March 1 News: Keystone XL May Raise Gas Prices, Bloomberg Reports

Other stories below: Court Likely to Uphold EPA CO2 Rules; GE solar investments top $1.4bn in the last year

Bloomberg News: Keystone Oil Pipeline May Raise U.S. Gas Prices

TransCanada Corp. (TRP)’s Keystone XL oil pipeline, a project backers including Republican Presidential candidate Rick Santorum say will create cheaper U.S. gasoline, instead risks raising prices as much as 20 cents a gallon in the Midwest, Great Plains and Rocky Mountains. Photo: Bloomberg

The line would create a new way to carry Canadian imports outside the Midwest and reduce an oil surplus that’s depressing prices in the central U.S. Spot gasoline was 55 cents cheaper in Chicago than in New York on June 1, the second-highest ever. Nationwide, retail gasoline set its highest February average at $3.55 a gallon, data compiled by Bloomberg show.

Philip Verleger, principal of PK Verleger LLC. said “the Canadian plan was to use their market power to raise prices in the United States and get more money from consumers.”

The purpose of the $7.6 billion Keystone is to move 830,000 barrels of oil a day from landlocked Alberta to the Texas Gulf Coast, obtaining new customers and a higher price for heavy Canadian crude, Canadian regulators said in a 2010 report. The oil sold for $23.38 less per barrel in 2011 compared with heavy grades of Mexican crude, according to data compiled by Bloomberg.

“The Canadian plan was to use their market power to raise prices in the United States (UNG) and get more money from consumers,” Philip Verleger, founder of Colorado-based energy consulting firm PK Verleger LLC, said in an interview. Prices may gain 10 to 20 cents in central states, he said.

Keystone pipeline claims just don’t add up

Proponents of the Keystone oil pipeline argue the $7 billion project will create hundreds of thousands of jobs, give the economy a shot in the arm, lower gasoline prices and wean the U.S. from foreign imports.

Too bad the claims don’t hold up.

House Speaker John Boehner renewed his attack on the White House this week for postponing approval of the project pending a State Department review of the environmental impact of the proposed 1,661-mile pipeline, which would cross six Midwest states to deliver Canadian crude to the Gulf Coast. Republicans have intensified their attacks on Democratic President Barack Obama’s energy policies in recent days, blaming them for higher pump prices that could hurt his re-election prospects in the Nov. 6 face-off against the eventual GOP  nominee.

Why the Environmental Movement Is Not Winning

A searing new report says the environmental movement is not winning and lays the blame squarely on the failed policies of environmental funders. The movement hasn’t won any “significant policy changes at the federal level in the United States since the 1980s” because funders have favored top-down elite strategies and have neglected to support a robust grassroots infrastructure. Environmental funders spent a whopping $10 billion between 2000 and 2009 but achieved relatively little because they failed to underwrite grassroots groups that are essential for any large-scale change, the report says.

Released in late February by the National Committee for Responsive Philanthropy, Cultivating the Grassroots was written by Sarah Hansen, who served as executive director of the Environmental Grantmakers Association from 1998 to 2005.

Tensions Raise Specter of Gas at $5 a Gallon

Gasoline for $5 a gallon? The possibility is hardly far-fetched.

With no clear end to tensions with Iran and Syria and rising demand from countries like China, gas prices are already at record highs for the winter months — averaging $4.32 in California and $3.73 a gallon nationally on Wednesday, according to AAA’s Daily Fuel Gauge Report. As summer approaches, demand for gasoline rises, typically pushing prices up around 20 cents a gallon.

And gas prices could rise another 50 cents a gallon or more, analysts say, if the diplomatic and economic standoff over Iran’s nuclear ambitions escalates into military conflict or there is some other major supply disruption.

Court Likely to Uphold EPA CO2 Rules

After a two-day hearing, a federal appeals court appeared inclined to uphold key parts of the Obama administration’s first-ever rules for reducing greenhouse gases, but it wasn’t clear whether the court would endorse the government’s entire approach.

During three hours of oral arguments Tuesday, a three-judge panel for the Washington, D.C., appeals court made clear that industry challengers faced a uphill climb in attacking the Environmental Protection Agency’s 2009 finding that greenhouse gases endanger public health and welfare.

That determination set the stage for EPA rules regulating carbon-dioxide emissions on cars, beginning with the 2012 model year, and new rules on permits for power plants and factories.

Counting the Family Carbon

Which has the lower carbon footprint — our life in the New Jersey suburbs or our life in a cabin in the woods of Maine? We recently hit the halfway mark for our year in the woods, so I now have enough data to answer the question.

As a social scientist at the Nature Conservancy, I collect data compulsively. It’s not my only compulsion, but it’s on par with drinking fine beers. (Sadly, the two do not mix well — unless I’m counting beers.)

Since we moved from Australia to New Jersey nearly six years ago, I’ve carefully collected data on how many miles we drive each year, how much household electricity and natural gas we use each month and how far we travel by air. In Maine, I collect data on miles driven, firewood consumption, diesel fuel used for our backup generator, propane for the stove, water heater and back-up heaters, and the air miles flown when one of us travels for work or pleasure.

Santorum claims support of Sen. Inhofe, who hasn’t endorsed him

Rick Santorum is touting the support of Sen. James Inhofe (R) even though the Oklahoma senator has not endorsed him.

Speaking Wednesday to an Oklahoma radio station, Santorum said Inhofe has praised him as having the best record on issues important to him.

“Jim’s the real deal, too, and it’s an honor to have his support,” Santorum said.

But Inhofe, previously a Rick Perry backer, hasn’t endorsed Santorum, and the senator’s communications director disputed Santorum’s assertion that Inhofe had previously said he’d vote for him.

Obama Campaign, Billionaire Koch Brothers Spar Publicly

President Obama’s re-election team is engaging conservative oil magnates Charles and David Koch in a public spat they hope will rouse the Democratic base and draw donations to their campaign.

The back-and-forth began Friday when, in a fund-raising email to supporters, Obama campaign manager Jim Messina accused the billionaire brothers of “jacking up prices at the pump” and bankrolling “Tea Party extremism.”

Messina also said the Kochs have reportedly pledged $200 million, through the outside nonprofit group Americans for Prosperity, to help defeat Obama in November.

“Let’s see how many of us can chip in $2 or more to the Two-Term Fund,” he wrote.

The message drew a sharp response from Koch Companies spokesman Philip Ellender. In a public letter to Messina he denied the Kochs were trying to manipulate gas prices, and he said there was no hundred-million dollar pledge from them to target Obama.

GE solar investments top $1.4bn in the last year

A GE subsidiary has bought a $100m stake in a 127MW US solar project, taking the company’s investment in the sector to $1.4bn in the past year.

GE Energy Financial Services’ latest investment is in LS Power’s $550m Arlington Valley Solar Energy II project in Arizona. Construction on the plant is now expected to start next month with a view to producing enough electricity to power 53,000 homes from 2013.

Overall, GE now boasts investments in solar projects worth $5bn across Australia, Canada, Italy, Portugal, Spain and the United States and is also building what will be the largest US solar panel factory, a 400-MW solar plant in Aurora, Colorado.

23 Responses to March 1 News: Keystone XL May Raise Gas Prices, Bloomberg Reports

  1. fj says:

    There’s a pattern here. Bloomberg banned cigarette smoking from NYC bars and restaurants and as he’s mentioned a number of times smoking is projected to kill a billion people worldwide by 2050; they’re essentially coffin nails as some describe them.

    And the Keystone XL will just be another coffin nail for world civilization.

  2. Sasparilla says:

    The truth about the XL extension, as I mentioned months ago, is finally coming out (it was actually all about TransCanada getting closer to Brent Crude prices for its tar oil – 10% to 20% higher – and raising prices in the midwest to do so – why our government would want that – GOP and Dems – would appear only because TransCanada has bought off our politicians so they can raise oil prices for the US consumer).

  3. clays says:

    From the 1st Bloomberg story:

    Oil flowing through the Oklahoma-to-Texas segment of the Keystone pipeline would help remove excess supply in the Midwest and bring cheaper crude to refiners on the Gulf Coast, TransCanada Chief Executive Officer Russ Girling said in a telephone interview after the announcement.

    “It will help to reduce pressure on gasoline prices,” he said.

    Declines Offset Increases

    As more crude flows to markets such as the Gulf Coast, prices should decline there and balance out increases seen in other places, Stephen Schork, president of the Schork Group industry consultants in Villanova, Pennsylvania, said in a telephone interview.

    “Bringing these barrels to the Gulf would certainly have a dampening impact,” Schork said. “Getting more high quality, cheap oil to the market is the direction we need to go to see lower gasoline prices.”

    Keystone XL might lower the average cost of gasoline across the U.S. by up to 4 cents a gallon, Ray Perryman, a consultant hired by TransCanada to assess the economic impact of the project, said in an e-mail.

  4. clays says:

    Prices might go up in the Midwest (that currently has the cheapest gas in the nation), where there is a bottleneck, but go down in other locations.

  5. squidboy6 says:

    Of course oil companies will use the pipeline to get more profits. Why would they be so sanguine to have it built? Why would Republicans support it if it didn’t mean more money for them?

    We have to change the Supreme Court to get money out of elections. I was in Alabama a couple of weeks ago and the average worker there believes the most outlandish things, has standard code to speak racially charged language, and
    actually believes that Republican Party represents them and their desires, instead of manipulating and robbing them.

    The main problem with these dupes is they are willfully going along with a scheme to rob them because it uses racist stereotypes and language to blind them of the fact that blacks and poor whites, or even middle-class whites, in Alabama have more in common than they do with the rich who control the money in the South.

    Fortunately, they are a minority in the US.

  6. fj says:

    Of course, not a care in the world about the environment; and great fossil fuel expense to world populations: one-half $trillion subsidies worldwide, $1.5 trillion annual infrastructure maintenance, many $trillions more infrastructure investments; and, it gets worse.

  7. Lou Grinzo says:

    The Republicans have raised the practice of getting people to vote against their own interests to a high art:

  8. clays says:

    Of course not a care in the world for low income average Americans getting screwed by high energy prices.

  9. clays says:

    Plato said a flaw of democracy was the many poor would simply vote to take the money from the few rich. He saw it no better than stealing and thought it would lead to authoritarian rule.

    Yeah, what stupid people not using their vote for selfish personal gain.

  10. Sasparilla says:

    Probably the same consultant TransCanada had write the environmental impact statement for the State Department regarding the XL – everybody remember that and how truthful that was?

    The takeaway is that the oil once it gets to the gulf it will get refined and once its gasoline it is sold at world prices (as gasoline can be freely exported – crude cannot). This is why US midwest gasoline prices haven’t been exceptionally low even though their crude prices were exceptionally low – world prices for gasoline determine what we end up paying.

    What will happen is that TransCanada oil prices will go up overall and the impact on the US is an increase as the midwest slightly deflated gasoline prices will ramp up to parity with the rest of the nation. JMHO…

  11. Sasparilla says:

    Putting it on my list to read Lou – looks very interesting (and probably sad).

  12. Sasparilla says:

    Here’s a little Gem that I didn’t know, but stumbled upon today:

    The Cato Institute was originally created in 1974 as….The Charles Koch Foundation.

    I knew they set it up and funded it but having their name on it means something more, for whatever reason.

    Here’s the article that mentions it (about the Koch’s fighting with the CEO of the Cato):

  13. clays says:

    Gasoline Prices
    Retail gasoline in Chicago today averaged $3.91 a gallon, 13 cents lower than the $4.04 New York price and more than double the 6-cent difference between the two cities a year ago, according to AAA. The average gasoline price of $2.99 a gallon in Cheyenne, Wyoming is the same as a year ago and the price in Minneapolis is $3.65, according to AAA data.

  14. Welll..Mr Romney and others have now stated openly, ‘that America “Deserves” Canadian oil’. Fairly obviously the annexation of Canada is a prelude to bombing the snot out of the Middle East oil production.
    Over the past couple of years certain interests have reaped a hundred billion dollars or more by keeping the Cushing OK oil hub blocked so that Canadian oil imports could be stolen cheaply.
    The fact is that Canadians pay nearly twice as much as Americans do for gasoline…
    Now that they want to increase the flow, they must have more pipelines like the XL, but that would ruin their nice scam…

  15. Salamano says:

    From the HuffPost story on from Peter Montague …

    [environmental] funders have favored top-down elite strategies and have neglected to support a robust grassroots infrastructure. Environmental funders spent a whopping $10 billion between 2000 and 2009 but achieved relatively little because they failed to “underwrite” grassroots groups that are essential for any large-scale change, the report says.

    Somebody who’s honest… tell me the difference between this sort of analysis, and the concept of “Astroturfing”?

  16. prokaryotes says:

    Climate Progress in a Nutshell

    Somewhere In New Mexico Before The End Of Time

  17. prokaryotes says:

    My personal believe is that we could have a clean industrial evolution, similar to what people like Armory Lovins, Ian Dunlop or Jeremy Rifkin teach.

  18. malcreado says:

    Like China…

  19. Paul Magnus says:

    You dont get it do you. You cant live with a dysfunctional environment. You can live with high gas prices.

  20. Paul Magnus says:

    Moreover the project, if built, would raise the price of every oil barrel by $2 to $3 dollars in Canada over the next 30 years, and thereby create an inflationary price shock that would have “a negative and prolonged impact… by reducing output, employment, labour income and government revenues.”

  21. Paul Magnus says:

    Ok time for a time out…..

    Oceans’ acidic shift may be fastest in 300 million years

    During the warming period 56 million years ago, known as the Paleocene-Eocene Thermal Maximum, or PETM, and occurring about 9 million years after the extinction of the dinosaurs, acidification for each century was about .008 unit on the pH scale, Hoenisch said.

    By contrast, in the 20th century, oceans acidified by .1 unit of pH, and are projected to get more acidic at the rate of .2 or .3 pH by the year 2100, according to the study.