In a 235-186 vote this week, the House passed the Southeast Arizona Land Exchange and Conservation Act of 2011, which approves the trade of 2,400 acres of federal land for 5,000 acres controlled by the mining company. The Minnesota House delegation split its vote along party lines.

A Rio Tinto subsidiary, Resolution Copper Mining, is seeking the land swap in order to better access what it claims may be the largest copper ore body in the world near Superior, Ariz. Another subsidiary of Rio Tinto, Kennecott, is exploring a non-ferrous mining site in northeast Minnesota. Minnesota has no working non-ferrous mines, although some are nearing the end of their permitting process.

The land sought by the mining company in Arizona includes the Tonto National Forest’s Oak Flat Campground, which was recognized as an important natural resource and placed off limits to mining activity by President Dwight Eisenhower in 1955. The mining company claims that the project will create jobs.

In testimony to the U.S. Senate Senate Energy and Natural Resources Committee Subcommittee on Public Lands and Forests in June 2009, Sandy Bahr of the Sierra Club’s Grand Canyon (Arizona) Chapter argued that the land swap will diminish recreational opportunities and threaten rare and endangered plants and animals including the black-chinned sparrow, Costa’s hummingbird, Lewis’ woodpecker, and the endangered Arizona hedgehog cactus.

Bahr also warned that the mine will deplete the area’s already scarce water supply.

“According to Resolution Copper Company (RCC), this mine will need as much as 20,000 acre-feet of water per year. An acre-foot of water is roughly the amount of water a family of four uses in one year, so 20,000 acre-feet is enough water for 20,000 families or 80,000 people for one year,” she said. “Considering how important as water is in Arizona, the continued long-term droughts we experience, and the predictions of scientists that we are going to get hotter and drier due to the impacts of climate change, it would be irresponsible to move this bill without a thorough analysis and some strong assurances that the water will be there and will not risk riparian areas or drinking water supplies.”

In 2009 the National Congress of American Indians passed a resolution that asked the U.S. federal government to recognize and protect the area’s cultural and spiritual value and to protect it from mining.

The Congress said that mining this area will “break the relationships between tribes and all the elements of the natural world in this region,… result in the diminishment of the power and effectiveness of tribal ceremonies, songs, prayers, and traditional life … and add to physical and mental illnesses, and social problems.”

This is not the first time the company has run afoul of both Native Americans or environmentalists. Another Rio Tinto subsidiary, Kennecott Eagle, is developing a nickel and copper mine in Michigan’s Upper Peninsula on land that is considered sacred by local tribes. They are also facing a lawsuit in Wisconsin over the leaching of toxic chemicals from a mine there and another suit by citizens of Papua New Guinea accusing them of engaging in genocide and human rights violations for another mine in that country.

The land swap bill is supported by business groups including the American Supply Association, the Associated General Contractors of America, the National Association of Manufacturers, the National Mining Association, Rio Tinto, the U.S. Chamber of Commerce, the National Federation of Independent Business, and Americans for Prosperity, according to Maplight, a nonpartisan organization that researches money in politics.

Maplight found that supporters of the bill spent 14 times as much as those opposing it.

The group found that metal mining and processing groups gave on average 22 times as much to House Republicans that voted “yes” as they gave to House Republicans that voted “no”.

Amendments to exempt Native American heritage sites from the land transfer, charge royalties on the minerals extracted from the transfered land and require that the company hire local workers were all rejected in the House.

Supporters of the Keystone XL pipeline claim that the project will be a rich source of jobs, but critics say their numbers don’t add up and any boost in jobs will be temporary.

The controversial TransCanada project would move tar sands oil — diluted bitumen — from northern Alberta, Canada 1,700 miles across the U.S. to refineries along the Gulf of Mexico through a three foot wide pipe that would cross North Dakota, Montana, Nebraska, Oklahoma and Texas.

TransCanada and the American Petroleum Institute say that the project will generate at least 20,000 jobs, but the U.S. State Dept., which considered the project’s socioeconomic impact as part of the still ongoing permit process, puts the number far lower.

“During construction, there would be temporary, positive socioeconomic impacts as a result of local employment, taxes on worker income, spending by construction workers, and spending on construction goods and services,“ the agency said. “The construction work force would consist of approximately 5,000 to 6,000 workers, including Keystone employees, contractor employees, and construction and environmental inspection staff.”

Advocates for the pipeline say that building it will have a multiplier effect because many new jobs will be created to serve the construction work force.

An economic impact study by the Perryman Group, commissioned by TransCanada, found that the project would create 118,935 “person-years” of employment.

The Cornell Global Labor Institute recently published an analysis of the Keystone jobs claims that criticizes the methodology of the Perryman report.

“Person-years,” said Institute Director Sean Sweeney, is an inappropriate way to talk about the economic impact of the project because people will easily confuse that for the total number of jobs the project would create. And that is exactly what is happening.

On June 23, as he hailed the passage of a bill to expedite a decision on the Keystone pipeline, House Energy Committee Chair Rep. Fred Upton said that the pipeline would “create more than 100,000 jobs.”

In an editorial for the Tulsa World this week associate editor Mike Jones writes that the Keystone project “smells like jobs.”

… Once finished, the states along its path could receive an additional $5.2 billion in property taxes. That’s is a good deal of money for public schools in Oklahoma that are making drastic cutbacks. And there is this: The $7 billion project could create as many as 100,000 jobs, as many as 20,000 of which would be high-wage manufacturing jobs. Those jobs and the pipeline would create spin-off companies and more jobs. Some industry experts believe that the project could create as many as 250,000 new jobs, although that could be an inflated number.

Sweeney, at the labor institute, says people should be skeptical about claims like this.

The Perryman Group report that estimated 118,935 person years of employment for the project “does not allow for independent validation of the findings because details are not provided about the inputs or how the outputs are arrived at,” he said.

In an e-mail to Michigan Messenger Perryman Group president M. Ray Perryman acknowledged that his modeling system is “proprietary” but insisted that it is valid and widely respected.

“All construction jobs are temporary,” Sweeney said. “TransCanada’s own transmissions are pretty open about that. The multiplier effects in the economy are going to be temporary.”

And not all of the jobs associated with the pipeline will be new jobs, he said, many will go to existing Keystone employees and contractors.

According to the Institute’s analysis of Phase 1 of the Keystone pipeline, which was completed last year, only 11% of the construction and inspection workforce in South Dakota was hired locally. And the pipeline materials may be manufactured elsewhere, he said.

“If the first two phases of the project are any indication,” he said, “They will use steel from Canada and India.”

Forty percent of the steel for the first phase of the project came from Canada, he said, and ten percent from India, and if this model continues the spin-off manufacturing jobs will be in those countries.

State Dept. is expected to decide whether to grant a permit for the project by the end of the year.

The Dept. will hold hearings on the project this week in Port Arthur, Texas, Topeka, Kansas, Glendive, Montana, Lincoln, Nebraska, Austin, Texas, Pierre, South Dakota, Atkinson, Nebraska, and Midwest City, Oklahoma.

As the President considers whether to approve the controversial Keystone XL pipeline, a Republican bill in the U.S. House of Representatives would prohibit regulators from implementing safety rules recommended by the National Transportation Safety Board.

Pipeline safety emerged as a major concern last year after a rupture on a PG&E gas pipeline in San Bruno, Calif. leveled dozens of homes, killed eight, and injured many others. In Michigan the Enbridge pipeline rupture spilled more than 800,000 gallons of tar sands crude into the Kalamazoo River and sickened hundreds.

The agency charged with regulating the nations 2.5 million miles of pipelines, the Department of Transportation’s Pipelines and Hazardous Materials Safety Administration, became a target for reform as reports detailed the dept’s understaffing and heavy ties to industry.

Lawmakers from communities impacted by the recent disasters promised to strengthen pipeline oversight in legislation to reauthorize federal pipeline safety programs, but action has been slow, and a bill that moved through the House Transportation and Infrastructure Committee this month is distressingly weak, pipeline safety advocates say.

The Pipeline Safety, Regulatory Certainty, and Job Creation Act of 2011, sponsored by Bill Shuster (R-PA) requires the Dept. of Transportation to conduct a study on expanding “integrity management rules” for how pipeline operators test and monitor their lines for corrosion and other problems.

Under current rules PHMSA only requires regular testing on lines that run through “high consequence areas” — places that are highly populated or ecologically sensitive.

The Shuster bill prohibits regulators from expanding integrity management requirements beyond high consequence areas.

It also requires regulators to study and report on leak detection systems, but prohibits the dept. from developing new standards for leak detection systems or requiring operators to use them.

As the committee took up and reported the bill on Sept. 8, Carl Weimer, executive director of the Pipeline Safety Trust, criticized the measure as a “partisan industry-driven effort.”

“The weak nature of this proposed legislation seems to ignore the specific strong recommendations just a week ago from the National Transportation Safety Board (NTSB), and the voiced intention of many within the pipeline industry to use the tragedies of the past fifteen months as the impetus to move pipeline safety forward in many areas.”

The NTSB report on the San Bruno pipeline explosion recommended that PHMSA require all operators to equip systems with tools for detecting leaks, require automatic shut-off valves in high consequence areas, require pressure testing for all pre-1970 gas lines and implement enhanced oversight of pipeline integrity management programs.

Shuster’s bill neglects all of these items, Weimer said.

“Just last week NTSB recommended that to avoid more tragedies like San Bruno regulations should be changed to ‘require automatic shutoff valves or remote control valves in high consequence areas and in class 3 and 4 locations be installed,’” he said. “This bill, unlike the bill from House Energy and Power, does not even ask for a study of installing such important valves on existing pipelines through populated communities.”

In July the House Energy and Commerce Subcommittee on Energy and Power approved pipeline safety legislation that set deadlines for updating leak detection rules and automated valve use and placement, and strengthened guidelines for river crossings, and gas gathering lines.

The two House bills must now be reconciled.

Association of Oil Pipelines President and CEO Andy Black commended the House Transportation and Infrastructure Committee for “passing a strong reauthorization bills that wisely avoids imposing new regulations without sufficient evidence current regulatory requirements have failed.”

In an open letter, Sens. Barbara Boxer and Diane Feinstein (D-CA) warned that the House Transportation Committee bill would block important reforms and urged PHMSA to immediately adopt all of NTSB’s latest pipeline safety recommendations.

Last year’s U.S. Supreme Court decision in Citizens United v. Federal Election Commission granted corporations and unions the right to directly and expressly back political candidates, and triggered an enormous new wave of political spending. Now watchdog groups are trying to find ways to make sure voters can see who is funding which candidates.

In a web seminar sponsored by the Business Ethics Network last week, groups concerned about the role of money in politics gathered to review strategies for increased disclosure.

Norm Ornstein, a scholar with the American Enterprise Institute, who once helped craft the McCain-Feingold campaign finance act, said that he was struck and “even a little bit heartened” by the fact that Sarah Palin railed against crony capitalism during her Labor Day speech in Iowa saying, in effect, “what do we suppose those fat cats want for their money?”

“It suggests to me,” Ornstein said, “that there is at least a glimmer of a possibility that we might be able to build a very unusual type of coalition against what has become an utterly appalling landscape of influence peddling by enormous monied interests and more and more overt, almost shakedown schemes by political figures to get the money they want from corporations and individuals.”

The Citizens United decision did not strike down any rules that require disclosure of political spending, but loopholes in the tax system and lax campaign finance rules allow corporations to give money in ways that are very hard to track, disclosure advocates say.

According to an analysis by the Center for Responsive Politics in the 2010 election 67 percent of all outside (non political party) spending came from groups that had been freed to contribute by the Citizens United decision with non-profit 501(c) groups dominating spending on election ads.

IRS rules state that 501(c)(4) groups don’t have to name their contributors as long as electioneering is not their primary purpose, but this can be difficult to enforce in a meaningful way. Groups can form and carry out campaign work and then later switch to other activities so that political projects don’t appear to dominate their activities.

With Congress deadlocked over most issues, campaign finance reform advocates say it’s more prudent to focus on promoting regulatory measures that could increase disclosure.

One possibility would be to get the IRS to enforce its requirements for 501(c)(4)s. Another would be to get the Securities and Exchange Commission to require publicly traded companies to report their political spending to shareholders.

Aside from the way it could corrupt the political process, experts point out, unregulated corporate spending on politics poses risks for company shareholders.

Ten corporate law academics recently petitioned the SEC to adopt rules to require that corporations communicate with shareholders about political use of corporate funds.

The idea has support from major institutional investors including the International Corporate Governance Network, which represents $18 trillion in assets.

Any rule change at SEC will be a time consuming process. In the meantime some groups are trying to get corporations to voluntarily release information about their political spending.

Since 2003 the Center for Political Accountability has been working to get companies to establish rules for disclosure of political spending and shareholder oversight.

Valentina Judge of CPA said that such resolutions are good business practices that can protect companies from embarassing contributions that can cause reputational damage.

The Target corporation learned the pitfalls of political donations last year, she pointed out.

The company endured bad press and boycott threats after it made a $150,000 donation to a group that supported a candidate opposed to gay rights.

CPA is preparing to release an index of corporations that have adopted policies on corporate spending.

It’s urgent that groups focus on disclosure strategies that could work fast, said Craig Holman of Public Citizen.

“We just was a 427 percent increase in outside spending in the 2010 election,” he said, “This is a phenomenal increase … and this was just a test run, a trial. Corporations and CEOs were just starting to get involved and were pretty cautious.”

In the 2012 elections, he said, “I believe we are going to see numbers that are off the charts.”

The only thing that could force more disclosure right away would be an executive order from President Obama, he said.

“We need President Obama to step up to the plate and sign an order requiring enhanced political disclosure for contractors to show that contracts are being based on merit and not contributions.”

Another short term effort could involve getting the president to appoint a Federal Elections Commissioner who would work to require funding disclosure on television ads, said Meredith McGehee of the Campaign Legal Center.

The most pressing need, however, she said, is is a public education campaign to translate the current situation around corporate funded politics into terms that meet average Americans.

“You have to build a public base before you can get into specific answers,”
she said. “The pot is not yet boiling.”

“The reality is that the other side that is supporting this outcome is outgunning the reform community and those that see the problem by a million to one,” she said. “It doesn’t mean give up. It means you’ve got to start thinking about 21 century solutions and approaches.”

The primary beneficiary of the proposed Keystone XL pipeline is a company that wants to refine tar sands oil into diesel and ship it to Europe while avoiding taxes, according to a new report by Oil Change International.

TransCanada’s Keystone XL pipeline would move diluted bitumen — oil from the tar sands region of Northern Alberta, Canada — across the U.S. to refineries in the Houston area at the rate of 700,000 barrels per day.

Because the pipeline would involve a new U.S. border crossing it must obtain a presidential permit. In order to grant a permit, the State Dept. must find that the project serves the national interest.

The project has been presented by oil industry and government sources as a way to improve American energy security through increased trade with Canada, a county seen as more stable and U.S.-friendly than other oil-producing nations.

But in a new report that looks at data from the U.S. Energy Information Administration, corporate disclosures to investors and oil market analyst reports, the non-profit advocacy group Oil Change International argues that the pipeline would not enhance U.S. energy security.

U.S. oil demand is down due to a combination of increasing fuel efficiency and slow economic growth, and for the first time since 1970 domestic oil production is up thanks to shale oil production in North Dakota and Texas.

As a result of these factors, there is now a glut of oil in the U.S. and so refiners are looking for other markets. There is demand for diesel in Europe and not enough refineries in Latin America.

“The construction of the Keystone XL will not lessen dependence on foreign oil — rather, it will feed the growing trend of exporting refined products out of the United States, thereby doing nothing to stabilize oil prices or gasoline prices at the pump.”

It’s clear that Keystone XL is an export pipeline, the report says, because TransCanada already has contracts with companies that are openly planning to export oil.

The report says that TransCanada told the National Energy Board of Canada that it has secured long term contracts with six customers — Valero, Motiva, Total, Canadian Natural Resources, Cenovus/Enconaand Trafigura.

Valero, the report says, has agreed to use the pipeline to ship 100,000 barrels a day, 20 percent of the pipeline’s capacity until 2030.

At its Port Arthur refinery Valero is in the process of building a hydrocracker that will be able to convert tar sands oil into diesel and jet fuel for the global market.

“The growth market for the global trade in petroleum products is dominated by diesel,” the report says. “Valero’s strategy of converting its Port Arthur refinery to maximize diesel production through the processing of cheap, heavy sour crude from the Canadian tar sands is entirely focused on exporting the diesel into the global market.”

Refining the tar sands in Port Arthur, Texas will pollute the surrounding communities but it won’t bring much money in, the group says:

“… the Motiva, Total and Valero refineries in Port Arthur are within a Foreign Trade Zone, meaning they are exempt from customs duties on imports and exports as well as various state and local taxes,” the report says. “This amounts to a sizable subsidy to the oil industry to export refined oil products.”

Tar sands oil production creates far more greenhouse gas emissions than other types of oil and recent pipeline spills in the Midwest have underscored the hazards of transporting the Canadian crude. So for environmental concerns about the pipeline have dominated public debate over the project.

Oil Change International says in deciding whether to permit the pipeline the Obama Administration should focus on where the Keystone XL pipeline oil will go, saying, “An honest assessment of the Keystone XL project will show that the oil will be exported and will not benefit U.S. consumers or any reasonable definition of the nation’s interest.

Much of the attention on corn-based ethanol has focused on the role that this supposedly renewable fuel is playing in driving up global food prices. Now environmental groups and some conservative politicians are pointing out another problem — corn-based ethanol consumes the bulk of federal funding on renewable energy and the big oil companies that blend the ethanol into gasoline are collecting subsidies to the tune of about $6 billion a year.

The Volumetric Ethanol Excise Tax Credit (or VEETC) is a 45 cents per gallon credit that goes to the refiner that blends the ethanol into fuel.

Because the government already mandates that ethanol be added to gasoline and bans the import of foreign ethanol, critics say that the VEETC is unnecessary to maintain supply and is now only a handout to the oil industry.

British Petroleum has not been open about the benefits it receives from the credit, but is widely believed to be the largest recipient of the credit.

The National Journal reported last year:

On BP’s website, the firm states: “As one of the largest blenders and marketers of biofuels in the nation, we blended over 1 billion gallons of ethanol with gasoline in 2008 alone.” Extrapolating from Energy Information Administration data on 2009 refining capacity, BP is estimated to have produced about 11.5 billion gallons of gasoline. If the company blended up to the 10 percent limit under current law, about 1.15 billion gallons would have been blended, translating to a $518 million tax benefit.

This credit wasn’t among those that the Senate considered scrapping weeks ago, but there does appear to be some political will to cut it.

Though presidential candidates are known to pander to the interest of farmers in Iowa, which holds the first conventions, campaigning in Iowa last month former Minnesota governor and Republican presidential candidate Tim Pawlenty said that ethanol credits need to be rolled back.

“We need to do it gradually. We need to do it fairly. But we need to do it,” Pawlenty said. “The hard truth is that there are no longer any sacred programs.”

Candidate Newt Gingrich — who has received hundreds of thousands of dollars as a consultant for the ethanol group Growth Energy — is among the few Republicans campaigning who have not endorsed cuts to the VEETC, according to Sheila Karpf, legislative and policy analyst for the Environmental Working Group, which has been tracking the issue.

Karpf said that the credit was intended to make gas with ethanol more affordable but oil and gas companies are allow to collect the subsidy no matter how much profit they make.

Government credits for ethanol blenders are also problematic, she said, because they drain off resources that could support better renewable energy options.

“Corn ethanol actually increases greenhouse gases in the near term,” she said. This is because ethanol is mostly made in facilities that burn coal and natural gas.

Corn ethanol was supposed to be a bridge fuel that would lead to advanced bio-fuels from algae, switch grass or other sources, she said, but the multiple federal incentives aimed at corn have stifled development of this potentially superior alternatives.

“The fact that we are still paying VEETC is crazy,“ she said, “a really bad waste of taxpayer money.”

Legislation to end the VEETC has bi-partisan support in Congress.

In March Senators Tom Coburn (R-OK) and Ben Cardin (D-MD) introduced a bill to repeal the VEETC.

“While there are a wide range of federal incentives available for ethanol production, the VEETC essentially provides free money for blenders who are already mandated by the Renewable Fuels Standard (RFS) to blend ethanol in fuel,” they said in a statement as they introduced the bill.

“Moreover, while born of good intentions, federal subsidies for ethanol have had less than satisfactory results. Ethanol-blended fuel is nearly a third less efficient than gasoline (ethanol burns at 68 percent the energy content of gasoline), has contributed to the increased price of corn (as well as land, feed, and other input costs), and can cause engine damage in motor vehicles.”

A March Government Accountability Office report recommended that Congress reconsider the VEETC and stated that the U.S. Environmental Protection Agency and the Treasury Dept. could save the federal government $5.7 billion by addressing duplicative efforts aimed at increasing domestic ethanol production.

Opponents of ending tax breaks for big oil companies argue that closing tax loopholes will result in higher prices at the pump, but a report from the non-partisan Congressional Research Service finds that ending the tax breaks is unlikely to cause a rise in prices.

Senate Democrats are expected to push for a vote this week on the Close Big Oil Tax Loopholes Act of 2011, a bill to cut tax subsidies for Exxon Mobil, BP, ConocoPhillips, Shell and Chevron.

The money saved by closing these loopholes — estimated at $21 billion over 10 years — would be used to pay down the deficit.

“At a time when families are feeling the pain at the pump and our deficit keeps growing at an alarming rate, we simply can’t afford to keep giving away billions in taxpayer handouts to oil companies that are doing nothing to help lower prices,” said bill sponsor Sen. Robert Menendez (D-N.J.) “The ‘Close Big Oil Tax Loopholes Act’ is based on a simple premise: we need everyone to do their share to lower the deficit, not just working families and the elderly.”

The bill would eliminate five special oil company exemptions.

In a Senate committee hearing last week, the leaders of Exxon Mobil, BP, ConocoPhillips, Shell and Chevron called the proposal anti-completive and discriminatory and warned that it would threaten American jobs and harm innovation.

But with gas prices over $4 per gallon in much of the country, many Americans are most concerned with high fuel costs.

A report prepared for Sen. Harry Reid (D-Nev.) by the Congressional Research Service says that eliminating tax breaks for large oil companies is unlikely to have much affect on gasoline prices, because crude oil is the largest factor in the price of gas, and the price of crude oil is set by world market.

The tax changes are unlikely to affect oil output, the price of oil and, consequently, the price of gas, CRS found in an analysis of five breaks targeted by Democrats.

The Domestic Manufacturing Deduction

Oil companies get a 6 percent deduction in net income for domestic production.

Ending this would be equivalent to an increase on the tax on corporate profit, CRS said.

It is widely accepted that a proportional change in taxes on profit affects neither the firm’s incremental costs or revenues, and therefore does not change its behavior with respect to output. Since output does not change, there is little reason to believe that the price of oil, or gasoline, consumers face will increase.

The price of oil is high enough to provide incentive for continued production in the U.S, CRS said.

With current oil prices at, or near, $100 per barrel in the United States, it is unlikely that firms will slow production, or close wells as the result of the loss of the Section 199 deduction.

Intangible Drilling Costs

For nearly a century, oil and gas companies have been allowed to take immediate deductions for costs associated with exploring for oil. This was designed to enhance investment returns for financing risky exploration activities. But with oil prices high, companies don’t need incentives to explore. CRS:

Repeal of the immediate expensing of intangible drilling costs provision and replacement with a form of cost amortization more consistent with depreciation methods common in other industries likely will have no effect on current U.S. oil production, and hence no effect on current gasoline prices.

Dual Capacity Rules

Since the 1950s oil companies have been allowed to deduct the tax payments they make to other countries.

These tax payments are broadly defined, and, according to the Center for American Progress, companies have been allowed to claim credits for payments in countries that have little or no business tax.

CRS said that since elimination of this break amounts to a tax on profit it should have no effect on output or pricing decisions, and therefore no effect on the price of gasoline.

“The incidence of the tax would appear to be on shareholders.”

Oil companies are allowed to deduct a flat percentage of revenues from a well. This break is called “percentage depletion.” CRS says that it has been eliminated for most companies and should not be a factor in investment and pricing decisions by the five major oil companies.

The companies are also allowed to deduct the cost of tertiary injectants used in drilling. CRS found that the cost of ending this tax break would be very small for industry.

“[T]he five major oil companies, to which repeal would apply, earned over $32 billion in net income in the first quarter of 2011. Repeal of the [tertiary injectant] deduction for the industry is estimated by the Obama administration to yield only $6 million in revenue in 2012.”

The tax revenue generated by ending these five exemptions is expected to be 5 percent of the earnings of the largest oil companies, the report found.

The U.S. has 23 GE Mark 1 reactors like the Fukushima Daiichi Unit 1 which exploded and released radiation over the weekend — including the Monticello plant here in Minnesota.

The Heritage Foundation sent around an e-mail today claiming that the events unfolding in Japan should have no impact on plans to expand nuclear power in the U.S.

“The Nuclear Regulatory Commission does not need to regulate more in response to this,“ the Foundation said in Morning Bell: Nuclear Facts to Remember While Following Japan. “We need to remember that nuke plants are privately owned and that their owners have every incentive to maintain safe operations. The government’s role should simply be to set and enforce fair, efficient, and effective safety and environmental standards and allow private industry to meet them.”

“The plant in trouble in Japan is over 40 years old.” the foundation said. “Today’s designs are far more advanced.”

Reuters, however, reports that there are there are 23 GE Mark 1 reactors operating in the U.S. now and five of them are at least 40 years old.

Reactor Location Size (MW) Year
Browns Ferry 1 Decatur, AL 1065 1974
Browns Ferry 2 Decatur, AL 1104 1975
Browns Ferry 3 Decatur, AL 1105 1977
Brunswick 1 Southport, NC 938 1976
Brunswick 2 Southport, NC 920 1975
Cooper Nebraska City, NE 770 1974
Dresden 2 Morris, IL 867 1970
Dresden 3 Morris, IL 867 1971
Duane Arnold Cedar Rapids, IA 580 1975
Hatch 1 Baxley, GA 876 1975
Hatch 2 Baxley, GA 883 1979
Fermi 2 Monroe, MI 1122 1988
Hope Creek Hancock’s Brdg, NJ 1161 1986
Fitzpatrick Oswego, NY 854 1976
Monticello Monticello, MN 572 1971
Nine Mile Point 1 Oswego, NY 621 1969
Oyster Creek Toms River, NJ 615 1969
Peach Bottom 2 Lancaster, PA 1112 1974
Peach Bottom 3 Lancaster, PA 1112 1974
Pilgrim Plymouth, MA 685 1972
Quad Cities 1 Moline, IL 867 1972
Quad Cities 2 Moline, IL 867 1972
Vermont Yankee Vernon, VT 620 1972

As the U.S. State Deptartment considers a proposal to build a nearly 2,000-mile long pipeline to transport Canadian tar sands to refineries on the Gulf Coast, key questions about the safety of moving tar sands by pipeline remain unanswered, watchdog groups warned this week.

Alberta tar sand is a low grade asphalt-like petroleum product, also known as bitumen, that is strip-mined or melted out of the ground and requires elaborate processing in order to be used as fuel.

Previously tar sands oil was refined in Canada and was transported via pipeline for use in the U.S. Now, with Canadian refineries at capacity, the gooey raw tar sands is mixed with lighter chemicals (natural gas condensate) to make it thin enough to pump and sent to the Midwest for refining via those same pipelines.

In a report (PDF) presented this week, the National Resources Defense Council, Pipeline Safety Trust and Sierra Club warned that diluted bitumen, or DilBit, is more acidic and has more abrasive quartz sand particles, dramatically increasing corrosion dangers on pipelines.

“Without much public knowledge or a change in safety standards,” the report states, “U.S. pipelines are carrying increasing amounts of the corrosive raw form of tar sands oil. In fact, over the last ten years, DilBit exports to the United States have increased almost fivefold, to 550,000 barrels per day (bpd) in 2010.”

The report compares spill data for the U.S. and Canadian pipeline systems and finds that the Alberta liquid pipeline system, which handles more DilBit, has experienced 16 times as many spills caused by internal corrosion.

Pressure changes within pipelines can cause the natural gas liquids in DilBit to move from liquid to gas, forming a bubble that can slow the flow of oil through the line, the report states. This phenomenon — column separation — can look like a leak to pipeline monitors and can cause real leaks to go unnoticed.

“Because the proper response to column separation is to pump more oil through the pipeline, misdiagnoses can be devastating,” the report asserts.

Initial National Transportation Safety Board review of the Enbridge pipeline rupture that spilled an estimated million gallons of DiBit into the Kalamazoo River watershed in Michigan last summer indicates that confusion over apparent column separation may be a partial explanation for why it took operators more than half a day to respond to that leak.

The economic and environmental costs of cleaning up a DilBit spill can be more severe than in conventional oil spills, the report states.

[U]nlike conventional crude oils, the majority of DilBit is composed of raw bitumen which is heavier than water. Following a release, the heavier fractions of DilBit will sink into the water column and wetland sediments. In these cases, the cleanup of a DilBit spill may require significantly more dredging than a conventional oil spill. Further, heavy oil exposed to sunlight tends to form a dense, sticky substance that is difficult to remove from rock and sediments. Removing this tarry substance from
river sediment and shores requires more aggressive cleanup operations than required by conventional oil spills.

The report authors note that the DilBit spill from the Enbridge pipeline in Michigan is not yet cleaned up, in part because submerged oil remains a problem in the Kalamazoo River.

These cleanup difficulties, now playing out in Michigan, were forecast by the U.S. Environmental Protection Agency last summer in a letter (PDF) asking for more study on tar sands pipeline safety.

EPA warned that diluted bitumen may not behave like conventional oil in a spill and may be more difficult to clean up with “floating oil” spill response equipment and other traditional measures.

Concern about the environmental risks of tar sands pipelines is running high in Nebraska where TransCanada’s propose Keystone XL pipeline would cross the Ogallala aquifer — source of drinking water for million and the ‘life blood of agriculture.’

Ken Winston of the Nebraska Sierra Club said that TransCanada is acting like a used car salesman trying to close a deal before the prospective buyer realizes the defects in a vehicle.

“This report is like a warning light going off in that vehicle,” he said.

Information about the dangerous properties of tar sands oil is all the more troubling in view of statements by TransCanada on how it will supervise its planned line, Winston said.

At a Natural Resources Commission hearing (PDF) in the Nebraska Legislature in December, TransCanada Corporation vice president Robert Jones acknowledged that the company’s automated monitoring systems would not detect all leaks.

“I can tell you that we will be able to find small leaks in what we consider to be in that 1 to 2 percent range,“ he said. “… If there’s a thousand barrels that doesn’t add up every minute, then the computer is going to start trying to figure out where that may be.”

Jones said that TransCanada plans to rely on adjacent landowners to inform company about leaks below that threshold.

“Sounds pretty good,” Winston said, “but when they are talking about 880,000 barrels a day one percent would be almost 9,000 barrels. A barrel is 55 gallons. We are talking potentially 40,000-50,000 gallons could be undetected — a rather significant amount.”

The Natural Resource Defense Council, Pipeline Safety Trust and Sierra Club are calling on the U.S. Dept. of Transportation and pipeline operators to evaluate the need for new standards for tar sands pipeline and improved spill response planning and they say that the Keystone XL pipeline approval process should be put on hold until the U.S. has stronger safety regulations for DilBit pipelines.

Pipeline Transportation Safety Improvement Act of 2011 introduced by Sen. Frank Lautenberg (R-N.J.) would require research into the pipeline safety issues posed by DilBit and overhaul of the nation’s pipeline safety system.

This bill was also introduced last year and died in committee.

The first of several promised clashes over U.S. Environmental Protection Agency regulatory powers came this week at a hearing over a Republican bill that would block the agency from regulating greenhouse gases out of concern for climate change.

At a heated Wednesday hearing by the House Energy and Commerce Subcommittee on Energy and Power EPA Director Lisa Jackson was questioned for hours about the impact of new Clean Air Act regulations on business.

Since the beginning of the year, EPA has required industry to report their CO2 emissions, and major new sources of pollution are required to conduct an analysis of the “Best Available Control Technology” for reducing CO2 emissions. EPA has also announced that it will propose greenhouse gas standards for utilities and refineries this year and finalize them next year.

“Let’s face it,” said House Energy and Power Subcommittee Chairman Rep. Ed Whitfield (R-Ky.), “these regulations and others from EPA amount to a war on domestic coal. Coal is the energy source America possesses in the greatest abundance. It provides half the nation’s electricity and 92 percent in my home state of Kentucky, and it does so because it is affordable.”

Whitfield, together with House Energy and Commerce Committee Chair Fred Upton (R-Mich.) and Sen. James M. Inhofe (R-Okla.) ranking member of the Senate Committee On Environment and Public Works, are the sponsors of the Energy Tax Prevention Act of 2011.

The bill states:

The Administrator may not, under [the Clean Air Act], promulgate any regulation concerning, take action relating to, or take into consideration the emission of a greenhouse gas due to concerns regarding possible climate change.

In her testimony, Jackson called the Clean Air Act a public health measure that has prevented 205,000 deaths since 1990, and she said that the agency move to regulate greenhouse gas emissions was a necessary science-based decision aimed at protecting the country from the public health threat that is climate change.

Jackson also pointed out that EPA’s responsibility to regulate carbon emissions was acknowledged (PDF) by her predecessor in the Bush administration.

“Chairman Upton’s bill would, in its own words, ‘repeal’ the scientific finding regarding greenhouse gas emissions, she said. “Politicians overruling scientists on a scientific question — that would become part of this committee’s legacy.”

But many lawmakers and witnesses at the hearing seemed comfortable with such a legacy.

Any EPA regulation of greenhouse gases will be “all pain and no gain” said Rep. Inhofe. “[I]t is unfair and unacceptable to ask the steel worker in Ohio, the chemical plant worker in Michigan, and the coal miner in West Virginia to sacrifice their jobs so we can reduce temperature by a barely detectable amount in 100 years.”

Nucor Steel environmental manager Steve Rowlan told the committee that uncertainly about greenhouse gas rules caused his company to scale down a new iron facility in Louisiana.

The impact of these new regulations on capital projects is real. We recently received a permit, under the new GHG rules, for a direct reduced iron facility in Louisiana. This is a $750 million project that will create 500 construction jobs and 150 permanent ones. It is a great job-creating investment, particularly in this economy. But this project is not as large as the $2 billion investment we initially intended. Due to the uncertainty created by these regulations, we made the difficult decision to delay the $2 billion investment, also delaying the creation of 2,000 construction jobs and 500 permanent ones.

Rowlan said that his biggest concern is that future EPA carbon regulations could increase the cost of electricity.

“Cheap energy is lifeblood of industry,” he said in an interview with The American Independent. “You always hear people say, ‘We need clean green power’ well we need ‘Clean, green, affordable and reliable power.’”

Steve Cousins, vice president of Lion Oil of El Dorado, Ark., told the committee that he is troubled by the EPA requirement that any expansion of refinery operations involve implementation of best available control technology for greenhouse gas emissions.

“It is unclear what technology constitutes BACT,“ he said. “EPA’s federal guidance on what defines BACT is far too broad and confusing regarding what measures our refinery would be able to employ to control emissions, and whether permits would actually be approved and issued in certain circumstances.”

U.S. Steel Corporation environmental manager Fred Harnack said that EPA carbon rules will not reduce global greenhouse gas emissions.

Since greenhouse gas emissions are a complex global issue, a simplistic regulatory approach may reduce greenhouse gas emissions locally (in United States) while increasing emissions outside the United States by encouraging companies to move or expand operations to another country. As demonstrated by the United Kingdom’s example, energy-intensive manufacturing activity will decline, but consumer demand for energy-intensive goods will still grow. The net environmental effect of such is actually worse for the environment as goods are sourced from less efficient producers and additional long-distance transportation is required.

In a memo (PDF) to Democratic members of the Energy and Power Subcommittee, Rep. Henry Waxman (D-Calif.), ranking member of the Energy and Commerce Committee, and Rep. Bobby Rush (D-Ill.), ranking member of the Energy and Power Subcommittee, said that the Upton bill would threaten implementation of renewable fuel standards and create legal uncertainty about the status of the recent motor vehicle standards adopted by EPA.

An ORC International poll conducted earlier this month found the 63 percent of people — including most Republicans — believe the EPA needs to do more to hold polluters accountable and protect the air and water.

That survey found that only 18 percent of Americans believe that Congress should block the EPA from updating pollution safeguards.