American Oil and Gas Reporter - September 2021 - 81

highest gasoline price among the states
and the District of Columbia. California's
average June regular gasoline price was
$4.26. Therefore, it calculates, since the
pump price for all other U.S. states except
California averages at $3.00, Californians
pay an average of $1.26, or 41.9% more.
· California's average residential power
price for the 12 months that ended in
April was $0.21.03 a kilowatt hour, 65.2%
greater than the U.S. average of
$0.12.73/kwh for all states minus California,
the country's sixth-highest. During
that period, California's residential ratepayers
paid $8.0 billion more than the average
ratepayers elsewhere in the United States
who used the same amount of energy.
· California's average commercial
power price for the 12 months ending in
April was $0.18.36 cents/kwh, 79.6%
higher than the U.S. average of 10.22
cents/kwh for all states other than California.
California's commercial prices were the
third-highest in the nation and the most
expensive among the contiguous states.
· California's average industrial power
price for the 12 months ending in April
was $0.14.78/kwh, 128.4% greater than
the U.S. average of $0.6.47/kwh for all
other states. California's industrial prices
were the fourth-highest in the nation.
· For the 12 months ending in April,
California's higher electricity prices
forced commercial and industrial ratepayers
to pay $12.2 billion more than
ratepayers elsewhere in the United States
using the same amount of energy. Compared
with the lowest rate states, commercial
and industrial ratepayers paid
$15.6 billion more.
Ultimately, the report reflects, onerous
regulations and other approaches that
drive up energy costs counteract the Golden
State's quest to improve economic
equity. " Equity is not a new concern, " it
notes. " One of the underlying tenets of
the New Deal during the Great Depression
was to recover but also expand prosperity
to those parts of the nation that had been
left behind, and central to this effort was
rural electrification and other energybased
economic development efforts such
as the Tennessee Valley Authority. The
concept of affordable and reliable energy
was considered a predicate to economic
progress. California through state actions
now appears to be reversing course on
these goals, targeting energy policies to
the higher income coastal areas that can
afford these costs and putting many in
the lower income regions further inland
increasingly at risk to energy cost-driven
poverty.
❒
EID: Cancellation No Cause To Cheer
WASHINGTON-Although many oil
and gas opponents were celebrating after
TC Energy announced its decision to
cancel the Keystone XL pipeline in early
June, analysis from Energy in Depth notes
that the cheers appear to be for a victory
that is based more on illusion than reality.
A report from EID's Nicole Jacobs
notes that TC Energy announced its decision
to cancel the pipeline project months
after President Biden revoked the pipeline's
international border crossing permit only
hours after his inauguration in January.
However, she advises, since pipelines are
merely the best-but not the only-way to
transport crude from Canadian oil sands
into the United States, that oil still will be
produced, transported and marketed.
" We all know it, but it's worth stating
again: Pipelines are by far the safest,
most efficient means of transporting oil, "
Jacobs writes. " Yet, U.S.-Canadian
pipelines continue to face attacks from
activists that either don't fully comprehend
supply and demand or don't care that
this oil will now need to be delivered via
truck, rail or-even worse-tankers from
countries across the ocean.
" In fact, contrary to the 'Keep it in
the Ground' narrative, stopping Keystone
XL doesn't actually stop the flow of
Canadian oil into the United States, but
it does limit the means and efficiency of
getting the supply into the country. "
She goes on to observe that the United
States imports 49% more oil Canadian
oil than it did when TC Energy resubmitted
its Keystone XL application in 2012.
" While much of this supply does enter
the country via existing pipeline infrastructure,
Canadian imports by rail also
have increased over this period. Even
with the sharp drop-off in 2020 due to the
COVID-19 pandemic, crude by rail imports
over the past 10 years have skyrocketed. "
More fundamentally, pipeline prevention
does not nullify consumer demand,
Jacobs observes, going on to cite an
American Petroleum Institute observation
that many U.S. refineries are configured
especially for Canadian crude.
" As infrastructure projects like Keystone
XL, Line 3 and Line 5 continue to be
targets for activism, refineries are forced
to look outside North America to ensure
a reliable supply of crude to provide valuable
feedstock for U.S. manufacturers, "
Jacobs reports. " The result? For starters,
the United States recently accepted its
second tanker of oil from Iran in the past
six months. Oil imports from Russia are
also currently at a 10-year high. "
Economic Fallout
Moreover, the impact of Keystone's
cancellation extends well beyond sending
dollars to Russia and the Middle East,
Jacobs indicates. " When the permit for
Keystone XL was cancelled in January,
the job losses were immediate, " she points
out. " More than 10,000 people found themselves
without anticipated income, including
roughly 8,000 labor union members. "
Jacobs cites congressional testimony
from Neal Crabtree, a member of Pipeliners
Local Union 798, who told the House
Natural Resources Committee that more
than 88% of his local union members
were out of work.
" The administration seems to think
these were just 'temporary jobs' and the
effect is not that bad, " Crabtree testified.
" I am not sure if they understand that a lot
of careers in this country rely on temporary
projects. A carpenter doesn't spend his
whole career on the same house, a lawyer
doesn't spend his whole career with the
same client. The Keystone XL was our
house to build this year, it was our client.
The effects of cancelling this project will
be far reaching, not only for the workers
but I also believe it will have negative
effect on future projects that provide the
reliable energy this country needs. "
During the same hearing, Jacobs notes,
Berg Pipe President and Chief Executive
Officer Ingo Riemer testified that his
company's Mobile, Al., and Panama City,
Fl., pipe mills had shed 519 jobs since
Keystone's permit was pulled. " This 78%
decrease of Berg's skilled workforce is a
direct result of the current national energy
policy, " Riemer is quoted. " It is devastating
for a business to invest billions into
pipeline infrastructure only to have a permit
revoked after the cash has been spent
and countless hours of work performed. "
Also feeling the loss are communities
such as Fallon County, Mt., and Midland,
S.D., Jacobs notes, which are among the
areas seeing their local economies and
tax bases fall precipitously since Jan. 20.
" Yet despite these very real consequences,
the leaders of this movement
are celebrating by immediately calling
for stopping the next pipeline in their
crosshairs, " she observes. " We should
all keep this in mind the next time these
folks try and convince us they want a
'just transition.' "
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SEPTEMBER 2021 81
American Oil and Gas Reporter - September 2021

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