New initiative will promote safety improvements for oil by rail

While rail transportation has proven an efficient means of transporting North America’s growing supply of crude oil, increased oil by rail traffic has also raised serious environmental and safety concerns in recent years.

Following several recent, high-profile accidents by trains transporting crude oil – including a December derailment in North Dakota in which 400,000 gallons of crude oil were spilled – the Department of Transportation (DOT) and Association of American Railroads (AAR) have come together to announce the roll out of new safety measures for crude by rail operations.

The agreement institutes an array of new safety measures to prevent train derailments, including implementation of new, more effective breaking technology and traffic routing technology that determines the safest and most secure routes, increased track inspections, and reduced speed requirements through designated urban areas.

“Our rail safety procedures must keep pace with the rapidly changing landscape of North American oil production,” Senator Coons said. “In January, a derailment in Philadelphia nearly ended in disaster, and over the last year, devastating crashes in communities from North Dakota to Alabama have underscored the need to update and strengthen freight safety measures. The improved safety procedures announced by DOT and AAR are an important step in what must be a sustained effort to protect our communities and environment from future disasters.” 

North American oil production has expanded rapidly in recent years thanks to growing production in the Canadian oil sands and increased shale oil production in North Dakota, Montana, and Texas. Nearly 70 percent of the United States’ crude oil demand is now supplied from production in North America, displacing imports from overseas. This crude oil boom has created new transportation challenges as producers have increasingly turned to rail to transport oil to refineries in market hubs across the U.S., including PBF’s refinery in Delaware City.

According to rail industry estimates, U.S. freight railroads carried more than 400,000 carloads of crude oil in 2013, compared to 9,500 carloads in 2008. In just the last three years, crude imports by rail from Canada have increased more than 20-fold. PBF’s Delaware City Refinery, which directly supports 500 jobs in Delaware, receives 1-2 unit trains of Bakken crude oil shipments per day.

Governors of 23 states call for MLP parity

A coalition of governors from 23 states wrote to Senator Coons Thursday to thank him for his efforts to create cheaper, cleaner energy. In the letter, the governors called for the passage of the Master Limited Partnerships Parity Act. The legislation was co-sponsored by Senators Jerry Moran (R-Kan.), Debbie Stabenow (D-Mich.), and Lisa Murkowski (R-Alaska).

The bill would make it easier and cheaper for investors to fund a broad range of clean energy projects including wind, solar, fuel cells, and energy efficient buildings. The Governors Wind Energy Coalition’s letter states that “the Master Limited Partnership structure can help reduce the cost of capital and attract more investors to our states.”

The legislation expands access to a business structure known as "master limited partnerships." Since 1987, the ability to form a master limited partnership has been mostly limited to projects involving oil and gas pipelines. This has allowed those industries to explode in size and attract huge amounts of investment. This letter reflects that the reality that equal access to financing for all sources of energy makes sense, regardless of party or regional affiliation. From Hawaii to Iowa and from Maryland to Montana, governors see that master limited partnerships make sense and passage of Senator Coons’ legislation is a step towards a better energy future.

The following states are members of the Governors Wind Energy Coalition: Arkansas, California, Colorado, Delaware, Hawaii, Illinois, Iowa, Kansas, Kentucky, Maryland, Massachusetts, Michigan, Minnesota, Montana, New Mexico, New York, North Dakota, Oklahoma, Oregon, Pennsylvania, Rhode Island, South Dakota, and Washington

Senate analyzes global energy trends

The Senate Committee on Energy and Natural Resources held an oversight hearing today on the U.S. and global energy outlook for 2012. Each year, the committee holds a similar hearing to focus on recent trends in energy production and consumption in the U.S. and around the world.

“While Americans have become more aware of their energy consumption, we still have a long way to go to create a clean energy world,” Senator Coons, a member of the Energy Committee, said. “I’m encouraged by a number of the findings that were discussed in today’s hearing and will continue to work with my colleagues on the Committee to champion clean energy and energy efficiency, which will not only boost our economy and create jobs, but also increase our national security and improve our environment.”

Some of today’s noteworthy domestic findings include:

• The energy intensity of the U.S. economy is expected to decline by 42 percent between 2010 and 2035
• Oil imports, as a share of total U.S. oil consumption,  are expected to decline from 49 percent in 2010 to 36 percent in 2035, with the decline attributable to:
  
  • U.S. natural gas prices are expected to remain below $5 per thousand cubic feet
  • U.S. greenhouse gas emissions from energy-related sources are expected to remain below 2005 levels throughout the forecast period

Key findings of the latest World Energy Outlook include:

• China and India together will account for 50 percent of global energy demand growth between 2010 and 2035
• Renewable energy, followed by natural gas, will meet much of the energy demand growth over the forecast period.  In contrast, almost half of the energy demand growth between 2000 and 2010 was met with coal
• While the U.S., Europe, and Japan will all be less reliant on imported oil in 2035, China and India will be sharply more reliant on imported oil than they are today
• If the world uses less nuclear power than expected, in the wake of the Fukushima disaster, demand for coal and natural gas will increase, and greenhouse gas emissions from the power sector will also increase

A panel of four witnesses testified at the oversight hearing: The Energy Information Administration’s Acting Administrator and Deputy Administrator Dr. Howard Gruenspecht; the International Energy Agency’s Deputy Director Ambassador Rickard Jones; PFC Energy’s Partner and Head of Financial Advisory Mr. Roger Diwan; and Cambridge Energy Research Associates’ Managing Director Mr. Jim Burkhard.

Click here to learn more about Chris’ work to advance clean energy initiatives.

Senator Coons offers support to President’s plan for boosting biofuels industry

Senator Coons today praised President Obama’s announcement of a partnership between the U.S. Departments of Agriculture, Energy and Navy to invest up to $510 million over the next three years to produce advanced drop-in aviation and marine biofuels to power military and commercial transportation.

“If we’re going to shake our nation’s dependence on foreign oil, we’ve got to support emerging alternative energy sources like biofuels,” Senator Coons said. “We hear a lot about the enormous potential biofuels have not only for diversifying our energy consumption but for creating jobs across the country, so it’s important that our actions match our rhetoric and that our government leads the way. But it’s just as important that the private sector keep pace, which is why this creative plan is important.”

The plan, which you can download as a PDF here, calls for the Department of Energy to invest in the technology necessary for producing biofuels, while the Department of Agriculture takes steps to ensure that biofuel production doesn't harm the food supply. The Navy will use the new biofuels in its fleet.

You can read more about the announcement here in Politico.

New fuel standards and creating jobs for Delaware

In a win-win-win for the environment, the nation, and consumers, the White House on Friday announced an historic agreement with 13 major automakers to pursue the next phase in the Administration’s national vehicle program, increasing fuel economy to 54.5 miles per gallon for cars and light-duty trucks by Model Year 2025. This will go a long way as we try to decrease our dependence on petroleum and reduce greenhouse gas emissions from the transportation sector.

The President was joined in the agreement by Ford, GM, Chrysler, BMW, Honda, Hyundai, Jaguar/Land Rover, Kia, Mazda, Mitsubishi, Nissan, Toyota and Volvo – which together account for over 90% of all vehicles sold in the United States – as well as the United Auto Workers (UAW), and the State of California, who were integral to developing this agreement.

These new standards will save American families money at the pump, for a total of $1.7 trillion in fuel savings over the life of the program. The standards will cut our oil dependence, reducing oil consumption by an estimated 2.2 million barrels a day in 2025 (eventually reaching more than 4 million barrels a day as the fleet turns over), and saving 12 billion barrels in total over the lifetime of the program. And they will clean up our environment, cutting greenhouse gas emissions by more than 6 billion metric tons over the life of the program, while reducing pollutants like air toxics, cause soot, and smog. 

In addition to saving fuel, the new standards will help spur the development of advanced vehicle technology such as the plug-in hybrid electric vehicles to be produced in the new Fisker production facility in Delaware. The Fisker Karma pictured below is the world’s first premium plug-in hybrid electric vehicle.

Senator Coons hosts discussion on clean energy innovation and sustainability

Senator Coons hosted a luncheon today in the historic Kennedy Caucus Room of the Russell Senate Office Building to discuss clean energy innovation and sustainability.  Organized in cooperation with the American Chemical Society and the American Institute of Chemical Engineers, the luncheon featured researchers discussing carbon capture technologies, nuclear power, and renewables.  Today’s luncheon was the first of two; in June a second discussion will be held focusing on clean energy innovation.   

Chris opened the discussion with his observation that a century ago windmills dotted the American landscape and those in rural communities routinely lived in houses constructed from natural and composted materials.  He recalled a photograph of his grandmother as an infant in front of her family’s sod house in rural Wyoming, comparing it to new green home designs today that incorporate sod and composted soils.  For much of the past hundred years, Chris noted, we as a society failed to recognize the negative implications of our industrial development on health, the environment, and on sustainability. 

Praising Administration efforts to encourage and invest in broad-based research, development, and innovation in clean energy, Chris called on policymakers to take a long view when approaching this issue.  We won’t be able to meet our energy and environmental challenges without a strong program of research in science and engineering, and this is why Department of Energy programs like ARPA-E, Innovation Hubs, and Energy Frontier Research Centers are so important and worthwhile ventures. 

A member of the Senate Energy and Natural Resources Committee and the Budget Committee, Chris has been a vocal advocate of expanding and creating new tax credits for small businesses conducting innovative research, including research into clean energy technologies. 

To learn more about Chris’s energy priorities and his work on the Energy and Natural Resources Committee, click here. 

The American Chemical Society is a Congressionally-chartered, independent membership organization representing professionals at all degree levels and in all fields of chemistry.  The American Institute of Chemical Engineers is a professional organization for chemicals engineers with 40,000 members and student chapters at universities around the world.  

Video: Senator Coons speaks out against taxpayer subsidies for oil companies

Set to speak on the floor during morning business on Wednesday in honor of National Police Week, U.S. Senator Coons also responded to comments made moments earlier by Senate Republican Leader Mitch McConnell accusing Democrats of “picking winners and losers” by attempting to repeal tax subsidies for the nation’s largest oil companies.

“We just heard a comment on the floor that we need to stop picking winners and losers and need to move forward in helping America end its dependence on foreign energy,” Senator Coons began. “I couldn't agree more because the expenditures through our tax code — the billions and billions of dollars in needless expenditures through our tax code that continue to subsidize some of the most wildly profitable corporations in American history — is exactly that: picking winners. And the losers are the American people.”

At issue was a bill cosponsored by Senator Coons to end tax breaks for the nation’s five largest oil companies and instead use the savings that would be recouped to reduce the federal deficit. That Senate failed to invoke cloture on Tuesday night when all but two Republicans voted against the measure.

“This isn't picking on one particular industry,” Senator Coons said. “This is rationally looking at our immense tax expenditures through the code and saying there is a time here for us to stop. We would save literally $21 billion by fiscal year 2021.” 

Read the full text of the remarks here.

Chart: Number of crude oil rigs in operation in the U.S.

One of the tenets of the energy policy supported by Senator Coons, President Obama, and Senate Democrats is that American oil companies ought to be utilizing as much of the area they've received permits for as they possibly can rather than letting them continue to sit idle. The good news is that according to data from the U.S. Energy Information Administration, the number of crude oil rigs in operation in the U.S. has actually more than doubled since President Obama took office. That's a good sign that we're making inroads toward energy independence.

Marking the one-year anniversary of the BP Deepwater Horizon oil spill

Today marks the one-year anniversary of the explosion on the Deepwater Horizon oil rig that killed 11 workers and led to the worst marine oil spill in history.  Before the ruptured well was finally capped five months later, roughly 4.9 million barrels of crude oil had spewed into the Gulf of Mexico.  There are estimates that at the height of the spill this equated to more than one Exxon Valdez per week flowing from the broken pipe.  

The flow of oil had detrimental effects on wildlife and Gulf ecosystems, and severely impacted local economies that depend on the fishing, tourism and other coastal resource-based industries.  While no energy resource is risk or cost-free, we need to ensure that an ecological disaster of this size and scope is prevented from ever occuring again.

In May 2010, President Obama created the National Commission on the BP Deepwater Horizon Oil Spill and Offshore Drilling with the goal of providing recommendations on how the United States can prevent and mitigate the impact of future spills that result from offshore drilling.  The Commission released its final report earlier this year, stating that errors and misjudgments by the three companies -- BP, Transocean, and Halliburton – all contributed to the disaster.  The Commission found that it was “foreseeable and preventable” and made recommendations to address systemic problems across the oil industry’s risky business practices and the federal government’s and lax regulation enforcement. 

Chris looks forward to working to working with his colleagues on the Senate Energy and Natural Resources Committee to address the Commission’s recommendations.  He believes that we must continue to work on updating our safety and environmental regulations for offshore drilling and that we must also ensure that the ecosystems of the Gulf are fully recovered from this disaster and that Gulf Coast communities are fairly compensated for their losses. 

Chris also understands that new regulations and enforcement, as well as changes in industry culture, are only part of the solution.  If we are truly serious about preventing future environmental disasters as well as reducing our dependence on oil, the commonsense recommendations of the Commission can help lead the way, but we have to do more.  We should also take longer-term steps to restore and diversify the Gulf with both traditional and renewable energy technologies. Chris believes that we must make fundamental changes in our energy systems so that we use our energy resources more wisely and efficiently. Furthermore, we must continue to invest in clean, renewable energy in order to transition our nation beyond fossil-based fuels.

In Delaware, we are lucky to have alternative different offshore energy resource in abundance – wind.  Delaware and other mid-Atlantic states are working hard to develop a robust offshore wind industry and lead the country in the utilization of this important resource.   Chris joined Secretary of the Interior Ken Salazar when he announced the new “Smart from the Start” initiative, which will better facilitate citing, leasing and construction of new energy projects.  Watch Senator Coons at the “Smart from the Start” announcement.  This is an important step toward renewable energy adoption, energy independence, and new high tech jobs for our region.  Thanks to “Smart from the Start” it will be easier for Delaware to tap into our wind energy potential. 

How we power our future is one of the most critical questions of our time because it has far-reaching implications for our economy, national security, and environment.  Offshore wind is only part of the clean energy picture, but an incredibly important one for Delaware that will bring jobs, economic growth, and home grown clean energy to our state.  Chris is committed to making sure that the government plays a proactive role in promoting innovation, manufacturing, and construction in the clean energy field, as well as ensuring proper regulation of our industries so that oil spills and other preventable disasters become a thing of the past.    

House budget proposal could lead to higher gas prices

In Delaware, the average gas price has reached $3.51 a gallon and everyone is feeling a pinch at the pump. The federal agency dedicated to monitoring the oil market for abuse and speculation, which protects consumers, has been working hard to keep market-manipulation at bay. The Commodity Futures Trading Commission (CFTC) has been consumers’ cop on the beat since its creation in 1975, safeguarding against fraud and abuse that lead to higher consumer prices.

It is unfortunate that the budget passed by House Republicans earlier this year would slash the CFTC’s operational budget by one-third. This would severely limit that agency’s ability to protect consumers and keep market-manipulators from driving gas prices even higher. According to CFTC Chairman Gary Gensler, such a cut would lead to “significant curtailment of staff and resources.”

Senator Coons and forty-seven other Senate Democrats sent a letter today to Senate Republican Leader Mitch McConnell warning about the risk of holding back key resources from the CFTC, especially at a time when gas prices are already high. Equally disturbing, they wrote, are the House Republicans’ cuts to a range of programs focused on developing alternative sources of energy, including clean fuel technologies that will help wean us off our dependence on foreign oil.

In their letter, Chris and other Senate Democrats called for real bipartisan solutions to our energy problems, particularly a “sensible fiscal policy that invests in what we need to grow and cuts what doesn’t, without undermining our mission to transition to a safe, clean, and affordable future.”

Click here to read the full letter, and for a complete list of the senators who signed it.