate change – video | Environment | The Guardian

The NEXUS and ROVER Pipelines are bad for the Environment and the Economy and Should not be Permitted

Frank Zaski posted this today to the Nexus comments. These arguments work against Rover as well. 

http://elibrary.ferc.gov/idmws/common/opennat.asp?fileID=14211961

FERC must consider SUPPLY AND DEMAND CONDITIONS HAVE CHANGED DRAMATICALLY FOR NEXUS AND ROVER. (Many of them are outlined below.) These major changes have to be considered in the application of FERC policies and in the Certificate decision.

Lower demand and lower prices have impacts on proposed and existing pipelines especially; lack of adequate subscription, increased chance of overbuild, lack of financial support, full costs of overbuild passed on to customers, subsidization, lack of public convenience and necessity, environmental degradation, etc. https://www.ferc.gov/legal/maj-ord-reg/PL99-3-001.pdf

 

THE PREMIUM DAWN HUB PRICE FOR NEXUS AND ROVER IS GONE

“The major markets when this pipe first was put in is gone,..” This is a DTE executive’s comment in reference to a question about NEXUS from an analyst.http://finance.yahoo.com/news/edited-transcript-dte-earnings-conference-200647250.html  

 

According to Maria Cortez of Wood Mackenzie, “ … the need for the Nexus Pipeline that would transport natural gas across northern Ohio appears to have declined. The market for that pipeline may not exist anymore.”  http://www.ohio.com/blogs/drilling/ohio-utica-shale-1.291290/shale-downturn-will-cost-ohio-landowners-in-lost-royalties-1.674247

 

 

Gas prices at DAWN are now similar to Henry Hub and are expected to be LOWER in 5 years

Today, the prices at Dawn and Henry Hub are virtually the same and the profit incentive to build more capacity to Dawn has disappeared. Note the price convergence in this table.

http://www.ferc.gov/market-oversight/mkt-gas/midwest/ngas-mw-yr-pr.pdf

 

According to a new Ontario Energy Board (OEB) reports:

Ample supplies of Marcellus/Utica gas are already flowing to Eastern Canada thru Niagara, Chippewa and (soon) Waddington, New York

 

Gas from these pipes is less expensive than gas from Vector, Dawn, Rover and especially Nexus. The landed cost of gas into the Enbridge EDA (Toronto) would be lower from Niagara ($4.90 $CAD/GJ) and Waddington ($5.30) than from Vector ($5.55), Rover ($5.73) or Nexus ($5.82).

 

Canadian business, utility and industrial users do not want unnecessary and costly OVERBUILD of the Dawn Parkway pipeline needed to transport additional Rover/Nexus gas from Dawn. Businesses realize they would have to PAY ALL COSTS OF PIPELINE OVERBUILD including legacy costs.

 

Gas turbines are a very small percentage of Eastern Canada’s electric generation portfolio.

 

Overall, Canadian demand for gas is forecasted to rise very slowly.

http://www.ontarioenergyboard.ca/oeb/Industry/Regulatory%20Proceedings/Policy%20Initiatives%20and%20Consultations/2015%20Natural%20Gas%20Market%20Review%20%28EB-2015-0237%29

 

 

In 2014 the price of gas at Dawn spiked to $16. (Page 6) (This probably encouraged Rover and Nexus to plan pipelines to this hub.)

 

Dawn and Henry Hub prices are forecasted to be virtually the same from 2015 -2021 with Dawn’s price dropping lower in 2021. (P15)  http://www.ontarioenergyboard.ca/oeb/_Documents/EB-2015-0237/Navigant_2015-NGMR_Presentation.pdf

 

Nexus will have a carrying capacity of 1.5 billion cubic feet of natural gas per day. Of note, DTE’s gas utility sends out about half that, 0.8 billion cubic feet, every day to customers. 

 

Rover will have a capacity of 3.25 billion cubic feet per day, more than twice that of Nexus. Analysts say Rover is the biggest proposed pipeline to emerge from the Appalachian gas boom. 

http://www.crainsdetroit.com/article/20160417/NEWS/160419827

 

 

Commitments and financials of Nexus and Rover shippers/producers/customers are questionable

Most are mired in debt and 60 gas and oil producers have already gone bankrupt.

In FERC documents, Nexus reports they have agreements for only 56% of their capacity. Some question the accuracy of this percent.

 

 

IT’S OK TO CANCEL (OR FERC TO NOT APPROVE) PIPELINES IF THEY ARE "NOT ECONOMIC"

 

Kinder Morgan cancelled the NED pipeline because of inadequate capacity commitments

 

"Unfortunately, despite working for more than two years and expending substantial shareholder resources, we did not receive the additional commitments expected," Wheatley said. "As a result, there are currently neither sufficient volumes, nor a reasonable expectation of securing them,"http://www.unionleader.com/Kinder_Morgan_pipeline_suspended

 

“ …. this project is not economic, so we're removing it from the backlog," President and CEO Steve Kean said during the company's April 20 earnings call.

 

"The return on the NED project at the level of commitment that we have would be less than 6% unlevered after-tax. That's clearly not viable and we are far better off having cash available for other uses,"

[Plus, from their press release, “this low-price environment” .. “has made it difficult for producers to make new long term commitments.”]

https://www.snl.com/InteractiveX/article.aspx?ID=36196929&KPLT=2

 

 

Approving the multi-billion dollar Rover and Nexus pipelines (which essentially parallel each other from Ohio to Dawn) is imprudent considering:

·         the Dawn premium price incentive is gone

·         long-range forecasts call for tepid gas demand growth in Ontario and Michigan

·         limited East Coast LNG export potential

·         cheaper/plentiful Marcellus and Utica gas already flowing to Canada through New York

·         and, questionable shipper/producer/customers’ ability to carry out commitments 

Stop corporate tax abuse | Oxfam America

The unimaginable wealth of a greedy minority of people in the world (less than 0.001% of the world's population) stands at the root of all social and environmental issues!!! They do not invest their fortune to better their fellow men and beasts but rather concentrate even more wealth.



Stop corporate tax abuse | Oxfam America