Stop Treating Oil Drilling as a Climate Policy Afterthought
California’s oil extraction industry once again emerged mostly unscathed by the state’s climate policy.
There’s no doubt about it: Governor Newsom’s climate policy executive order issued last week was groundbreaking in many respects. The requirement that new cars sold in California be zero-emission by 2035 is the first of its kind in the nation, positioning California as a clear leader in efforts to reduce oil demand.
However, despite the predictable pearl clutching by oil lobbyists, California’s oil extraction industry once again emerged mostly unscathed by the state’s climate policy. To the extent the Governor’s order touches on extractive industry, it feels like an afterthought. The order proposes very little new on the subject beyond the modest steps the administration already has in motion: publishing a health and safety rulemaking and enforcing oil well closure and remediation regulations. It calls for measures to address what happens after fossil fuel infrastructure sites close, including repurposing infrastructure, expediting remediation of former extraction sites, and ensuring a just transition for displaced workers. While these types of post-closure strategies are obviously important and need to be done right, the Governor’s order for the most part does nothing to actually push for the closures to happen, through active measures aimed at phasing out the oil industry.
The one notable exception is in a single “Whereas” clause stating, “to protect the health and safety of our communities and workers the State must focus on the impacts of oil extraction as it transitions away from fossil fuel, by working to end the issuance of new hydraulic fracturing permits by 2024.” The clause amounts to a call upon the California legislature to enact a fracking ban. Senator Scott Wiener and Assemblymembers Robert Rivas and Monique Limon promptly responded to that call, announcing plans to introduce such legislation in the coming year.
Those of us advocating for a transition away from fossil fuels are growing a little weary of saying, “It’s a good start but we need much more,” but that’s pretty much the situation here, again. A fracking ban in California would be significant. However, it remains to be seen whether the Governor will throw his full political support behind the legislative efforts, as his initial statements have underplayed the importance of a ban. The Governor stated that only two percent of California’s petroleum production comes from fracking, and described a ban as “symbolic.” However, the two percent figure appears to reflect only the first part of 2020, following the fracking moratorium put in place in November 2019. A comprehensive study performed in 2015 found that the number is closer to 20 percent.
So a ban on fracking would be well and good and …well, a good start. But the elephant in the room around which the Governor has carefully tiptoed is the highly polluting and vastly more prevalent method of extraction dominating California’s oil production: cyclic steaming. This practice, which some have begun referring to as “steam fracking,” essentially involves injecting steam underground to melt and force out the extremely heavy and viscous oil that is prevalent here. The process is an environmental catastrophe in multiple respects. From a climate perspective, cyclic steaming requires massive energy to heat up the stream, and produces heavy oil that takes more energy to refine, making the resulting crude some of the most carbon intense in the world, rivaling the Canadian tar sands. Additionally, it has blanketed Kern county for decades with simmering spills of superheated crude mixed with brine forced to the surface by streaming.
In justifying the limited scope of his actions with respect to fossil fuel production, the Governor pulled out a trope that has been an oil industry talking point for years: the “if we don’t drill for oil we’ll just have to import it to meet demand” line of reasoning.
There are a several holes in that logic. First, if the Governor is worried about imports, that horse is already out of the barn. California’s oil industry has been in decline for years, and the state now imports more than 50 percent of its oil from foreign sources as a result – a number that is steadily increasing. Treating a dirty and dying industry with kid gloves is not going to reverse that trend. Additionally, it bears note that while crude from foreign sources may be associated with problematic environmental practices, from a climate standpoint California’s crude is dirtier than the imports, due to the prevalence of cyclic steaming. But most significantly, the Governor’s logic fails to account for the fact that it is not just in-state consumer demand that is fueling the increase in California’s imports. As explained in a recent report by Communities for a Better Environment and consultant Greg Karras, West Coast demand has been declining, thanks in part to California’s efforts. The increased crude oil imports are not just fueling our cars, they are fueling production of refined products that are being exported from the state.
It’s time for the Governor to start thinking as big about California’s oil extraction as he is about reducing demand, so the state can start cutting carbon emissions with both sides of the scissors. Curbing California’s massively dirty oil extraction industry should not be a climate policy afterthought. And simply reiterating what you’re already doing, and planning for how to pick up the pieces after the industry goes away on its own, are not enough.
But here are some steps that would represent actual solid progress toward phasing out California’s oil production:
- Figure out how to limit permit issuance and then do it. California oil regulators have at times expressed the view that when permit applicants check all the required boxes, the regulators are required to issue them permits. That assumption is questionable, given the inherent discretion that the regulators have by statute to protect the environment and public health and address climate concerns. But one way or the other, the administration needs to definitively sort out what legal authority it has to deny permits for practices that are harmful to the environment, regardless of the checked boxes—and then either start using that authority, or ask the legislature to give it to them. The Governor’s call on the legislature for a fracking ban was a positive step in this direction, but regulators’ legal authority to say no should be established for all types of drilling.
- Start doing meaningful environmental reviews of oil drilling. Under the California Environmental Quality Act (CEQA), government regulators are required to carefully scrutinize the environmental impacts of any project approval decision, and require mitigation measures to address those impacts. Regulators at both the state and the county level have thus far managed to dodge that requirement when issuing oil drilling permits. Kern County, where roughly 80 percent of California’s production comes from, recently re-issued an ordinance that was struck down by a court the first time, which is based on the absurd premise of a one-time, one-size-fits-all CEQA review covering all future permits issued in the County. And the California Geologic Energy Management Division (CalGEM) not only lets the County get away with that, declining to recognize the invalidity of that process and take the CEQA reins back as it could, but uses its own tortured legal logic to exempt permitting processes from CEQA review altogether. That’s got to stop. Regulators need to start using CEQA as intended to give Californians a clear-eyed look at the environmental consequences of oil drilling projects, and mitigate their environmental impacts through all available means.
- Crack down for real on cyclic steaming. The Newsom administration has taken some modest steps toward addressing the environmental dumpster fire that is cyclic steaming, but much more is needed. CalGEM finally last year put in place a rule concerning the spills that are caused by cyclic steaming, and is studying the practice further while a partial moratorium on it remains in place. But the moratorium does not apply to all cyclic steaming across the board, and allows operations to continue under existing permits. The rule also does not prevent the outrageous practice of oil companies profiting from their spills by selling the oil they recover. The administration should immediately ban that practice. It should also use the authority it has, or can get from the legislature, to phase out cyclic steaming altogether.
- Establish a statewide 2,500 foot setback buffer. The advocacy community, including NRDC and countless others, has been calling loudly for CalGEM to establish a 2,500’ buffer from oil drilling operations as part of its ongoing public health rulemaking. CalGEM needs to listen. Extensive science supports a setback of this magnitude, which was recently put in place by Ventura County. Communities everywhere need and deserve that same protection. A robust statewide setback would help ensure that the production that harms communities most is phased out first in California’s transition away from oil production.
We understand that taking these steps would be hard. The oil industry would not take them in stride, and would unleash their tens of millions of dollars of campaign contributions and lobbying fury to prevent them from seeing the light of day. And it will be essential to consider the workers and communities currently reliant on California’s oil industry. But when it comes to measures to reduce oil demand, California has never shied away from a challenge. It’s time for our state’s leaders to start displaying that same “come at me bro” spirit toward the oil extraction interests who would keep our state mired in its dirty energy past; and collaborate with workers and communities to forge a path toward ending California’s participation in the dirty energy economy once and for all.