[House Hearing, 116 Congress]
[From the U.S. Government Publishing Office]
THE IMPORTANCE OF PUBLIC DISCLOSURE REQUIREMENTS FOR PROTECTING HUMAN
HEALTH, THE CLIMATE, AND THE ENVIRONMENT, ON THE FOLLOWING BILL, AND
OTHER RELATED MEASURES: H.R. 5636, ``TRANSPARENCY IN ENERGY PRODUCTION
ACT OF 2020''
=======================================================================
LEGISLATIVE HEARING
before the
SUBCOMMITTEE ON ENERGY AND
MINERAL RESOURCES
of the
COMMITTEE ON NATURAL RESOURCES
U.S. HOUSE OF REPRESENTATIVES
ONE HUNDRED SIXTEENTH CONGRESS
SECOND SESSION
__________
Tuesday, January 28, 2020
__________
Serial No. 116-29
__________
Printed for the use of the Committee on Natural Resources
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
Available via the World Wide Web: http://www.govinfo.gov
or
Committee address: http://naturalresources.house.gov
______
U.S. GOVERNMENT PUBLISHING OFFICE
39-615 PDF WASHINGTON : 2020
COMMITTEE ON NATURAL RESOURCES
RAUL M. GRIJALVA, AZ, Chair
DEBRA A. HAALAND, NM, Vice Chair
GREGORIO KILILI CAMACHO SABLAN, CNMI, Vice Chair, Insular Affairs
ROB BISHOP, UT, Ranking Republican Member
Grace F. Napolitano, CA Don Young, AK
Jim Costa, CA Louie Gohmert, TX
Gregorio Kilili Camacho Sablan, Doug Lamborn, CO
CNMI Robert J. Wittman, VA
Jared Huffman, CA Tom McClintock, CA
Alan S. Lowenthal, CA Paul A. Gosar, AZ
Ruben Gallego, AZ Paul Cook, CA
TJ Cox, CA Bruce Westerman, AR
Joe Neguse, CO Garret Graves, LA
Mike Levin, CA Jody B. Hice, GA
Debra A. Haaland, NM Aumua Amata Coleman Radewagen, AS
Joe Cunningham, SC Daniel Webster, FL
Nydia M. Velazquez, NY Liz Cheney, WY
Diana DeGette, CO Mike Johnson, LA
Wm. Lacy Clay, MO Jenniffer Gonzalez-Colon, PR
Debbie Dingell, MI John R. Curtis, UT
Anthony G. Brown, MD Kevin Hern, OK
A. Donald McEachin, VA Russ Fulcher, ID
Darren Soto, FL
Ed Case, HI
Steven Horsford, NV
Michael F. Q. San Nicolas, GU
Matt Cartwright, PA
Paul Tonko, NY
Jesus G. ``Chuy'' Garcia, IL
Vacancy
David Watkins, Chief of Staff
Sarah Lim, Chief Counsel
Parish Braden, Republican Staff Director
http://naturalresources.house.gov
------
SUBCOMMITTEE ON ENERGY AND MINERAL RESOURCES
ALAN S. LOWENTHAL, CA, Chair
PAUL A. GOSAR, AZ, Ranking Republican Member
Mike Levin, CA Doug Lamborn, CO
Joe Cunningham, SC Bruce Westerman, AR
A. Donald McEachin, VA Garret Graves, LA
Diana DeGette, CO Liz Cheney, WY
Anthony G. Brown, MD Kevin Hern, OK
Jared Huffman, CA Rob Bishop, UT, ex officio
Matt Cartwright, PA
Raul M. Grijalva, AZ, ex officio
------
CONTENTS
----------
Page
Hearing held on Tuesday, January 28, 2020........................ 1
Statement of Members:
Gosar, Hon. Paul A., a Representative in Congress from the
State of Arizona........................................... 4
Lowenthal, Hon. Alan S., a Representative in Congress from
the State of California.................................... 1
Prepared statement of.................................... 3
Statement of Witnesses:
Goldman, Gretchen, Research Director, Center for Science and
Democracy, Union of Concerned Scientists, Washington, DC... 17
Prepared statement of.................................... 19
Mason, Susan, Managing Partner, Aligned Partners; and
Founding Member, Business Coalition for Conservation and
Climate, San Francisco, California......................... 6
Prepared statement of.................................... 8
Snover, Victor, Mayor, Aztec, New Mexico..................... 9
Prepared statement of.................................... 11
Stein, Kenneth, Policy Director, Institute for Energy
Research, Washington, DC................................... 14
Prepared statement of.................................... 16
Additional Materials Submitted for the Record:
National Mining Association, April 28, 2014 Letter to Dr.
Jean Rogers, The Sustainability Accounting Standards Board. 38
----------
LEGISLATIVE HEARING ON THE IMPORTANCE OF PUBLIC DISCLOSURE REQUIREMENTS
FOR PROTECTING HUMAN HEALTH, THE CLIMATE, AND THE ENVIRONMENT, ON THE
FOLLOWING BILL, AND OTHER RELATED MEASURES: H.R. 5636, TO PROVIDE FOR
THE ACCURATE REPORTING OF FOSSIL FUEL EXTRACTION AND EMISSIONS BY
ENTITIES WITH LEASES ON PUBLIC LAND, AND FOR OTHER PURPOSES,
``TRANSPARENCY IN ENERGY PRODUCTION ACT OF 2020''
----------
Tuesday, January 28, 2020
U.S. House of Representatives
Subcommittee on Energy and Mineral Resources
Committee on Natural Resources
Washington, DC
----------
The Subcommittee met, pursuant to notice, at 10:04 a.m., in
room 1334, Longworth House Office Building, Hon. Alan S.
Lowenthal [Chairman of the Subcommittee] presiding.
Present: Representatives Lowenthal, Levin, Cunningham;
Gosar, Westerman, and Hern.
Also present: Representative Lujan.
Dr. Lowenthal. The Subcommittee on Energy and Mineral
Resources will come to order.
Today, the Subcommittee is holding its first hearing of the
2020 year, and it is on H.R. 5636, Transparency in Energy
Production Act of 2020. This is legislation that I introduced
earlier this month.
Under Committee Rule 4(f), any oral opening statements are
limited to the Chair and the Ranking Minority Member or their
designee. I ask unanimous consent that all other Members'
opening statements be made part of the hearing record if they
are submitted to the Subcommittee Clerk by 5 p.m. today.
Hearing no objection, so ordered.
I am also asking for unanimous consent for Congressman Ben
Ray Lujan to sit on the dais and participate in this morning's
hearing.
Hearing no objection, so ordered.
STATEMENT OF THE HON. ALAN S. LOWENTHAL, A REPRESENTATIVE IN
CONGRESS FROM THE STATE OF CALIFORNIA
Dr. Lowenthal. First, I would like to welcome our witnesses
and particularly thank those of you who have traveled great
distances to be here with us today.
My bill, on its face, is simply about transparency. It is
about making sure that companies operating on America's public
lands tell the public the basic information about how they run
their operations.
But it is actually more than that. The bill is about
protecting public health, safeguarding the environment, and
trying to keep the devastating impacts of climate change in
check.
The oil and gas industry has, for years now, touted natural
gas as the solution to climate change. They point out, quite
rightly, that burning natural gas produces fewer carbon
emissions than burning coal. But they don't point out that
there is also a catch. Methane, the main component of natural
gas, is a powerful greenhouse gas, much worse for our climate
than carbon dioxide.
In fact, over a 20-year period, it is 86 times stronger or
more powerful than carbon dioxide at trapping heat. That means
that once a little bit of methane leaks, as little as 3
percent, you are no better off for the climate than going back
to coal.
And it is not just about the climate. Methane is the main
component of natural gas, but it is not the only component of
natural gas. When methane leaks from oil and gas production,
benzene leaks, hydrogen sulfide leaks, and other toxic volatile
organic chemicals also leak.
And the people who live near oil and gas sites breathe
these in, or they breathe in the ozone that these chemicals
help to create. They complain of nosebleeds, nausea, and more
serious health problems, and their children have to go to the
emergency room because of asthma attacks.
I saw and smelled some of this firsthand last year when I
visited and this Committee held a hearing in New Mexico. I went
to a well pad not far from Chaco Canyon on a beautiful, clear
spring day, and I saw some pipes and wellheads and storage
tanks, and nothing seemed out of the ordinary.
But then I looked through an infrared camera. Instead of a
beautiful landscape, I saw billowing clouds of gas pouring out
of all of this equipment. Methane, clear as day but invisible
to the naked eye, was leaking unchecked into the air.
Methane has no odor, but as I got closer, I could smell
some other chemicals that felt like they were making me sick. I
was able to get into our car and drive away. The people who
live there don't have that option of driving away as soon as
they smell it.
The oil and gas industry likes to say they have this issue
completely under control. It is just a few bad actors, or we
are exaggerating it, and don't worry, they are going to take
care of it. They have it under control.
The industry shows us data from the Environmental
Protection Agency saying that methane emissions are down 14
percent since 1990, even as natural gas production has more
than doubled. They don't like looking closer at the data,
though, because it shows that all of the reductions in methane
emission have come from better practices in transmission and in
distribution.
What we are talking about here today, the emissions of
methane from wells and equipment in the field, the EPA data
shows that when we just look at the emissions from the field,
these emissions have increased by over 30 percent since 1990.
Unfortunately, the EPA estimates are just that, an
estimate. We don't know exactly how much methane companies are
leaking, because there is no requirement for them to find out.
And even if these companies look into it, there is no
requirement to let the local communities nearby know what that
data is.
That is why we need the Transparency in Energy Production
Act, and it is not just about methane. It is about transparency
across the board.
In 1986, President Reagan signed the Emergency Planning and
Community Right-to-Know Act. The name of that law says it
clearly: communities have a right to know what is being
released into their own backyards.
And the evidence has shown that requiring public disclosure
helps drive down pollution. In the first 20 years after the law
was signed, pollution releases dropped 59 percent.
So, if the oil and gas industry and my friends on the
Republican side are going to oppose strong regulations to cut
down on methane emissions and claim that the data supports them
on that, I hope they will support getting better data and
giving it to the public.
[The prepared statement of Dr. Lowenthal follows:]
Prepared Statement of the Hon. Alan S. Lowenthal, Chair, Subcommittee
on Energy and Mineral Resources
First, I would like to welcome our witnesses and particularly thank
those of you who traveled great distances to be here today.
My bill, on its face, is simply about transparency. It's about
making sure that companies operating on America's public lands tell the
public basic information about how they run their operations.
But it's actually about much more than that. The bill is about
protecting public health, safeguarding the environment, and trying to
keep the devastating impacts of climate change in check.
The oil and gas industry has, for years now, touted natural gas as
the solution to climate change. They point out, quite rightly, that
burning natural gas produces fewer carbon emissions than burning coal.
But they don't point out that there's a catch. Methane, the main
component of natural gas, is a powerful greenhouse gas--much worse for
our climate than carbon dioxide.
In fact, over a 20-year period, it's 86 times stronger than carbon
dioxide at trapping heat. This means that once a little bit of methane
leaks--as little as 3 percent--you're no better off for the climate
than going back to coal.
And it's not just about the climate. Methane is the main component
of natural gas, but it's not the only component of natural gas. When
methane leaks, benzene leaks. Hydrogen sulfide leaks. Other toxic
volatile organic chemicals leak.
And the people who live near oil and gas sites breathe these in. Or
they breathe in the ozone that these chemicals help create. They
complain of nosebleeds, nausea, and more serious health problems, and
their children have to go to the emergency room because of asthma
attacks.
I saw, and smelled, some of this firsthand last year in New Mexico.
I went to a well pad not far from Chaco Canyon on a beautiful, clear
spring day--and I saw some pipes and wellheads and storage tanks, and
nothing seemed out of the ordinary.
But then I looked through an infrared camera, and instead of a
beautiful landscape, I saw billowing clouds of gas pouring out of all
of this equipment. Methane--clear as day but invisible to the naked
eye--was leaking unchecked into the air.
Methane has no odor, but as I got closer, I could smell some other
chemicals that felt like they were making me sick. I was able to get
back in the car and drive away. The people who live near there don't
have that option.
The oil and gas industry likes to say they have this under control.
It's just a few bad actors, or we're exaggerating, and don't worry,
they've got this.
The industry shows us data from the Environmental Protection Agency
saying that methane emissions are down 14 percent since 1990, even as
natural gas production has more than doubled. They don't like looking
closer at that data, though, because it shows that all of the
reductions in methane emissions have come from better practices in
transmission and distribution.
What we're talking about--the emissions of methane from wells and
equipment in the field--the EPA data shows those emissions have
increased by over 30 percent since 1990.
Unfortunately, even that EPA data is largely an estimate. We don't
know exactly how much methane companies are leaking, because there's no
requirement for them to find out. And even if these companies look into
it, there's no requirement to let nearby communities know.
That's why we need the Transparency in Energy Production Act, and
it's not just about methane. It's about transparency across the board.
In 1986, President Reagan signed the Emergency Planning and
Community Right-to-Know Act. The name of that law says it clearly:
communities have a right to know what is being released into their own
backyards.
And the evidence has shown that requiring public disclosure helps
drives down pollution. In the first 20 years after that law was signed,
pollution releases dropped 59 percent.
So, if the oil and gas industry and my friends on the Republican
side are going to oppose strong regulations to cut down directly on
methane emissions, and claim that the data supports them on that, then
I hope they'll support getting better data and giving it to the public.
______
Dr. Lowenthal. With that, I look forward to the testimony
of our witnesses, and I now recognize Ranking Member Gosar for
his opening statement.
STATEMENT OF THE HON. PAUL A. GOSAR, A REPRESENTATIVE IN
CONGRESS FROM THE STATE OF ARIZONA
Dr. Gosar. Thank you, Chairman.
Today, the Subcommittee will consider H.R. 5636, the
Transparency in Energy Production Act of 2020, sponsored by my
friend, Chairman Lowenthal.
This bill mandates that energy operators on Federal lands
and waters must submit numerous reports based on the so-called
sustainability accounting standards produced by the
Sustainability Accounting Standards Board, or SASB, if they
wish to bid on or operate a Federal lease.
While we can all agree that we should be promoting
transparency at all levels of government, especially concerning
the multiple use management of our Federal lands, this bill
misses the mark and instead places Federal transparency
requirements in the hands of a non-profit organization.
The SASB, which develops the rules for information that
companies would be forced to disclose under this bill, is a
non-governmental organization with no oversight from the
Administration nor Congress.
This is not to say that the experts employed by the Board
are not credible or well meaning, but they are unaccountable,
unelected, and have no official responsibility to the public.
Furthermore, it is hard to argue that this Board is
unbiased or apolitical as its top donors include 2020
presidential candidates Michael Bloomberg and Tom Steyer, both
of whom have been very transparent about their goals to end
conventional energy development on Federal lands. Bloomberg
even served as Chairman of the Board for several years and,
according to the SASB website, remains very involved in leading
the organization.
This bill requires companies to issue reports based on SASB
standards before bidding on a lease and issue additional
reports annually on any active Federal leases they hold. If
they fail to do so, the BLM can choose not to issue a lease or
halt all production on a lease with no warning.
Because the bill is unclear regarding how BLM must evaluate
these reports, the BLM could claim that a report is deficient
for any reason at all and shut down individual leases or even
the entire leasing program.
Further, if BLM decides to shut down operations because
they deem a producer's report is incomplete, the affected
entities may have valid takings claims against the Federal
Government.
Because this Board is unelected and unaccountable and this
bill would make their standards law, the Board could
theoretically make changes to their standards at any point,
forcing companies to issue new reports or risk BLM shuttering
their operations.
Further, there is no mechanism in the bill for the
Administration or Congress to amend the standards if the Board
makes an unwelcome and unworkable change, or to account for
implementation challenges.
The sustainability accounting standards imposed by this
bill include a multitude of disclosure topics and accounting
metrics which companies must cover in their reports. Operations
on Federal lands are already subject to numerous Federal
regulatory requirements under several statutes and are
accountable to multiple agencies before, during, and after
operations take place.
For example, the SASB requires companies to disclose
information regarding greenhouse gas emissions and air quality,
which operators must already report annually to the EPA.
The standards call for information about impacts on
biodiversity and Indigenous peoples, which are thoroughly
considered throughout the NEPA process.
The standards also ask for companies to report to BLM about
their labor practices, which are rightfully regulated through
the Department of Labor.
Any aspect of responsibility executing and producing on
Federal lease is accounted for and mandated through the Federal
regulatory process, which includes reporting requirements and
transparency. However, if this body determines that more
accountability and transparency are needed, then that authority
should remain with the relevant Federal agencies and with
Congress.
We should not be outsourcing our Federal regulatory
requirements to a liberal non-profit group that has not been
elected by the people or appointed by elected officials. I
highly doubt that any of my colleagues would want to do the
same for groups with ties to well-known conservative
organizations or conservative presidential candidates.
The mandate in this bill would not increase transparency or
provide additional benefits to the public but would undoubtedly
serve as fodder for lawsuits from anti-energy activists aimed
at stymying domestic energy progress.
The authority to regulate our natural resources should
remain with the Administration and with Congress, not with non-
profits by those who wish to end multiple use altogether.
With that, I yield back.
Dr. Lowenthal. Thank you, Ranking Member Gosar.
Now I am going to introduce today's witnesses. Our first
witness is Ms. Susan Mason, Managing Partner at Aligned
Partners and a Founding Member of the Business Coalition for
Conservation and Climate. Our second witness is Mr. Victor
Snover, the Mayor of Aztec, New Mexico, a former United States
Army officer and a current high school Junior ROTC instructor.
Our third witness is Mr. Kenneth Stein, the Policy Director for
the Institute for Energy Research. And our final witness is Dr.
Gretchen Goldman, the Research Director at the Center for
Science and Democracy at the Union of Concerned Scientists.
Let me remind the witnesses that they must limit their oral
testimony to 5 minutes, but that their entire testimony will
appear in the hearing record.
When you begin, the lights in front of you on the witness
table will turn green, but after 4 minutes, the yellow light
will come on. Your time will have expired when the red light
comes on, and I will ask you to please complete the statement
that you are making.
I will let you go on a little bit, but you know that you
have reached the end.
I am going to allow the entire panel to provide their
testimony before we have any questioning of witnesses.
The Chair now recognizes Ms. Mason to testify for 5
minutes.
Welcome to the Committee.
STATEMENT OF SUSAN MASON, MANAGING PARTNER, ALIGNED PARTNERS;
AND FOUNDING MEMBER, BUSINESS COALITION FOR CONSERVATION AND
CLIMATE, SAN FRANCISCO, CALIFORNIA
Ms. Mason. Good morning, Chairman Lowenthal, Ranking Member
Gosar, and members of the Subcommittee.
Thank you for inviting me to testify today regarding the
importance of public disclosure requirements for protecting
human health, the climate, and the environment. I sincerely
appreciate the opportunity to be here.
My name is Susan Mason, and I am a founder and managing
partner of Aligned Partners, a venture capital firm based in
Menlo Park, California. I am also a founding member of the
Business Coalition for Conservation and Climate, an
organization of leading business executives, investors, and
venture capitalists, who feel strongly that the transparency
and accountability within the oil and gas sector is critical to
addressing climate change in the United States.
For three decades, I have worked in the venture capital
space and founded my own fund in 2011. Throughout this time, I
have seen a remarkable transformation occur. After avoiding it
for years, investors of all political stripes have come to
realize that climate change is not only occurring but poses a
real and clear threat to our economy.
This transition is born out of absolute necessity. Studies
have estimated the value of capital assets at risk of climate
regulation or physical impacts could range from $4.2 trillion
to $4.3 trillion by 2100.
This realization has created a demonstrable shift in the
investment strategy of leading banks and the management
practices of some of the world's most notable polluters. We saw
a tangible example of this tectonic shift earlier this morning
when Larry Fink, Chief Executive Officer of BlackRock, the
world's largest asset manager with over $7 trillion under
management, informed the firm's clients that it would be
altering its energy investment strategy to account for the risk
posed by climate change.
Not only would it be divesting from thermal coal
altogether, the company would be applying newer, more rigorous
screening for investments within the energy sector. In applying
these new measures, Fink said that investors, along with
regulators, insurers, and the public needed a clearer picture
of how companies are managing sustainability-related questions.
I could not agree more because a company's long-term
prospects for success are completely dependent on its ability
to sustain itself.
BlackRock's example is one of countless I am seeing in the
investment space. Leading oil and gas companies like BP and
Exxon have all been required to modify their climate impacts
because shareholders demanded action.
In the most stark action to date, beginning this year,
compensation for executives at Royal Dutch Shell will partially
be tied to the company achieving short-term carbon emission
targets.
I am often asked why these changes are occurring, and the
reason is that as access to information has improved, the
investors in these companies have demanded that the companies
in which they are invested in operate in their long-term best
interest.
While this shift is critically important for the long-term
sustainability of our planet and the economy, it has not had a
similar impact on the way our Federal lands are managed, which
remains unchanged.
The reason, I surmise, in part, is because the American
people don't have the same level of access to information about
the types of energy being developed on public lands and what
the climate impact is of that development.
As owners and caretakers of our Nation's resources, we
should all strive for greater transparency and accountability
from our Federal Government, particularly when it comes to our
most cherished national resources, our public parks and
monuments.
Fortunately, legislation has recently been introduced by
several members of this panel that would take important steps
toward bringing greater transparency related to energy
developed on public lands.
The aptly named Transparency in Energy Production Act, or
TEPA, would impose common-sense measurement standards on oil
and gas companies holding or seeking a lease to acquire energy
on public lands.
I used the term ``common-sense'' because the bill uses a
brilliantly eloquent solution, adopting the industry developed
standards created by the Sustainability Accounting Standards
Board, or SASB.
SASB was created in 2011 by some of the Nation's largest
banks and institutional investors to create a streamlined and
administratively easy set of measures companies could use to
report to their investors on sustainability risks and
opportunity.
Today, over 120 publicly traded companies use SASB to
report to their investors and the public. This list includes
oil and gas companies, like Apache, Baytex, GS Caltex,
Halliburton, and others.
TEPA does not mandate a change in the types of energy
developed, but rather gives the American people the data they
need to make informed decisions and compel them to manage these
areas in the national interest. Just as publicly traded
companies are required to share critical information with their
shareholders, as owners of these lands the American people are
entitled to that information. And as the private sector is
already demonstrating, money can be made without degrading our
health and environment.
I want to thank this Committee for holding today's hearing
on the vital role transparency should play in the management of
public lands and urge support for H.R. 5636.
Thank you.
[The prepared statement of Ms. Mason follows:]
Prepared Statement of Susan Mason, Managing Partner of Aligned Partners
and Founding Member of the Business Coalition for Conservation and
Climate
Chairman Lowenthal, Ranking Member Gosar, and members of the
Subcommittee, thank you for inviting me to testify today regarding
``The Importance of Public Disclosure Requirements for Protecting Human
Health, the Climate, and the Environment.'' I sincerely appreciate the
opportunity to be here.
My name is Susan Mason, I am a founder and Managing Partner of
Aligned Partners, a venture capital firm based in Menlo Park,
California. I am also a founding member of the Business Coalition for
Conservation and Climate, an organization of leading business
executives, investors, and venture capitalists who feel strongly that
the transparency and accountability within the oil and gas sector is
critical to addressing climate change in the United States.
For three decades, I have worked in the venture capital space and
founded my own fund in 2011. Throughout this time, I have seen a
remarkable transformation occur. After avoiding it for years, investors
of all political stripes have come to realize that climate change is
not only occurring, but poses a real and clear threat to our economy.
The transition is born out of absolutely necessity. Studies have
estimated the value of capital assets at risk of climate regulation or
physical impacts could range from $4.2 trillion to $4.3 trillion by
2100. This realization has created a demonstrable shift in the
investment strategy of leading banks, and the management practices of
some of the world's most notable polluters.
We saw a tangible example of this tectonic shift earlier this month
when Larry Fink, Chief Executive Officer of BlackRock, the world's
largest asset manager with over $7 trillion under management, informed
the firm's clients that it would be altering its energy investment
strategy to account for the risk posed by climate change. Not only
would it be divesting from thermal coal altogether, the company would
be applying newer, more rigorous screening for investments within the
energy sector.
In applying these new measures, Fink said that investors, along
with regulators, insurers, and the public, need a clearer picture of
how companies are managing sustainability-related questions. I could
not agree more because a company's long-term prospects for success are
completely dependent on its ability to sustain itself.
BlackRock's example is one of countless I am seeing in the
investment space. Leading oil and gas companies like BP and Exxon have
all been required to modify their climate impacts, because shareholders
demanded action. In the most stark action to date, beginning this year,
compensation for executives and Royal Dutch Shell will partially be
tied to the company reaching short-term carbon emissions targets.
I am often asked why these changes are occurring and the reason is
that as access to information has improved, the investors in these
companies have demanded that the companies in which they are invested
are operating in their long-term best interests.
While this shift is critically important for the long-term
sustainability of our planet and the economy, it has not had a similar
impact on the way our Federal lands are managed which remain unchanged.
The reason I surmise, in part, is because the American people don't
have the same level of access to information about the types of energy
being developed on public lands, and what the climate impact is of that
development.
As owners and caretakers of our Nation's resources, we should all
strive for greater transparency and accountability from our Federal
Government, particularly when it comes to our most cherished natural
resource, our public parks and monuments. Fortunately, legislation was
recently introduced by several members of this panel that would take
important steps toward bringing greater transparency related to energy
developed on public lands.
The aptly named Transparency in Energy Production Act, or TEPA,
would impose common-sense measurement standards on oil and gas
companies holding or seeking a lease to acquire energy on public lands.
I use the term common-sense, because the bill uses a brilliantly
eloquent solution, adopting the industry developed standards created by
the Sustainability Accounting Standards Board, or SASB. SASB was
created in 2011 by some of the Nation's largest banks and institutional
investors to create a streamlined, and administratively easy, set of
measures companies could use to report to their investors on
sustainability risk and opportunity.
Today, over 120 publicly traded companies use SASB standards to
report to their investors, and the public. This list includes oil and
gas companies like Apache, Baytex, GS Caltex, Halliburton, Hess, Kinder
Morgan, NRG, Southern Company, Southwestern Energy and TC Energy.
TEPA does not mandate a change in the types of energy developed,
but rather gives the American people the data they need to make
informed decisions and compel to manage these areas in the national
interest. Just as publicly traded companies are required to share
critical information with their shareholders, as owners of these lands,
the American people are entitled to that information, and as the
private sector is already demonstrating, money can be made without
degrading our health and environment. I want to thank this Committee
for holding today's hearing on the vital role transparency should play
in the management of public lands and urge support for H.R. 5636.
______
Dr. Lowenthal. Thank you, Ms. Mason.
Now I turn to Mr. Snover for your testimony. Welcome.
STATEMENT OF VICTOR SNOVER, MAYOR, AZTEC, NEW MEXICO
Mr. Snover. Good morning, Chairman Lowenthal, Ranking
Member Gosar, and members of the Subcommittee. Thank you for
inviting me to testify today in support of H.R. 5636. I
sincerely appreciate the opportunity to be here.
My name is Victor Snover, and I am the elected City
Commissioner and Mayor of Aztec, New Mexico. I am also a
current high school Junior ROTC instructor and former U.S. Army
noncommissioned officer.
I come before you today advocating for the people of Aztec,
New Mexico, many of whom are disproportionately impacted by
fossil fuel emissions leading to short- and long-term impacts
on their health, community, and livelihoods.
The legislation before us today would help communities like
mine make informed decisions regarding the impacts of harmful
oil and gas emissions ranging from how we spend our small local
budgets, from health care to infrastructure, education and
mitigation from local oil and gas pollution, to simply if our
kids should spend time outside on a particular day due to high
rates of pollutants in the air.
In my day job as a public high school teacher at Aztec High
School, anecdotally, I would estimate approximately half of my
students suffer from some sort of respiratory issue.
I also recognize that there can be other mitigating factors
for this, but I believe that we should be doing everything and
anything within our power as elected officials and policy
makers to reduce as many of those mitigating factors as we
possibly can.
Maximizing profits should never be a factor when it comes
to public health and safety. At a minimum, our communities
should know what kinds of emissions are being pumped into our
atmosphere from the oil and gas industry.
In 2014, NASA discovered what has often been described as
the Delaware size methane cloud in the upper atmosphere above
the Four Corners region of the United States. My community of
Aztec is in the very heart of this region nestled in the far
northwest corner of the beautiful state of New Mexico.
Covering approximately 2,500 square miles of our region,
the Four Corners methane hot spot is the most concentrated area
of methane pollution in the entire United States. That bears
repeating--the entire United States.
This problem affects tens of thousands of people in the
region living in communities like Farmington, New Mexico just
up the road from me; Bloomfield; and my home of Aztec, New
Mexico, along with many other towns around us.
This methane cloud did not just suddenly appear. It is the
result of years of companies polluting our air without
detailing the full extent of their projects' impacts. H.R. 5636
would begin to remedy this problem.
Colorado has become a model for us to emulate. In 2014,
they placed limits on methane emissions, and even still their
oil and gas industry is still going strong. Proof of the
concept that reducing waste in emissions does not harm the
industry, but it can help the health, well-being, and quality
of life of the people living in and around extraction sites
while still creating jobs.
The states are leading the way, but we need alignment with
the Federal Government.
In New Mexico, under current regulations and rules, there
is an annual loss of $275 million in energy resources and an
additional $43 million in state tax and royalty revenue that we
could and that we should be investing in our school systems.
In a state where our education system consistently ranks in
the lower tier nationally, any opportunity to increase revenue
for educational programs should be explored.
New Mexico's methane emissions are said to have the same
short-term impacts on our climate as 22 coal-fired power plants
or 28 million internal combustion engine automobiles.
Beyond resource and revenue losses, the unnecessary leaks
of methane are allowing other harmful forms of pollution to
escape that lead to ozone smog. The state's air quality data
shows that San Juan County, which is the county in which Aztec
is located, is at risk of violating Federal ozone standards.
We should not be willing to accept outcomes that put
industry profit over the general health and clean air standards
that we need to live productive lives. In areas with diminished
air quality, it is often the youngest and the oldest amongst us
that suffer disproportionately more.
It is the poorest of us that suffer most because they do
not possess the resources to move further away from well sites
or to seek the needed medical treatment to help with their
respiratory issues, like emphysema and asthma.
Thankfully, the state of New Mexico is now turning the
corner to be on the leading edge of working to reduce emissions
and understand the actual level of emissions that are resulting
from oil and gas. But, unfortunately, the Federal Government,
mainly the Bureau of Land Management, or BLM, is failing to do
so, thus taking us backward and risking our public health and
livelihood in the process.
The legislation before us today is a good first step at
addressing these environmental injustices and the climate
crisis, and helping state and local leaders make informed
decisions about their communities' energy needs.
With greater information, we have a more informed citizenry
who can make better decisions about their future. As Thomas
Jefferson once said, ``An educated citizenry is a vital
requisite for our survival as a free people.'' I believe that
holds true today.
I look forward to answering any questions you may have
today, and thank you again.
[The prepared statement of Mr. Snover follows:]
Prepared Statement of Victor Snover, Mayor, Aztec, New Mexico and
former U.S. Army Officer
introduction
Chairman Lowenthal, Ranking Member Gosar, and members of the
Subcommittee, thank you for inviting me to testify today regarding
``The Importance of Public Disclosure Requirements for Protecting Human
Health, the Climate, and the Environment.'' I sincerely appreciate the
opportunity to be here.
My name is Victor Snover, and I'm the Mayor of Aztec, New Mexico.
I'm also a current high school Army JROTC instructor, and after 22
years of service, a retired United States Army Non-Commissioned
Officer. I come before you today to advocate for the hardworking people
of Aztec, New Mexico, many of whom are disproportionately impacted by
fossil fuel emissions leading to short- and long-term impacts on their
health, community and livelihoods. The legislation before us today
would help communities like mine make informed decisions regarding the
impacts of harmful oil and gas emissions. Ranging from how we spend our
small local budget--from health care to infrastructure, education and
mitigation from local oil and gas pollution--to if our kids should
spend time outside on a particular day due to the high rates of
pollutants in the air.
background
I am an elected City Commissioner, the Mayor of Aztec, but my day
job is as a public high school teacher at Aztec High School.
Anecdotally, I would estimate approximately half of my students suffer
from some form of respiratory issues. I recognize that there can be
other mitigating factors for this, but I also believe that we should be
doing everything within our power, as elected officials and policy
makers, to reduce as many of those contributing factors as we possibly
can. That means having the courage to hold those contributors to these
issues, like the oil and gas industry, accountable. Maximizing profits
should never be a factor when it comes to public health and safety. At
minimum, our community should know what kinds of emissions are being
pumped into our atmosphere from the oil and gas industry.
In 2014, NASA discovered what has often been described as a
``Delaware sized methane cloud'' in the upper atmosphere above the Four
Corners region of the United States.\1\ My community of Aztec is in the
heart of this region nestled in the far northwest corner of the
beautiful state of New Mexico.
---------------------------------------------------------------------------
\1\ https://science.nasa.gov/science-news/science-at-nasa/2014/
09oct_methanehotspot/.
---------------------------------------------------------------------------
Covering approximately 2,500 sq/mi. of our region, the Four Corners
methane hot spot is the most concentrated area of methane pollution in
the entire United States.\2\ This problem affects tens of thousands of
people in this region living in communities like Farmington, Bloomfield
and my home of Aztec along with many other towns in New Mexico. This
methane cloud did not just suddenly appear, it's the result of years of
companies polluting our air without detailing the full extent of their
project's impacts. H.R. 5636, the Transparency in Energy Production Act
of 2020 would begin to remedy this problem.
---------------------------------------------------------------------------
\2\ https://science.nasa.gov/science-news/science-at-nasa/2014/
09oct_methanehotspot/.
---------------------------------------------------------------------------
Take Colorado, which has become a model for us to emulate. In 2014,
they placed limits on methane emissions, and their oil and gas industry
is still going strong. Their example provides proof of the concept that
reducing waste and emissions does not harm the industry, but more
importantly that it can help the health, well-being, and quality of
life of the people living in and around extraction sites, while still
creating jobs. Many states are leading the way, but we need alignment
with the Federal Government.
In New Mexico, under current regulations and rules, there is an
annual loss of $275 million in energy resources and an additional $43
million in state tax and royalty revenue that we could and that we
should be investing in our school systems.\3\ In a state where our
education system consistently ranks in the lower tier nationally, any
opportunity to increase revenue for educational programs should be
explored.
---------------------------------------------------------------------------
\3\ http://blogs.edf.org/energyexchange/files/2019/09/Synapse-
Methane-Cost-Benefit-Report.pdf.
---------------------------------------------------------------------------
New Mexico's methane emissions are said to have the same short-term
impacts on our climate as 22 coal-fired power plants or 28 million
internal combustion automobiles.\4\
---------------------------------------------------------------------------
\4\ http://blogs.edf.org/energyexchange/files/2019/09/Synapse-
Methane-Cost-Benefit-Report.pdf.
---------------------------------------------------------------------------
Beyond resource and revenue losses, the unnecessary leaks of
methane are allowing other harmful forms of pollution to escape that
lead to ozone smog. The state's air quality data shows that San Juan
County, which is the county in which Aztec is located, is at risk of
violating Federal ozone standards.\5\ We should not be willing to
accept outcomes that put industry profit over the general health and
clean air standards that we need to live healthy and productive lives.
In areas with diminished air quality, it is often the youngest and the
oldest among us that suffer disproportionately and it's the poorest of
us that suffer most because they don't possess the resources to move
further away from well sites and/or seek the needed medical treatment
to help with their respiratory issues like emphysema and asthma.
---------------------------------------------------------------------------
\5\ https://www.sanjuancitizens.org/oil-and-gas/new-epa-ozone-
standard-does-not-go-far-enough.
---------------------------------------------------------------------------
Thankfully the state of New Mexico is now turning the corner to be
on the leading edge of working to understand and reduce emissions
resulting from oil and gas. But unfortunately, the Federal Government--
mainly the Bureau of Land Management (BLM)--is failing to do so, thus
taking us backward, and risking our public health and livelihood in the
process.
The legislation before us today is a good first step at addressing
these environmental injustices and the climate crisis. It will empower
state and local leaders to make informed decisions about their
communities' energy needs. With greater information, we will have a
more informed citizenry, who can make better decisions about their
futures. As Thomas Jefferson once said, ``an educated citizenry is a
vital requisite for our survival as a free people.'' \6\ I believe that
holds true here today, perhaps. more than ever.
---------------------------------------------------------------------------
\6\ Wagoner, Jennings. Jefferson and Education. Charlottesville,
VA.: Thomas Jefferson Foundation, 2004.
---------------------------------------------------------------------------
emissions from u.s. public lands
Our Federal lands play an important role in climate change and
should also play a role in the solutions. The U.S. Government is one of
the largest energy asset managers in the world, and yet it has done
little to inform its shareholders--American taxpayers--about the
Federal energy program and its associated climate related risks.
Where there is fossil fuel production there are emissions.
Emissions associated with oil, gas and coal production from Federal
lands are equivalent to more than 20 percent of total U.S. greenhouse
gas emissions. For comparison, if Federal lands were a country, it
would rank 5th in the world in total emissions behind China, India, the
United States and Russia.\7\
---------------------------------------------------------------------------
\7\ https://www.wilderness.org/articles/article/federal-lands-
emissions-accountability-tool.
---------------------------------------------------------------------------
Until recently, the Federal Government was not tracking emissions
from fossil fuel production on Federal lands, and is still not
developing a plan to reduce them. The government does not have one,
centralized publicly accessible database for all data related to
Federal oil, natural gas and coal. The data that is available, while
useful, is incomplete. Further, there are no sources available that
provide a comprehensive accounting of greenhouse emissions from Federal
lands.
America's public lands belong to the American people and they, as a
result, have a right to know how much energy is being developed and the
associated climate risks. Just as shareholders of publicly traded
companies receive key information regarding financial risk to their
portfolios, taxpayers deserve to know how their energy assets are being
managed and have a say in the direction of the Federal energy program
moving forward.
We have a solution to fight climate change. It's our public lands.
While current management of our Nation's public lands makes them a
significant contributor to the U.S. climate change problem, they have
the potential to play an even bigger role in climate solutions.
requests
To make our Nation's public lands part of the climate solution
instead of the problem, the Federal Government should immediately
reduce fossil fuel emissions from public lands. We must reduce
emissions tied to energy development on public lands and waters at or
ahead of the pace dictated by climate science. Emissions from coal, oil
and gas produced on public lands and waters make up more than 20
percent of the United States' total greenhouse gas emissions. As such,
policy makers must establish an ambitious goal of net zero emissions
from public lands and waters by 2030.
While driving down fossil fuel emissions, we must simultaneously
unlock the potential of the United States' public lands and waters to
help achieve a clean energy future. Some of our Nation's best solar,
wind and geothermal resources are found on public lands. Carefully
choosing the best sites and expanding renewable energy development on
public lands can help boost local economies, provide new job
opportunities across a range of skill levels, and generate additional
revenue streams for state and local governments.
As the U.S. Federal Government is one of the largest energy asset
managers in the world, and yet still does not sufficiently track or
make available the data associated with the production and emissions
from fossil fuels developed on Federal lands and waters, we need a
better way. H.R. 5636--the Transparency in Energy Production Act of
2019 (TEPA) takes a first step by directing companies seeking or
holding a lease to drill on public lands to track and report the amount
of energy production and resulting emissions from Federal lands and
waters, and more specifically, the following:
1. Uses standards established by nationally recognized
Sustainability Accounting Standards Board (SASB) to report
the amount, type, and source of fossil fuels produced under
Federal leases, including the methane gas released by
venting, naring, and fugitive release on Federal lands.
2. Reports the amount of energy produced by renewable energy
projects on Federal lands.
3. Makes information publicly available through database created and
maintained by the Department of the Interior.
By beginning to implement policies that reduce our dependence on
fossil fuels, curb emissions, promote renewable energy all under a
transparent process then we can transition our economy into a clean
energy future where no one gets left behind because we have all the
necessary information up front. Our public lands are a great first
place to start.
______
Dr. Lowenthal. Thank you, Mr. Snover.
The Chair now recognizes Mr. Stein for your testimony.
Welcome.
STATEMENT OF KENNETH STEIN, POLICY DIRECTOR, INSTITUTE FOR
ENERGY RESEARCH, WASHINGTON, DC
Mr. Stein. Mr. Chairman, Mr. Ranking Member, thank you for
the opportunity to participate in this Subcommittee hearing.
My name is Kenny Stein, and I am the Policy Director for
the Institute of Energy Research. We are a free market think
tank covering energy and environment policy here in DC.
The legislation under discussion at this hearing suffers
from a number of infirmities. It disregards basic structures of
administrative law and, indeed, constitutional law. It
duplicates existing regulations and disclosure requirements,
and in practice, it would merely serve to increase the costs
and barriers to energy development on Federal lands.
I will begin with the most egregious of this bill's
deficiencies, which is the outsourcing of Federal regulatory
power to a non-government entity with a clear ideological
agenda.
Section 2 of the legislation cites disclosure standards
created by the SASB, as discussed, and proposes to mandate that
entities seeking or holding leases on Federal land file reports
which comply with the SASB standards in effect at the date of
the filing of that report.
Thus, if and when the SASB makes changes to its standards,
the disclosure requirements for Federal leaseholders and
seekers will automatically change by action of law. This means
that the SASB would have the regulatory power to set disclosure
standards for Federal leasing.
The SASB is not a government agency. Its board is not
appointed by the President or confirmed by the Senate. It is
entirely independent of the Federal Government.
Put simply, this is an unconstitutional delegation of
Federal regulatory power. While the Supreme Court historically
has been very lenient about delegations of congressional
authority to executive branch agencies, it has been unequivocal
that delegation of legislative powers to private entities is
unconstitutional.
The delegation of the regulatory power to set disclosure
standards to the SASB cannot pass constitutional muster.
The reasoning for this blanket constitutional bar is made
obvious by the situation we see before us. The SASB is an
explicitly ideological organization. It seeks to promote
adoption of its views of what constitutes sustainability.
It was founded and funded by organizations like the
Rockefeller Foundation and Bloomberg philanthropies and, as
previously discussed, Michael Bloomberg is a former chairman of
the organization, and he remains chairman emeritus today, even
as he runs for President on a platform of halting fossil fuel
development on Federal lands.
The legislation would give this ideological organization
the unchecked power to set regulatory standards for Federal
leasing.
The conflict here is obvious. Handing regulatory authority
to the SASB as proposed in this bill is analogous to a
conservative Member of Congress proposing a bill to hand over
some aspect of Federal regulatory authority to the Heritage
Foundation.
Both the title of this legislation and the press release
and discussion from its sponsors imply that there is a lack of
transparency about the current leasing process on Federal
lands, but this is very misleading.
The disclosures contemplated in the SASB guidelines are in
many instances duplicates of information that leaseholders
already report to Federal agencies, while other parts of the
guidelines are completely irrelevant to the operation of a
Federal lease.
For example, leaseholders already report emissions to the
EPA, including for greenhouse gases. However, unlike existing
reporting requirements, the SASB doesn't actually include any
metrics for how compliance with their reports can be assessed.
Likewise, the SASB standards include disclosures about
biodiversity impacts, but Federal leases are already subject to
the NEPA process.
For additional SASB sections like business ethics,
community relations, and security and human rights, besides
those being vague concepts, it is not clear what bearing those
subjects have on a company's competency to manage a lease on
Federal lands.
So, rather than a genuine bid for transparency, this
legislation is more accurately described as an effort to impose
higher costs on energy leasing on Federal land. The vagueness
of many of the SASB guidelines serves a dual purpose in this
raising of cost.
On the front end, the company has to come up with new
accounting and compliance processes in order to collect and
produce the information demanded, and then on the back end, the
vagueness opens up new avenues for litigation from anti-
development organizations over judgment call calculations or
assertions that one of the extraneous disclosure categories has
not been completed satisfactorily.
Use of the SASB guidelines is also a backdoor effort to
achieve regulatory goals under the guise of transparency that
otherwise could not pass Congress.
For example, one of the primary criticisms of the Obama
administration's proposed methane regulations was the steep
cost of new monitoring equipment needed to comply with the
rules.
Requiring the SASB disclosures would impose those same
monitoring costs, though this time not even with the
justification of trying to reduce methane emissions.
As drafted, the legislation is poorly constructed. It is
expensive, duplicative, and frankly, unconstitutional.
Mandating the SASB standards looks suspiciously like using
Federal power to coerce participation in a private NGO's pet
project.
If Congress wishes to create standards for sustainability
for Federal leasing or for any other Federal contracting, the
appropriate process is to try to mandate to relevant Federal
agencies to develop standards through the administrative
process.
In addition to having the advantage of being
constitutional, such a process has long-standing administrative
procedure and legal principles that ensure the rights of the
companies and individuals impacted by the standards are
protected.
Thank you for this opportunity. I look forward to your
questions.
[The prepared statement of Kenneth Stein follows:]
Prepared Statement of Kenneth Stein, Policy Director, Institute for
Energy Research
Mr. Chairman, thank you for the opportunity to participate in this
Subcommittee hearing.
My name is Kenny Stein, I am the Policy Director for the Institute
for Energy Research, a free-market organization that conducts research
and analysis on the function, operation, and regulation of energy
markets.
The legislation (H.R. 5636) under discussion at this hearing
suffers from a number of infirmities. It disregards basic standards of
administrative law, and indeed constitutional law, it duplicates
existing regulations and disclosure requirements, and in practice it
would merely serve to increase the costs and barriers to energy
development on Federal lands.
unconstitutional
I will begin with the most egregious of this bill's deficiencies:
the outsourcing of Federal regulatory power to a non-governmental
entity with a clear ideological agenda. Section 2 of the legislation
cites disclosure standards created by the Sustainability Accounting
Standards Board (SASB) and proposes to mandate that entities seeking or
holding leases on Federal lands file reports which comply with the SASB
standards in effect ``at the date'' of the filing. Thus, if and when
the SASB makes changes to its disclosure standards, the disclosure
requirements for Federal leaseholders and seekers will also change
automatically by action of law. This means that the SASB would have the
regulatory power to set disclosure standards for Federal leasing. The
SASB is not a government agency. Its board is not appointed by the
President or confirmed by the Senate. It is entirely independent of the
Federal Government.
Put simply this is an unconstitutional delegation of Federal
regulatory power. While the Supreme Court has historically been very
lenient about delegations of congressional authority to executive
branch agencies, it has been unequivocal that delegation of legislative
powers to private entities is unconstitutional. The delegation of the
regulatory power to set disclosure standards to the SASB cannot pass
constitutional muster.
The reasoning for this blanket constitutional bar is made obvious
by the situation we see before us. The SASB is an explicitly
ideological organization. It seeks to promote adoption of its views of
what constitutes ``sustainability.'' It was founded and is funded by
foundations like the Rockefeller Foundation and Bloomberg
Philanthropies, which are ideologically hostile to conventional energy
development. Michael Bloomberg was the chairman of the organization
from 2014-2018, and remains a chairman emeritus today even as he runs
for President on a platform of halting fossil fuel development on
Federal lands. The legislation would give this ideological organization
the unchecked power to set regulatory standards for Federal leasing.
The conflict here is obvious. Handing regulatory authority to the SASB
as proposed in this bill is analogous to a conservative Member of
Congress proposing a bill to hand over some aspect of Federal
regulatory authority to the Heritage Foundation.
duplication not transparency
Both the title of this legislation and the press release from its
sponsors imply that there is a lack of transparency in the current
leasing process on Federal lands, but this is misleading. The
disclosures contemplated in the SASB guidelines are in many instances
duplicates of information that leaseholders already report to relevant
Federal agencies, while other parts of the guidelines are completely
irrelevant to the operation of a Federal lease.
For example, leaseholders already report emissions to the EPA,
including for greenhouse gases. Unlike existing reporting requirements,
though, the SASB does not have any metrics by which compliance can be
assessed. Likewise the SASB standards include disclosures about
biodiversity impacts, but Federal leases are already subject to the
National Environmental Policy Act process. For additional SASB sections
like business ethics, community relations, and security and human
rights, besides being vague concepts, it is not clear what bearing
those subjects have on a company's competency to manage a lease on
Federal lands.
Additionally, the global nature of these disclosures is of
questionable necessity. The SASB guidelines are designed for investors
interested in sustainability to evaluate a company holistically on its
global operations. The question is what relevance these extraneous
disclosures have on the operation of a Federal lease. To take one
disclosure category from the SASB guidelines, what does the
``percentage of proved and probable reserves in or near areas of
conflict'' have to do with seeking a lease in Utah?
imposing unnecessary costs
Rather than a genuine bid for transparency, this legislation is
more accurately described as an effort to impose higher costs on energy
leasing on Federal lands.
The vagueness of many of the SASB guidelines serves a dual purpose
in raising costs. On the front end, a company has to come up with new
accounting and compliance processes in order to collect and produce the
information demanded. On the back end, the vagueness opens up new
avenues for litigation from anti-development organizations over
judgment call calculations or assertions that one of the extraneous
disclosure categories is not completed satisfactorily.
Use of the SASB guidelines is also a backdoor effort to achieve
regulatory goals under the guise of transparency that otherwise could
not pass Congress. For example, one of the primary criticisms of the
Obama administration's proposed methane regulations was the steep cost
of new monitoring equipment to comply with the rules. Requiring SASB
disclosures could impose those very same monitoring costs, though this
time not even with a justification of trying to reduce methane
emissions.
conclusion
As drafted, the legislation is very poorly constructed: expensive,
duplicative and frankly unconstitutional. Mandating the SASB standards
looks suspiciously like using Federal power to coerce participation in
a private NGO's pet project. If Congress wishes to create standards for
sustainability, for Federal leasing or any other Federal contracting,
the appropriate process is to provide a mandate to the relevant Federal
agencies to develop standards through the administrative process. In
addition to having the advantage of being constitutional, such a
process has long-standing administrative procedure and legal principles
that ensure that the rights of companies and individuals impacted by
the standards are protected. The approach taken by this legislation
should be rejected.
Thank you for this opportunity and look forward to your questions.
______
Dr. Lowenthal. Thank you, Mr. Stein.
The Committee now recognizes Dr. Goldman for your
testimony. Welcome to the Committee, Dr. Goldman.
STATEMENT OF DR. GRETCHEN GOLDMAN, RESEARCH DIRECTOR, CENTER
FOR SCIENCE AND DEMOCRACY, UNION OF CONCERNED SCIENTISTS,
WASHINGTON, DC
Dr. Goldman. Thank you, Chairman Lowenthal and Ranking
Member Gosar, for the opportunity to testify at this important
hearing.
My name is Dr. Gretchen Goldman, and I serve as the
Research Director in the Center for Science and Democracy at
the Union of Concerned Scientists.
For nearly a decade, I have been working on corporate
engagement on climate science and policy, community right to
know, and public access to scientific information.
Communities around the country have long been affected by
the activities of the fossil energy industry. These communities
endure environmental hazards and health impacts without even
knowing what is in the air they breathe or the water they
drink.
This is the reason regulatory safeguards and disclosure
requirements exist, to protect people. Energy companies have an
obligation to disclose the social and environmental impacts of
their operations. These are common-sense expectations.
Yet, current disclosure by the fossil energy industry is
woefully inadequate. Companies continue to operate on public
lands close to residential areas and with minimal oversight.
This lack of disclosure leaves decision makers, investors, and
communities in the dark, costing taxpayers and threatening
public health and safety.
This is why we need legislation like the Transparency in
Energy Production Act of 2020. H.R. 5636 would help ensure
access to vital information that can protect the public and
promote responsible corporate governance.
A record of bad behavior demonstrates that the fossil
energy industry needs our oversight, not our trust. Fossil
energy companies have consistently failed to report sufficient
details on their social and environmental impacts. This is
despite requirements by the U.S. Securities and Exchange
Commission and despite investor and public pressure.
If companies are not honest about what is happening in
their backyards, how can we trust them to be honest about what
is happening in ours?
Companies' social license to operate is contingent upon
their being a transparent and responsible actor. Unfortunately,
from refusals to share basic information with decision makers
and medical personnel, to preventable explosions that have
evacuated entire communities, to illegal dumping and unsafe
practices, fossil energy companies have lost the public trust.
This is not just about disclosure. It is about the rights
of communities to know about public health threats and to have
the information they need to protect themselves. When this
information is concealed, people are unable to make informed
decisions about their daily lives.
Should my child play in our yard? Is our water safe to
drink? Is it safe to breathe the air?
The answers to these simple questions can mean the
difference between an uneventful day and another trip to the
emergency room.
Increasingly and disproportionately, it is low income
communities, communities of color and Indigenous communities,
living, working, and going to school near energy production
sites. It is these communities that must ask these simple
questions and face companies' insufficient answers.
Continued lack of disclosure by the fossil energy industry
has meant communities have had to advocate for themselves,
negotiating with companies, conducting community science, and
fighting in the courts, all to access information that should
be public.
The disclosures outlined in H.R. 5636 are feasible and long
overdue. Fossil energy companies routinely collect data on well
sites, chemicals, wastewater, and other environmental
monitoring. It is reasonable and necessary that these data be
shared in an open, timely, and accessible way.
The Sustainability Accounting Standards Board disclosures
requested in the bill were produced working closely with the
extractives industry and align with the disclosures that public
companies must make annually to the U.S. Securities and
Exchange Commission anyway.
When energy companies fail to disclose their human and
environmental footprints, it is others who will pay the price.
The public pays in tax dollars when first responders,
healthcare workers, local governments, and Federal aid services
must respond to the disasters at fossil energy facilities. And
nearby communities pay every day when they are exposed to harm
from routine emissions, leaks, and other damages made worse by
poor disclosure and management.
Companies owe it to all of us to be responsible actors. The
Transparency in Energy Production Act will help keep families
informed, corporations held accountable, and the public safe.
This is a future worth striving for.
Thank you.
[The prepared statement of Dr. Goldman follows:]
Prepared Statement of Dr. Gretchen T. Goldman, Research Director,
Center for Science and Democracy, Union of Concerned Scientists
Thank you, Chairman Lowenthal and Ranking Member Gosar, for the
opportunity to testify at this important hearing. My name is Gretchen
Goldman, and I serve as the Research Director in the Center for Science
and Democracy at the Union of Concerned Scientists. For nearly a
decade, I have been working on corporate engagement on climate science
and policy, community right to know, and public access to scientific
information.
Communities around the country have long been affected by the
activities of fossil energy companies, enduring environmental hazards
and health impacts without knowing precisely what is in the air they
breathe or the water they drink. This is the reason regulatory
safeguards and disclosure requirements exist: To protect people. Energy
companies have an obligation to disclose the social and environmental
impacts of their operations. These are common-sense expectations, but
current disclosure by the fossil energy industry is woefully
inadequate. Companies continue to operate on public lands, close to
residential areas, with minimal oversight. This leaves decision makers,
investors, and communities in the dark, costing taxpayers and
threatening public health and safety. This is why we need legislation
like the ``Transparency in Energy Production Act of 2020.'' H.R. 5636
would ensure access to the vital information that can protect the
public and promote responsible corporate governance.
voluntary disclosure is insufficient
A record of bad behavior demonstrates that the fossil energy
industry needs our oversight, not our trust. Historically, many
companies in carbon-intensive industries have opted out of voluntary
Environmental, Social, and Governance (ESG) reporting and commitment
initiatives, and there is little reason to believe this would change
with new voluntary initiatives.\1\ Even initiatives created with
industry input, such as the Task Force for Climate-related Financial
Disclosures, or backed by investors, such as CDP,\2\ have seen
lackluster participation from the oil and gas
industry.\3\,\4\
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\1\ Goldman, G.T., K. Mulvey, P. Frumhoff, et al. 2017. A
Methodology for Assessment of Corporate Responsibility on Climate
Change: A Case Study of the Fossil Energy Industry. Journal of
Environmental Investing. 8 (1) Online at http://www.thejei.com/jei-vol-
8-no-1-2017/.
\2\ CDP, formerly The Carbon Disclosure Project, is a non-profit
organization that works with cities and companies to enhance disclosure
of environmental, social and governance metrics.
\3\ CDP. 2019. Explore the Scores. Online at: https://www.cdp.net/
en/companies/companies-scores.
\4\ Task Force on Climate-related Financial Disclosures. 2019. TCFD
Supporters. Online at: https://www.fsb-tcfd.org/tcfd-supporters/.
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Moreover, voluntary reporting is rarely timely and accessible.
Disclosures are often released well after the time period in which they
are useful, in formats that are not machine-readable, and in language
that is inaccessible to non-experts.\5\ In particular, privately held
companies, which have no obligations to shareholders, have been
conspicuously absent from voluntary disclosure regimes.
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\5\ Konschnik, K., M. Holden, and A. Shasteen. 2013. Legal
Fractures in Chemical Disclosure Laws. Why the Voluntary Chemical
Disclosure Registry FracFocus Fails as a Regulatory Compliance Tool.
Harvard Law School. Environmental Law Program. April 23. Online at
http://eelp.law.harvard.edu /wp-content /uploads /legal-fractures-
voluntary-chemical-disclosure-registry-fails-regulatory-compliance-
tool.pdf.
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Even when disclosure is legally mandated, companies have
demonstrated an unwillingness to provide enough--or any--information,
shifting the burden to government agencies to conduct oversight with
incomplete records. In 2010, the U.S. Securities and Exchange
Commission (SEC) issued guidance asking companies to disclose climate-
related material risks in their annual form 10-Ks.\6\ However, a 2018
Government Accountability Office report found that the SEC faces
constraints in their efforts to collect, verify, and analyze company
responses on climate-related risk.\7\ Fossil energy production
companies in particular have consistently failed to report details on
their climate-related risk, including information on the facilities
that are vulnerable to the physical impacts of climate change and the
actions companies are, or aren't, taking to mitigate those risks.\8\
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\6\ U.S. Securities and Exchange Commission. 2010. Commission
Guidance Regarding Disclosure Related to Climate Change. Washington,
DC. Online at https://www.sec.gov/rules/interp/2010/33-9106.pdf.
\7\ Government Accountability Office. 2018. Climate-Related Risks:
SEC Has Taken Steps to Clarify Disclosure Requirements. February. GAO-
18-188. Online at: https://www.gao.gov/assets/700/690197.pdf.
\8\ Carlson, C., G. Goldman, and K. Dahl. 2016. Stormy Seas, Rising
Risks: Assessing Undisclosed Risk from Sea Level Rise and Storm Surge
at Coastal U.S. Oil Refineries. In: Drake J., Y. Kontar, J.
Eichelberger, et al. (eds) Communicating Climate-Change and Natural
Hazard Risk and Cultivating Resilience. Advances in Natural and
Technological Hazards Research, vol 45. Springer, Cham, Switzerland.
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For example, after Hurricane Katrina in 2005, a refinery sitting on
private land below sea level in Meraux, Louisiana spilled 25,000
barrels of oil, contaminating city canals and more than a square mile
of neighborhood.\9\ The refinery was shut down for several months, and
Murphy Oil, which owned the facility, agreed to a $330 million
settlement.\10\ The refinery was damaged again from the 2008 hurricane
season and shut down for many days.\11\ Following this incident, in
2010 Murphy Oil disclosed to the SEC that ``the physical impacts of
climate change present potential risks for severe weather (floods,
hurricanes, tornadoes, etc.) at our Meraux . . . refinery in southern
Louisiana and our offshore platforms in the Gulf of Mexico.'' \12\ Yet,
Valero Energy Corporation, which acquired the Meraux facility from
Murphy Oil in 2011, has not disclosed any climate risks at the
facility. Valero's 2018 SEC filing noted only that there could be ``If
climatic events [such as increased frequency and severity of storms,
droughts, and floods] were to occur, they could have an adverse effect
on our assets and operations.'' \13\ If we can't trust companies to be
honest about what is happening in their own backyards, how can we trust
them to be honest about what is happening in ours? Voluntarily
disclosure is not enough.
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\9\ Environmental Protection Agency. 2006. Murphy Oil USA refinery
spill: Chalmette and Meraux, LA. Region 6 Oil Response Team U.S. EPA.
Archive document: Presentation. Online at https://www.epa.gov/oem/docs/
oil/fss/fss06/franklin_2.pdf.
\10\ MSNBC.com News Services (MNS). 2006. $330 million settlement
deal in Katrina oil spill. MSNBC.com, September 25. Online at http://
www.nbcnews.com/id/15004868/ns/us_news-environment/t/million-
settlement-deal-katrina-oil-spill/.
\11\ Department of Energy. 2009. Comparing the Impacts of the 2005
and 2008 Hurricanes on U.S. Energy Infrastructure. Online at https://
www.oe.netl.doe.gov/docs/HurricaneComp0508 r2.pdf.
\12\ Murphy Oil. 2011. 2010 SEC Form 10-K filing. Online at https:/
/www.sec.gov/Archives/edgar/data/717423/000119312513082919/
d446290d10k.htm.
\13\ Valero Energy. 2018. 2018 SEC Form 10-K filing. Online at
https://www.sec.gov/Archives/edgar/data/1035002/000103500219000008/
vloform10-kx12312018.htm.
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Companies' own investors are speaking up, too. In recent years,
shareholders at major fossil energy companies, including ExxonMobil and
Chevron, have demanded, through shareholder resolutions and investor
requests, more disclosure of climate-related risks and plans, and
expressed dissatisfaction with current levels of disclosure.\14\ A 2019
report by McKinsey found that 82 percent of investors and 66 percent of
executives agreed or strongly agreed that companies should be required
by law to issue sustainability reports.\15\ Currently, voluntary
disclosures, company annual reports, and SEC guidance are the only
resources investors have to make informed investment decisions, and
details on climate-related risk are variable and often sparse.
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\14\ Ceres. 2019. The Role of Investors in Supporting Better
Corporate ESG Performance. Online at https://www.ceres.org/sites/
default/files/reports/2019-04/Investor_Influence_report.pdf.
\15\ McKinsey & Company. 2019. More than values: The value-based
sustainability reporting that investors want. Online at: https://
www.mckinsey.com/business-functions/sustainability/our-insights/more-
than-values-the-value-based-sustainability-reporting-that-investors-
want.
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disclosure is reasonable and long overdue
The disclosures outlined by H.R. 5636 are feasible. The bill relies
on disclosure metrics set by the Sustainability Accounting Standards
Board (SASB), a leader in corporate disclosure and a reporting regime
with robust and detailed industry-specific disclosure standards. SASB
standards for the Extractives & Mineral Processing Industry and
Renewable & Alternative Energy Industry were produced hand-in-hand with
industry participation, and they align with the reporting that public
companies must anyway report annually to the SEC. Moreover, fossil
energy companies already collect data on well sites, chemicals used,
wastewater contents, and other activities on a routine basis. It is
reasonable and necessary to ask that these data be shared in a timely
and accessible way.
Further, such disclosure is long overdue. As has been documented,
other industries are subject to similar reporting requirements.\16\ For
example, the locations of hazardous waste sites, the smokestack
emissions of power plants, and the composition of wastewater released
from industrial activities all have public disclosure requirements.
Though there are limitations on the details disclosed in these cases,
much of the information is available through the U.S. Environmental
Protection Agency (EPA), so the public can learn about environmental
impacts and potential health risks. However, the fossil energy industry
has avoided this level of mandatory disclosure.
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\16\ Goldman, G., D. Bailin, P. Rogerson, et al. 2014. Toward an
Evidence-Based Fracking Debate. Online at: https://www.ucsusa.org/
hfreport.
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The activities and plans of companies extracting fossil energy on
public lands are largely a black box. Companies are subject to public
reporting requirements under the National Environmental Policy Act when
they bid to develop public lands and there are some ongoing enforcement
and inspection of operations by the Bureau of the Land Management and
EPA, but no comprehensive reporting on ongoing operations exists and
very little information is publicly available at the bidding stage. And
while companies must regularly report the quantity of extracted
minerals, communities are left in the dark about air quality, water
quality, and other measures critical to assessing public health
impacts.
H.R. 5636 provides an important opportunity for the public,
especially those living adjacent to fossil energy facilities, to access
information that has long been unavailable. For example, the SASB Water
Management Disclosures mandated in the bill would require companies
disclose details on the backflow and produced water associated with
hydraulic fracturing activities. Such information, if publicly
accessible and reliably available, would be invaluable for affected
communities and researchers who have long sought to understand the
public health and environmental impacts of these steps in the
production process.\17\
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\17\ Rosenberg, A., P. Phartiyal, G. Goldman, et al. 2014. Exposing
Fracking to Sunlight. Issues in Science and Technology 31(1):74-79.
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lack of disclosure harms the public
When people are kept in the dark about environmental and public
health risks, they are unable to answer simple, crucial questions: Can
my family drink our tap water? Should my children play in the yard? Is
our air safe to breathe? The answers to these questions can mean the
difference between an uneventful day or another trip to the emergency
room. Increasingly and disproportionately, it is low-income
communities, communities of color, and Indigenous communities that
live, work, and send their kids to school near energy production sites.
It is these communities that must ask these questions and face
companies' insufficient answers.\18\,\19\ As a result,
communities have had to advocate for themselves, negotiating with
industry, conducting community science, and fighting in the courts--all
to access information that should be public.
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\18\ National Association for the Advancement of Colored People and
Clean Air Task Force. 2017. Fumes Across the Fence-Line. Online at:
http://www.naacp.org/wp-content/uploads/2017/11/Fumes-Across-the-Fence-
Line_NAACP_CATF.pdf.
\19\ Silva, G.S., J.L. Warren, and N.C. Deziel. 2018. Spatial
Modeling to Identify Sociodemographic Predictors of Hydraulic
Fracturing Wastewater Injection Wells in Ohio Census Block Groups.
Environmental Health Perspectives. 126 (6). https://doi.org/10.1289/
EHP2663.
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For example, in 2014, a group of concerned residents, startled by
companies' lack of disclosure, worked with scientists to collect data
and publish a study on air quality at the fence lines of oil and gas
facilities in six states (Arkansas, Colorado, New York, Ohio,
Pennsylvania, and Wyoming).\20\ The researchers found elevated levels
of benzene, formaldehyde, and hydrogen sulfide--in some cases, at
levels exceeding 100 times the EPA guidelines. Communities have a right
to know about these risks, and energy producers have a responsibility
to disclose them, adequately and proactively.
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\20\ Macey, G.P., R. Breech, M. Chernaik, et al. Air concentrations
of volatile compounds near oil and gas production: a community-based
exploratory study. Environ Health 13, 82 (2014), doi:10.1186/1476-069X-
13-82.
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Lack of disclosure can have serious health consequences. In 2008,
Cathy Behr, an emergency room nurse in Durango, Colorado, was caring
for a gas-drilling worker who had developed a headache and nausea after
spilling hydraulic fracturing fluid on himself. The company refused to
reveal the chemicals in the fluid, citing trade secrets.\21\ Days
later, Behr herself was admitted to the hospital and diagnosed with
liver, respiratory, and heart failure. Behr survived, but her doctors
were forced to treat her without knowing the chemicals she had been
exposed to.
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\21\ Greene, S. 2008. Oil secret has nasty side effect. The Denver
Post. July 24. Online at https://www.denverpost.com/2008/07/23/oil-
secret-has-nasty-side-effect/.
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Lack of oversight of methane facilities can also have disastrous
consequences. In 2015, at an underground methane storage field outside
Los Angeles, a corroded pipe casing and safety failures caused the
largest known methane leak.\22\ Over a 4-month period, the leak
displaced more than 8,300 households, who left to avoid the smell and
potential health effects, including nosebleeds, nausea, and headaches.
In 2018, the company responsible, Southern California Gas Co., reached
a $119.5-million settlement of claims from the incident.\23\
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\22\ California Public Utilities Commission. 2019. Root cause
analysis of the uncontrolled hydrocarbon release from Aliso Canyon SS-
25. May 16.
\23\ Barboza, T. 2018. SoCal Gas agrees to $119.5-million
settlement for Aliso Canyon methane leak--biggest in U.S. history. Los
Angeles Times. August 8. Online at: https://www.latimes.com/local/
lanow/la-me-aliso-canyon-settlement-20180808-story.html.
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Moreover, these large-scale incidents don't tell the whole story.
Between October 1, 2011 and September 1, 2016, the Bureau of Land
Management documented more than a thousand ``Major Undesirable
Events,'' the agency's term for spills and accidents on oil and gas
leases.\24\ These examples represent irresponsible corporate behavior
that can endanger communities and erode public trust.\25\ We should
expect better.
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\24\ Bureau of Land Management. 2017. ``BLM's MAJOR UNDESIRABLE
EVENTS (MUEs) from 10-1-2011 to 9-1-2016.'' Administrative record for
the Bureau of Land Management, Rescission of 2015 Hydraulic Fracturing
Rule, 82 Fed. Reg. 61924 (Dec. 29, 2017).
\25\ Rosenberg, A., P. Phartiyal, G. Goldman, et al. 2014. Exposing
Fracking to Sunlight. Issues in Science and Technology 31(1):74-79.
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researchers face hurdles to studying environmental health from
lack of disclosure
Researchers have struggled to access the data they need to study
key questions about the social and environmental impacts of the energy
industry. For example, scientists researching the effects of
unconventional oil and gas development have been hindered by restricted
access to well sites, limited data-sharing by industry and government
officials, data concealed by legal settlements, and trade secret
exemptions in chemical disclosure laws.\26\,\27\ These
restrictions impede researchers' ability to determine how frequently
spills, leaks, and other environmental impacts occur and gauge what
steps might mitigate risks to communities and workers.\28\ Greater
disclosure requirements would remove barriers to our understanding of
energy production's impact on people and the environment.
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\26\ Colborn, T., C. Kwiatkowski, K. Schultz, et al. 2011. Natural
Gas Operations from a Public Health Perspective. Human and Ecological
Risk Assessment: An International Journal. 17(5):1039-1056. October.
Online at https://www.biologicaldiversity.org/campaigns/fracking/pdfs/
Colborn_2011_Natural_Gas_from_a_public_health_perspective.pdf.
\27\ Zielinska, B., E. Fujita, and D. Campbell. 2011. Monitoring of
emissions from Barnett Shale natural gas production facilities for
population exposure assessment. Final report to the National Urban Air
Toxics Research Center. NUATRC number 19. Online at https://
sph.uth.edu/mleland/attachments/DRI-Barnett%20Report%2019%20Final.pdf.
\28\ Environmental Protection Agency. 2012. Study of the Potential
Impacts of Hydraulic Fracturing on Drinking Water Resources. Progress
report. EPA 601/R-12/011. December. Online at https://www.epa.gov/
sites/production/files/documents/hf-report20121214.pdf.
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companies must be responsible climate actors
Leakage of methane and other greenhouse gases at fossil energy
production sites contributes substantially to U.S. greenhouse gas
emissions. A 2018 analysis published in Science found that routine
flaring contributed 18 percent of the total volume-weighted-average
carbon intensity for the United States.\29\ The Department of the
Interior is required by law to prevent energy waste like this, and to
ensure that resource extraction on public lands is conducted in a safe
and responsible manner.\30\ In order to properly manage such emissions,
companies must adequately monitor activities, and fully disclose
emissions. This is necessary to minimize the energy sector's outsized
contribution to climate change, preserve Federal lands, and protect the
public. Fossil energy companies are among those most responsible for
climate change; they have an obligation to society to disclose their
activities and minimize future risks from climate-related damages.\31\
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\29\ Masnadi, M.S., et al. 2018. Global carbon intensity of crude
oil production. Science 361 (6405), 851-853 DOI: 10.1126/
science.aar6859.
\30\ Martin, J. 2017. Testimony to House Committee on Natural
Resources: The Health, Environmental and Economic Risks of the
Republican Campaign to Repeal the Bureau of Land Management's Methane
Waste Rule. February 1.
\31\ Frumhoff, P.C., R. Heede, and N. Oreskes. The climate
responsibilities of industrial carbon producers. Climatic Change (2015)
132:157. https://doi.org/10.1007/s10584-015-1472-5.
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greater transparency needed in the current political environment
Greater transparency of U.S. energy production is needed now,
especially in light of recent executive branch actions that have
further concealed the industry from public scrutiny. The Trump
administration:
Rescinded a Bureau of Land Management rule that would have
required greater chemical disclosure, as well as monitoring
and reduction of methane pollution on new and existing oil
and gas production on public lands.\32\
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\32\ Goldman, G. 2017. Trump Administration Rescinds Fracking Rule
for Public Lands: A Blow to Public Protection. Union of Concerned
Scientists. Online at https://blog.ucsusa.org/gretchen-goldman/trump-
administration-rescinds-fracking-rule-for-public-lands-a-blow-to-
public-protection?_ga=2.210254742.2094529910.1579636272-
1783996088.1570113323.
Proposed changes to the National Environmental Policy Act
that would weaken analysis and reporting requirements and
limit opportunity for public input.\33\
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\33\ Council on Environmental Quality. 2020. Update to the
Regulations Implementing the Procedural Provisions of the National
Environmental Policy Act. Online at: https://www.federalregister.gov/
documents/2020/01/10/2019-28106/update-to-the-regulations-implementing-
the-procedural-provisions-of-the-national-environmental.
Is rolling back an EPA rule that establishes requirements
for monitoring and reducing methane pollution from new oil
and gas production on public or private lands.\34\
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\34\ Kennedy, M. 2019. EPA Aims To Roll Back Limits On Methane
Emissions From Oil And Gas Industry. NPR. August 29. Online at https://
www.npr.org/2019/08/29/755394353/epa-aims-to-roll-back-limits-on-
methane-emissions-from-oil-and-gas-industry.
Withdrew an EPA Request for Information that asked
companies for data on methane emissions from U.S. oil and
gas production.\35\
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\35\ U.S. Environmental Protection Agency. 2017. Letter to Oil and
Natural Gas Industry. March 6. Online at https://www.epa.gov/sites/
production/files/2017-03/documents/
oil_and_gas_information_request_withdrawal_letter_sample_to_post_1.pdf.
Withdrew from the international widely accepted Extractive
Industries Transparency Initiative, which provides a
vehicle for consistent disclosure and reporting of
extractive industries worldwide.\36\
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\36\ U.S. Department of the Interior. 2017. Letter to the
Extractive Industries Transparency Initiative. Online at: https://
www.doi.gov/sites/doi.gov/files/uploads/eiti_withdraw.pdf.
A recent incident at the Department of the Interior concerning a
loss of scientific integrity exemplifies the need for this bill. The
Department, weighing proposed oil and gas operations in Alaska's Arctic
National Wildlife Refuge, disregarded 18 memos from staff scientists
who had raised concerns about the proposals.\37\ The scientists
identified significant data gaps on the effects of oil and gas drilling
on the health and livelihoods of rural and Native Alaskans; the
survivability of birds, caribou, polar bears, wolves, and fishes; and
the inability to predict effects on vegetation, snowmelt, and
waterways.\38\ DOI suppressed these concerns, omitting them from the
Department's draft environmental assessment and declining to release
them to public interest groups who filed Freedom of Information Act
requests.
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\37\ Brugger, K. 2019. Interior hid scientists' criticism of ANWR
drilling: report. E&E News. Online at https://www.eenews.net/greenwire/
2019/03/12/stories/1060127067.
\38\ Public Employees for Environmental Responsibility. 2019.
Undisclosed Statements of Scientific Concern. Online at https://
my.visme.co/projects/6xo09mn7-anwr-drilling-undisclosed-scientific-
concerns.
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The disclosure requirements outlined in this bill would have
ensured public access to the kind of information suppressed in this
case. Companies would have had to disclose the potential impacts of
their operations on water resources, biodiversity, community relations,
and Indigenous rights. When citizens can access this information, they
can hold companies and decision makers accountable for actions that
could degrade natural resources, endanger health, or hurt communities.
disclosure is good governance
Companies themselves also benefit from greater disclosure. Such
disclosure mitigates financial, reputational, and legal risks. All
companies operate with a social license,\39\ and those that fail to act
responsibly can lose the public's trust.\40\ Heightened societal
awareness and public pressure can incentivize companies to act in
accordance with their responsibilities to investors and to
society.\41\,\42\
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\39\ Reuters. 2017. Shell CEO urges switch to clean energy as plans
hefty renewable spending. Online at https://www.reuters.com/article/us-
ceraweek-shell-shell-idUSKBN16G2DT.
\40\ Goldman, G.T., K. Mulvey, P. Frumhoff, et al. 2017. A
Methodology for Assessment of Corporate Responsibility on Climate
Change: A Case Study of the Fossil Energy Industry. Journal of
Environmental Investing. 8 (1). Online at http://www.thejei.com/jei-
vol-8-no-1-2017/.
\41\ Oreskes, N., and E.M. Conway. 2011. ``Merchants of doubt: How
a handful of scientists obscured the truth on issues from tobacco smoke
to global warming.'' New York: Bloomsbury Press.
\42\ Union of Concerned Scientists. 2018. The Climate
Accountability Scorecard. Online at https://www.ucsusa.org/resources/
climate-accountability-scorecard-0.
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Companies increasingly face financial risks from climate change.
Climate change-related impacts, like more severe storms and floods,
represent costly physical risks; for fossil energy companies, risks are
predicted to increase as existing vulnerabilities to natural disasters
worsen.\43\,\44\ Companies also face reputational risks as
public attitudes toward corporate behavior change. Across all economic
sectors, the transition to a lower-carbon economy will reshape the
global financial system: Models project that climate change will place
global financial assets at risk by anywhere from US $2.5 trillion to US
$24.2 trillion.\45\
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\43\ Whelan, T. and C. Fink. 2016. ``The Comprehensive Business
Case for Sustainability.'' Harvard Business Review. Accessed on July
12, 2017. Available from https://hbr.org/2016/10/the-comprehensive-
business-case-for-sustainability.
\44\ Goldman, G.T., K. Mulvey, P. Frumhoff, et al. 2017. A
Methodology for Assessment of Corporate Responsibility on Climate
Change: A Case Study of the Fossil Energy Industry. Journal of
Environmental Investing. 8 (1). Online at http://www.thejei.com/jei-
vol-8-no-1-2017.
\45\ Dietz, S., et al. 2016. Climate value at risk of global
financial assets. Nature Climate Change. 6:676-679.
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The financial sector is increasingly recognizing that climate-
related risks are material for companies. All three major ratings
agencies--Moody's, Standard & Poor, and Fitch--now recognize that
climate change represents a financial risk.\46\ Just this month, the
CEO of the world's largest asset management company, BlackRock, noted,
``The evidence on climate risk is compelling investors to reassess core
assumptions about modern finance. In the near future--and sooner than
most anticipate--there will be a significant reallocation of capital.''
\47\ A recent report by the non-profit Ceres found that half of the
companies evaluated now link executive compensation to greenhouse gas
emissions performance.\48\
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\46\ Ceres. 2016. Seven Key Actions in Steering the Oil and Gas
Sector to a Low-Carbon Future. November 2. Online at: https://
www.ceres.org/news-center/blog/seven-key-actions-steering-oil-and-gas-
sector-low-carbon-future.
\47\ Fink, L. 2020. A Fundamental Reshaping of Finance. BlackRock.
Online at https://www.blackrock.com/corporate/investor-relations/larry-
fink-ceo-letter.
\48\ Ceres. 2017. Investor Climate Compass: Oil and Gas. Online at:
https://www.ceres.org/resources/reports/investor-climate-compass-oil-
and-gas.
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Further, the United States, in its sluggishness on corporate
disclosures, is being left behind in the global race. U.S. fossil
energy companies now trail foreign oil firms like Total and Suncor,
which are increasingly heeding investor calls for better climate-
related disclosure.\49\ The European Union, for example, is working to
incorporate into disclosure requirements the recommendations outlined
by the Task Force on Climate-related Financial Disclosures.\50\
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\49\ Ceres. 2016. Seven Key Actions in Steering the Oil and Gas
Sector to a Low-Carbon Future. November 2. Online at: https://
www.ceres.org/news-center/blog/seven-key-actions-steering-oil-and-gas-
sector-low-carbon-future.
\50\ Zimonyi, S. 2018. Will Europe be first to adopt the TCFD
recommendations? London, UK: Climate Disclosure Standards Board. Blog,
February 1. Online at https://www.cdsb.net/mandatory-reporting/765/
will-europe-be-first-adopt-tcfd-recommendations, accessed September 10,
2018.
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the transparency in energy production act of 2020
H.R. 5636 provides an opportunity to enhance transparency around
energy industry operations. The following are suggested changes to
further strengthen provisions of the bill to ensure the greatest
transparency and utility of the required disclosures.
Section 3 should be amended to require timely disclosure.
Specifically, the Secretary should be required to make the
information reported under Section 2 publicly accessible at
the time it is received.
Section 3 should be amended to require disclosures be made
in an accessible format. The Secretary should require
companies making disclosure to do so in a format that is
consumable by a wide range of stakeholders, including
community members and researchers.
Section 3 should be amended to require that Agency
resources be used to increase public access. EPA and other
agencies have staff devoted to managing data and
interfacing with the public. This language would operate to
require the same at Interior.
Section 4, paragraph (1) should be amended to require
additional information be reported to Congress. Reports to
Congress should also include the other disclosure topics
and accounting metrics within the SASB Standard for the
Extractives and Minerals Processing Sector, including
Security, Human Rights, & the Rights of Indigenous Peoples,
Community Relations, Workforce Health & Safety, Reserves
Valuation & Capital Expenditures, Business Ethics &
Transparency, Management of the Legal & Regulatory
Environment, and Critical Incident Risk Management. These
metrics are required of companies' initial reporting and
could provide Congress valuable information to inform
future legislative or oversight efforts.
Section 4, paragraph (4) should be amended to provide
further clarity about the method by which companies would
calculate equivalent emissions. There are several options
for making such a calculation, and the resulting
information would be most meaningful if a method were
standardized. This could be specified in the bill, or
Congress could defer to Department of Interior experts to
choose an appropriate method.
Section 5, paragraph (3) should be amended to define
public lands to be inclusive of Tribal Land. Given the
amount of oil and gas extraction that occurs on Native
lands and the environmental justice issues surrounding
mineral extraction in Indigenous communities, greater
disclosure in this area is sorely needed and would aid
Indigenous communities in ensuring good corporate behavior
on their lands.
conclusion
When energy companies fail to disclose their human and
environmental footprints, others feel the impact. Investors face
financial risk. The public pays in tax dollars when first responders,
healthcare workers, local governments, and Federal aid services must
respond to disasters at fossil energy facilities. And nearby
communities pay every day when they are exposed to harm from routine
emissions, leaks, and other damages exacerbated by poor disclosure and
management. Companies owe it to all of us to be responsible actors.
Disclosure is good for companies, communities, and the Nation; and the
Transparency in Energy Production Act will help keep families informed,
corporations held accountable, and the public safe. This vision of the
future is worth striving for.
______
Dr. Lowenthal. Thank you, Dr. Goldman.
I would like to thank the panel for their testimony.
I want to remind members of the Committee that Rule 3(d)
imposes a 5-minute limit on our questions.
The Chair is now going to recognize Members for any
questions they may wish to ask the witnesses, and I am going to
recognize Representative Levin for 5 minutes of questions.
Mr. Levin. Thank you, Chair Lowenthal, for holding this
hearing today.
I represent a district and grew up in Southern California
where we have worried my entire life about air quality
criteria, air pollutants.
I have also been an environmental attorney, so I have seen
throughout my life the good work that we have done in Southern
California to reduce those air pollutants.
And I wanted to ask a few questions.
Dr. Goldman, one argument from the fossil fuel industry
seems to be that disclosing air pollution, greenhouse gas
emissions, water usage, pretty much any other impact is somehow
too complicated or too burdensome for them to carry out. Yet,
other industries have done this.
How have other industries been able to do this without it
being too burdensome?
And how can we learn from those experiences?
Dr. Goldman. Thank you, Congressman.
That is an important point. Many industries are already
subject to these kinds of disclosure requirements around
environmental reporting and health effects monitoring. This is
something that companies regularly do, and other industries are
required to do that under environmental laws.
Unfortunately, many of our environmental laws have
exceptions for the oil and gas industry, so they haven't been
subject to these same requirements.
But other industries have done this. It has not been
burdensome. They have been able to do this monitoring, and
indeed many fossil energy companies are doing this monitoring
to comply with other requirements or for their own information
anyway.
So, this would not add any additional burdens on them. This
is reporting what they should be doing anyway. It aligns
closely with what public companies are already asked by the
U.S. Securities and Exchange Commission to report.
And the SASB requirements that are requested in the bill
were developed with the extractives industry, so this is
something that has had extensive industry input as well.
Mr. Levin. Thank you for that. I think that is an important
point.
One of the other things that I sometimes hear is that if we
embrace clean energy or oppose continued use of fossil fuels
that somehow we are going to destroy the economy. My California
experience tells me that is simply not true, that you can grow
the economy and protect the environment at the same time.
Ms. Mason, do you believe the argument that reducing
emissions and addressing climate change is bad for business,
bad for a company's bottom line?
Ms. Mason. Thank you, Mr. Congressman.
No, I think quite the contrary actually. I think opposing
bills like the TEPA Act, simply, all it does is it provides
information to investors and the American people with some
critical data.
Undermining the economy? Because how can it undermine it?
It leads investors and policy makers to make critical
decisions. Without the information, they don't make smart
decisions from that standpoint.
I guess just as an example, imagine purchasing a house
without having done an inspection. How can the prospective
homeowner have an accurate picture of the risks around the
house?
So, I believe that as a Nation we cannot continue to invest
billions of dollars in companies that may not be viable for the
long term and sustainable, and in fact, that is what would harm
our Nation's economy.
Mr. Levin. Thank you for that.
I do acknowledge that many in the private sector are doing
a lot when it comes to sustainability, and we appreciate those
contributions.
I also do sometimes hear that government should just stay
out of it, and my follow up for you, Ms. Mason, is: do we need
Federal policies to help drive down greenhouse gas emissions,
or can the private sector do it all by itself?
Ms. Mason. The SASB is very similar to what happened with
the FASB, the Financial Accounting Standards Board. If we had
left financial accounting standards to voluntarily be provided,
the investor community themselves would be at a great detriment
to having accurate information.
So, I think voluntary information flow, even though we
would like to have that happen as individuals, I have found in
business that it really is the requirements around that that
deliver the best transparency.
That is part of why I think it is very important to have
this Act go through.
Mr. Levin. Mr. Chairman, if you can indulge one last
question for Mayor Snover, I know that New Mexico recently
regained the ability to fine oil and gas companies for
violation, which I believe is an important tool for holding bad
actors accountable.
In general, what has been your experience with the state's
enforcement over oil and gas operations?
And what role do you think the Federal Government needs to
play here?
Mr. Snover. Thank you, Congressman.
I have been in New Mexico for about 5 years, and I have
overlapped the previous state administration and our current
state administration with Governor Michelle Lujan Grisham.
In my experience, in my short tenure as an elected official
in Aztec, I have seen that we have gone from minimal
enforcement and minimal following of the regulatory guidance to
where we have really kind of turned the corner with our new
administration and become more of a national leader in this
enforcement to allow for and I feel like it has kind of put the
energy industry on notice that they are going to get held
accountable and held to the standard that is already on the
books for them.
Mr. Levin. Thank you, Mr. Snover.
Thank you, Mr. Chairman.
Dr. Lowenthal. Thank you, Representative Levin.
I now call upon Representative Westerman for 5 minutes of
questions. You can begin.
Mr. Westerman. Thank you, Mr. Chairman. And thank you to
the Ranking Member for yielding his position for me to go
first. I appreciate that.
And I appreciate our witnesses being here today, talking
about an important subject.
Mayor Snover, as I listened to your testimony and went
through it, I just had some questions to make sure I understand
your position on this.
You state that you estimate that approximately half of your
students suffer from respiratory issues and talk about how New
Mexico's methane emissions are said to have the same short-term
impacts on our climate as 22 coal-fired power plants or 28
million internal combustion automobiles.
And you also state that policy makers must establish an
ambitious goal of zero emissions from public lands and waters
by 2030.
You also have a paragraph in here where you say, ``In New
Mexico, under current regulations and rules, there is an annual
loss of $275 million in energy resources and an additional $43
million in state tax and royalty revenue that we could and that
we should be investing in our school systems. In a state where
our education system consistently ranks in the lower tier
nationally, any opportunity to increase revenue for educational
programs should be explored.''
So, are you saying you should stop energy and mineral
production on Federal lands, or is it a problem that the
revenues off of those or the royalties are not going into the
school system?
Mr. Snover. Thank you, Congressman.
I believe that we are in a transitional energy economy
right now, and I would kind of liken it to when we were
transitioning away from the horse drawn carriage. We were using
the technology we had to invent the technology of the future.
And while we are getting royalties from the oil and gas
industry, a lot of those are used for our educational programs,
and as a high school teacher in the school system in a state
that is traditionally in the lower tier nationally, I think it
is incredibly important to take every opportunity that we can
to increase funding for education.
And this is one of the ways to do it. And if we are, in a
sense, allowing that, as the Chairman had mentioned about the
methane leaks at the wellhead sites, it is basically leaving
money on the table, in my estimation, and I think that we need
to do everything we can to stem that and use our resources----
Mr. Westerman. Your position is not necessarily to do away
with energy and mineral exploration, but to make it safer and
cleaner and to redirect the royalties or increase the
royalties?
I am just trying to understand.
Mr. Snover. Well, to kind of capture the royalties, not to
necessarily redirect them, but to capture them.
And I am not suggesting that the energy industry is going
to go away in New Mexico overnight, but I am suggesting that
based on the Governor's plans to transition away to a carbon-
neutral energy environment, it is important, and I think that
is the future of our country.
And while we are doing that, we should do everything that
we can to increase the amount of data available to make best
use of the resources that we are extracting.
Mr. Westerman. I am going to have to move on. I am limited
on time.
Mr. Snover. Yes, sir.
Mr. Westerman. Dr. Goldman, you talked about accounting for
greenhouse gas emissions from energy exploration. I am
wondering if in your studies, have you looked at how much
carbon is released in forest fires and decomposition of dead
trees?
And the follow up is: should there be reporting on those
types of carbon emissions from public lands?
Dr. Goldman. Thank you, Congressman.
I think it is very important that we ensure we have as much
reporting as possible on greenhouse gas emissions. When we look
at the U.S. carbon budget, one thing that sticks out to me is
the fugitive methane leakage and other greenhouse gas emissions
from energy production sites.
This is a significant part of our----
Mr. Westerman. But I am talking about forests which cover
millions of acres of public lands, and we have seen a rash of
forest fires and exponential increase in forest fires and the
amount of carbon being released from forest fires.
I am saying if we are going to do accounting, I think we
should take that into the equation because it is all part of
the carbon cycle.
I wish we had more time to discuss, but, Mr. Chairman, I am
out of time, and I yield back.
Dr. Lowenthal. Mr. Westerman, I am allowing Members to go a
little bit over, so if you want to continue, please go at least
one more minute.
Mr. Westerman. Oh, thank you. Thank you very much.
So, I am very concerned about the environment and how we
are good stewards of that, but I think we discount the natural
environment of forests and the ability of forests to make the
air cleaner, to make the water cleaner, two of the things that
you mentioned in your testimony.
Yet, it was all focused on fossil fuels, but I think there
also is a positive side of what we can do to keep our forests
healthier, which we know is good for the atmosphere and good
for water.
Do you have anything you would like to elaborate on that?
Dr. Goldman. Yes. Thank you, Congressman.
That is something else that we should be thinking about. In
the context of this bill, I have been thinking about how to
better manage the emissions of energy production sites.
That is the scope of what we are looking at here, and we
know that that is something that we need a better handle on
monitoring of.
Many scientists do, of course, work on looking at carbon
accounting of forests and what that looks like. I regularly
attend conferences where that is a big discussion point.
I think here we need to really be thinking about how are we
getting a good handle on how energy production sites are doing
on emissions because we know from scientific studies that there
has been a range of emissions that have been estimated from
fossil energy companies.
So, in order to better understand the role that plays in
carbon emissions in the United States, we need to start with
the monitoring. We need to make sure that we have that
information, and companies are disclosing that data.
Mr. Westerman. And I think that the bill is shortsighted in
that it only looks at one side of the ledger. It doesn't
consider all the possibilities of carbon emissions and the
things that we can do to be better stewards.
There is a wealth of scientific data that also talks about
how much carbon gets released in forest fires and other events
and how much carbon we could sequester if we made our forests
healthy.
But we oftentimes have regulations that prevent any kind of
management or work on the forests, which exacerbates the cycle
of seeing these forests go up in flames.
So, on top of the fact that I don't think we should be
moving Federal regulations out to a non-profit or non-
governmental organization that is highly politically motivated,
the concept of measuring and keeping an accurate accounting of
what is happening on our Federal lands, I believe, is at least
a good starting point.
And I yield back.
Dr. Lowenthal. Thank you, Mr. Westerman.
I am now going to recognize myself for 5 minutes of
questions also.
Dr. Goldman, I would like you to tell us a little bit more
about voluntary efforts by oil and gas companies on disclosure
or self-regulation. What has been their track record on
voluntary or self-regulations?
And why have these been inadequate to protect the health of
local communities?
Dr. Goldman. Thank you, Chairman Lowenthal.
Voluntary disclosure has been inadequate. There are several
voluntary regimes, SASB included, and those do play a useful
role in providing information to investors and the public.
Unfortunately, those are inadequate because not everyone
does it, and not everyone does it well. Many opt out of such
regimes, especially those in the fossil energy industry don't
always participate in those sorts of initiatives, and even if
they do, there is often not the level of detail that we need in
order to protect the public safety and to know how companies
are operating on public lands.
Unfortunately, this is the situation despite pressure from
investors, from the SEC, and through the voluntary initiatives
to ensure that companies have more information disclosed.
For the purposes of communities and observing what is
happening on Federal lands, we need disclosure to be more
timely. We need it more accessible, and we need it to be
consistent across companies and across states.
Dr. Lowenthal. Thank you.
Ms. Mason, why are shareholders and investors increasingly
demanding that companies disclose the impacts associated with
their businesses?
Is it simply because they think it is the moral thing to
do, or do they believe that there are financial benefits of
publicly disclosing this information?
Ms. Mason. Thank you, Mr. Chairman.
I don't think that the American shareholders are
necessarily viewing this as a moral decision as it is a
financially driven decision.
BlackRock itself is a financially driven organization. If
you look at other members, even the founding member of FASB
being Goldman Sachs, CalSTRS, CalPERS, these are financially
driven organizations, and they have an interest in ensuring
that whatever businesses they invest in long term are viable
and will be around with labor returns and economic returns for
them.
In that manner, we view, or at least I do in our
organization, that the American people are shareholders in the
public lands and, therefore, they have a right to that level of
transparency just as public shareholders have rights of that
transparency in their company investments themselves.
So, it is clearly a business decision from that standpoint.
Dr. Lowenthal. Thank you.
Mayor Snover, last spring, as I mentioned earlier, the
Subcommittee visited New Mexico and heard from local experts
about the health impacts of methane emissions.
Ms. Barbara Webber of Health Action New Mexico testified in
our hearings about how the long-term exposure to ozone
increases the risk of asthma in children, and how the rate of
asthma is higher in New Mexico than the national average.
You mentioned that already in some of the impacts upon your
students, but how is your experience?
Can you go into more depth about the experience of the
impact of methane and air pollution on your students? Can you
describe that in a little bit more detail?
Mr. Snover. I will do my best, Mr. Chairman. Thank you.
First, I just want to make it clear, I am not a doctor. I
am not a respiratory doctor. I am not an environmental expert.
I am a retired Army sergeant first class. I teach Army Junior
ROTC in the small town of Aztec, New Mexico.
Dr. Lowenthal. And thank you for your service.
Mr. Snover. I appreciate that. Thank you.
But I know what I experience. I know that when we go out on
Fridays, throughout the school day we do a lot of PT or
physical training. It is stuff that the Army mandates that we
do as JROTC programs. We get a physical education credit
through a New Mexico high school accreditation.
And I often see kids running back to their bag. ``Let me
grab my inhaler just in case.'' There are days when it seems to
be especially, or it kind of spikes a little bit more than
others in the warmer months, of course.
And it is just one of those things that, again, I am not a
doctor. I am not an expert in this field. I just know what I
see, and it is anecdotal.
I am not suggesting that that is the only cause of this and
that it would completely go away, but you cannot help but ask
yourself if we have an opportunity as policy makers and as
elected officials to try to do something, that doesn't mean it
is going to fix the entire problem, but it certainly could go
at least a short distance or some distance in helping to
mitigate part of the problem.
And I think it is that piecemeal way to fix a problem that
we have to be aware of and we have to take action on any chance
we get. I mean, these kids need our help, and we should be
there and be more concerned about their health and welfare than
discussing profit and loss and cost of equipment.
Dr. Lowenthal. Thank you, Mr. Snover.
I now recognize Representative Hern for his 5 minutes of
questions.
Mr. Hern. Mr. Chairman, thank you so much. Leader Gosar,
thank you and our witnesses for being here to testify on the
importance of public disclosure requirements.
As a Congressman from the 1st District of Oklahoma, I
represent a lot of people in the oil and gas industry, and it
is 25 percent of our state budget and millions of jobs in our
state.
And I was hopeful that we would start this year off with
hearings on the right foot and recognize the importance of what
it is when we have seen what has recently happened in Venezuela
and the Middle East, how important our fossil fuel dominance
has been in the world and what it means to be a net exporter
and how important that has been to the world geopolitical
stage.
But today is just another unfortunate episode in the
relentless attack by my Democrat friends in the war on fossil
fuels and the American energy sector.
The bill before us today is no different than the policies
that have been pushed over the last year, and like the Green
New Deal, the bill would cripple our energy sector while also
lining the pockets of unaccountable, unelectable--I said
``unelectable,'' I am sorry--unelected non-governmental
organizations funded by liberal Democrat Presidential
candidates, who might be unelectable.
My colleagues across the aisle claim that this bill is
necessary because of a need for greater transparency, but this
is nothing more than a veiled attempt to hamper our energy
sector with more meaningless, tedious paperwork, more
regulation.
Additionally, this information could easily be used by
anti-energy groups looking to hinder the regulatory process
with frivolous lawsuits that provide us no benefits to the
public. It is a bad bill, will never be considered by the
Senate, and will never become law.
Mr. Stein, you talk about this in your testimony as you
note that this legislation will hamper our energy production by
imposing unnecessary costs.
You state that rather than a genuine bid for transparency,
this legislation is more accurately described as an effort to
impose higher costs on energy leasing on Federal lands.
Can you elaborate on this and how this bill would impose
these costs on energy leasing and how this would affect our
energy sector?
Mr. Stein. Sure. There are lots of ways that the way the
bill is constructed would add onto cost. You talk about the
frivolous litigation. That is already a problem with leases on
all Federal lands. We see it in Wyoming and Colorado. We have
seen leases withdrawn because of problems with the NEPA
process.
This is just adding a whole new layer of process onto that,
and every little section of these disclosures is vague about
how much of something needs to be disclosed.
Is there a certain threshold above it that needs to be
disclosed?
How is something calculated?
There are no metrics in there, so even if you go through
all of this work and do all of this disclosure, every single
section an environmentalist group can come in and sue and say,
``That is not enough,'' or ``You didn't include everything
there.''
And it basically brings the entire leasing process to a
halt, even if there is an executive in the office that actually
wants to pursue these leases.
Mr. Hern. Thank you.
It is clear these costs will be a great detriment to the
energy sector.
You also talked about the duplicative nature of this
legislation. It is my understanding that this information is
already regularly reported through the NEPA process and already
is given to the EPA.
This means the disclosure requirements will not only
increase transparency, but also will hamper the energy industry
and its ability to operate smoothly.
Could you talk about the duplicative processes?
And I think you started to allude to it a little bit with
NEPA there, but can you talk about that as well, about how they
are already reporting some of these requirements?
Mr. Stein. Sure. Well, certainly all of the air emissions,
all of the NOCs, SOCs, even greenhouse gases, are all reported
to the EPA. So, the Federal Government already has this
information.
The estimates of methane or gas that is vented or flared,
that is already filed with the BLM.
Now, it is possible that the Federal Government makes it
hard to access that information. I think that is certainly
possible, but through all of the main sections of these SASB
standards, that information is already being given to the
Federal Government.
The stuff that is not currently being reported to the
Federal Government are the sort of things that don't really
have anything to do with leasing on Federal lands, some of the
sort of global impacts.
One of the sections says that you need an estimate of how
many of your reserves are in or near conflict areas around the
world. That doesn't really have anything to do with leasing on
Federal lands.
Mr. Hern. I appreciate, again, you all being here today,
and I think it is being very clear that every step of the way
my colleagues across the aisle have been trying to curtail the
successes that we have seen in the fossil fuel industry.
And whether it is this bill or a Green New Deal, which
nobody on the left likes to talk about right now, they are
regularly overlooking the necessity of energy development
blatantly and ignoring the harm these policies would cause.
They would rather fuel the extremely litigious, anti-energy
lobby and outsource regulatory requirements to a Board funded
by their friends, who are identified as being the largest
funders, and that is Democratic Presidential candidate Mike
Bloomberg and Tom Steyer, than to advocate for reliable sources
of power and energy for the American people.
As someone who understands the negative effect my
colleagues' actions would cause on an American industry, I
cannot support their initiatives.
And, Mr. Chairman, can I ask one question for just sort of
clarity, if I may?
Dr. Lowenthal. Absolutely.
Mr. Hern. Mr. Snover, I am in a state where football is
played in the warm months. Both of my sons played outdoor
baseball. This is the first I have heard that the energy
industry is causing great harm to our kids.
Do you have a percentage?
And I appreciate your statement identifying that you are
not a doctor and this is just anecdotal, but do you have a
percentage of your kids that you think are being harmed by the
methane releases in your community?
Mr. Snover. Well, like I said, Congressman, and thank you
for the question, I cannot obviously state exactly what is
causing any respiratory issues. But I have taught in two
different parts of the country, on the East Coast in West
Virginia, and back in New Mexico in Aztec like I currently do.
And while kids in this generation, I think it is fair,
maybe have a higher propensity of diagnosed respiratory issues,
again, anecdotally, from my experience I would say 4 or 5 out
of 10 display some sort of respiratory issue.
And, again, I am not going to attribute it all to methane
gases.
Mr. Hern. But would it be safe to say if in your part of
the country, if it were due to allergies to trees and
particular plants, you wouldn't be for eliminating all of those
if that were the cause.
Like we live in one of the highest areas for allergy
contaminants known in America in the Midwest, but we are not
advocating removing all the trees and plants.
I yield back, Mr. Chairman.
Dr. Lowenthal. Thank you.
And now, Representative Lujan, welcome to the Committee,
and I recognize you for 5 minutes of questions.
Mr. Lujan. I want to thank you, Mr. Chairman. I want to
thank the Ranking Member and the members of the Subcommittee
today and the Natural Resources Committee for allowing me to
testify a little bit here, if you will.
And the reason I say that is I want to welcome our mayor
from New Mexico, Mr. Victor Snover from Aztec, New Mexico. I
know he has already been welcomed.
I have had the honor of working with and getting to know
the good mayor with his advocacy in the community. I always
appreciate his courage and his honesty in coming forward to do
what is right in our community.
So, thank you, Mr. Mayor, for being here.
Mr. Chairman, this is an important hearing and an important
piece of legislation. I appreciate the conversation.
Last April, the Natural Resources Committee under your
leadership and that of Chairman Grijalva traveled to New Mexico
to hold a hearing on the impacts of oil and gas on local
communities.
During the trip, we were able to visit an oil and gas well
in the 3rd Congressional District and not just smell the
methane emission, but with a piece of technology called the
forward-looking infrared camera, you are actually able to see
the emissions.
It was the first time I have ever looked out of one of
those cameras. You could smell it while you were there, but
what you could see through this camera were plumes as large as
anything that you can imagine.
Think about when clouds gather and you look up and you see
the immensity associated with the gathering of that humidity.
These plumes look just like those clouds, the size of any
distance that I could describe. It was alarming. It is
something to smell it, it is another thing to smell it and see
it.
To make matters worse, the Federal Government does not
properly account for how much gas is emitted from these wells
into our atmosphere. According to the Environmental Protection
Agency, New Mexico releases 205,000 metric tons. However, a
group of leading scientists by the Environmental Defense Fund
went to more than 100 sites to make on-the-ground measurements
and determined that methane emissions in New Mexico are likely
closer to 1 million metric tons, five times higher than the EPA
number.
The Transparency in Energy Production Act would simply
require public disclosure from oil and gas companies operating
on public lands, also renewable companies operating on public
lands, so that the public knows what is happening in their
backyards.
That is all that this legislation is doing and saying, and
I appreciate the information that has already been submitted
into the record. There is a table that lists everything that is
required. It is titled Table 1--Required Disclosure Topics and
Accounting Metrics for Public Land Operations.
So, in the short time I have left, Mayor Snover, as a
father, a high school instructor, and a mayor, are you
concerned with how climate change will impact the lives of
children and the future of communities?
Mr. Snover. Thank you, Congressman Lujan, and might I add a
new grandfather as well.
So, with all of those things in mind, I think all of us are
concerned about the future of our climate, and as all of those
things, as an elected official that helps provide input for
policy, as a high school teacher that sees their kids suffering
from respiratory issues, and not only that, but some of the
disparities of, like I had said in my testimony, of not being
able to move away from these areas that you described.
I was not there with you that day, but I have experienced
similar smells, not the views because I have not had access to
one of the cameras.
But, of course, I think it is a problem that we have to
tackle, we have to be proactive on, and merely saying that we
cannot afford it is not acceptable in the richest country in
the Nation.
Mr. Lujan. In New Mexico, under the leadership of our new
governor, Michelle Lujan Grisham, there was a bipartisan effort
to move legislation forward to reduce capture with a goal of
eliminating methane emissions in New Mexico. Is that correct?
Mr. Snover. Yes, sir.
Mr. Lujan. And are those conversations continuing to move
in a positive fashion with what you are aware of, Mr. Mayor?
Mr. Snover. Yes, sir. From what I am aware of, they are
moving in a positive direction. These things are always large,
complicated issues to tackle.
There are many interests to consider, but I do believe they
are moving in a positive direction, and I thank the Governor. I
appreciate her leadership on this and her willingness to get us
on the right side of history on this one.
Mr. Lujan. And last, stopping intentional flaring and
venting and leaking of natural gas is good for everyone's
bottom line. It is good for taxpayers. It is good for the
industry. Everyone will make more money, and we will have
healthier communities and better air quality if we get it done.
I am hoping that we will find a way to get some of this
done together.
I thank the indulgence of the Chairman and the Committee
for their time today.
Dr. Lowenthal. Thank you, Representative Lujan.
I now recognize the Ranking Member and thank him for
allowing his Members to go first. I appreciate that, and I
recognize you for 5 minutes.
Dr. Gosar. Thank you, Chairman.
I would like to now turn our attention to the renewable
energy projects for a moment since even wind and solar
developments do not escape this legislation unscathed.
One of the standards outlined for renewable energy projects
is sustainable sourcing of raw materials, including copper,
cobalt, rare earth, and many others. I completely agree that
this is a critical evaluation in the development of solar and
wind technologies.
But I find it very ironic to be discussing these concerns
today since my colleagues on the other side of the aisle seem
determined to prevent domestic hardrock mining at every
opportunity both in Committee and on the House Floor, even
though the country has some of the best labor and environmental
standards in the world.
Would you agree with that, Ms. Mason, that we have some of
the best environmental and labor laws in the world?
Ms. Mason. I am not an expert on labor law or environmental
laws. I can only speak from the standpoint of the businesses
that I invest in, which are not renewable energy companies or
any climate related companies.
Dr. Gosar. Well, you made the comment about Goldman Sachs.
So, if they are underlying that, I mean--in fact, I will go to
the good doctor.
Do we have some of the best environmental and mining
techniques in the world?
Dr. Goldman. Thank you, Congressman or Ranking Member. We
have----
Dr. Gosar. Yes or no, because it is a yes or no answer.
Dr. Goldman. We have protective environmental laws.
Dr. Gosar. Yes, we have the best. They have been ranked
higher than China, have they not?
Dr. Goldman. I imagine so.
Dr. Gosar. Yes, and how about India?
Dr. Goldman. I imagine so.
Dr. Gosar. How about Mexico?
Dr. Goldman. I don't know for certain.
Dr. Gosar. No, it is. Once again, these are hard facts, so
when we look at supply chains, we have to start looking at
this, particularly when we are going in, as the Mayor said, a
transition in energy production. So, this is all included.
Mr. Stein, in regard to that, can you comment on the labor
laws and the environmental dictations that we require in the
United States?
Mr. Stein. Sure. You are absolutely correct. Our
environmental standards are higher, frankly, than even in many
countries in Europe. We are very aggressive about protecting
the environment in the United States.
One of the effects of that has been that we have ended up
not developing a lot of these minerals in the United States,
but that doesn't mean that we don't continue to demand those
materials for renewables, the steel in renewables, all of the
cobalt.
Most of the world's cobalt comes from the Democratic
Republic of Congo where it is mined in essentially modern-day
slavery conditions.
Dr. Gosar. And just to that point, who is the principal
owner in the Congo of some of those mines?
Mr. Stein. Well, sometimes it is very hard to tell, but at
the ground level it is----
Dr. Gosar. Most of them are China.
Mr. Stein. Well, it is also warlords, frankly, and then the
Chinese take and extract those products because they buy from
anyone. They don't have scruples like we do about bribery and
funding.
Dr. Gosar. It also goes with one belt, one road dictation,
does it not?
Mr. Stein. Sorry. I don't----
Dr. Gosar. So, the one belt, one road is China leverages
infrastructure at the cost of having resources.
Mr. Stein. And it also involves building a lot of new coal
plants all over the world, too.
Dr. Gosar. Yes, so when you look at this, the vast majority
of renewable energy is developed on state and private land,
with only about 1 percent of the wind farms located on
federally owned lands, with the overwhelming majority on
private land.
Wouldn't this bill adversely impact investments in
renewable energy development as well as conventional energy
production?
Mr. Stein. Sure. A lot of the lawsuit risk that I was
mentioning earlier, that equally applies to wind and solar
production, and this actually happens with a lot of solar
farms, they get sued for effects on endangered species. Wind
farms also have the same problem, affecting endangered species.
So, these series of lawsuits going through each section of
the disclosure standards, that is going to slow down wind and
solar development, too, in exactly the same way.
Dr. Gosar. We are also in a dichotomy in the fact that
these alternative energy modalities are intermittent. They are
not baseload, right, Mr. Stein?
Mr. Stein. Sure.
Dr. Gosar. How do we have to look at that mitigation so
that we have a constant current going through our transmission
lines?
How do we have to look at the displaced value? Because when
you look at solar, it is after noon that we get too much of it.
In fact, California pays Arizona to take their excess solar,
which totally changes our dynamics in our marketplace.
Can you describe a little bit about that?
Mr. Stein. Sure. Because wind and solar are so
intermittent, it requires backups of some sort, and, frankly,
today most of that backup is done by natural gas.
And a lot of times in the calculations of the greenhouse
gas emissions or greenhouse gases avoided, those calculations
are not taken into account.
They are assumed that we will eventually have batteries at
some point in the future, but these batteries, it is thousands
of tons of the minerals that we are talking about being shipped
in from all over the world, processed in China, and then
produced in these batteries and then recycled.
So, all of that life cycle cost really is not included in
this cost avoidance, greenhouse gas avoidance.
Dr. Gosar. And, in fact, we have seen the other side add an
intentional prohibition of actually mining for these, even
though they are all over.
I am from the state of Arizona. In fact, Mayor Snover, I
actually have family that live in Aztec. So, I mean, we see
somebody talking out of one side of the mouth and then
completely out of the other side of the mouth.
Mr. Stein. It is true. If these minerals are not mined in
the United States, they have to be mined somewhere. To replace
our existing electricity, we are talking about 100 percent
renewables. We are talking about 12 percent of the continental
United States just in wind farms to replace current electricity
production.
That is a vast undertaking of construction, and those
minerals have to come from somewhere.
Dr. Gosar. Mr. Chairman, for the record, I would like to
submit a letter from the National Mining Association in regard
to against this bill.
Dr. Lowenthal. Without objection.
[The information follows:]
National Mining Association,
Washington, DC
April 28, 2014
Filed via Email at [email protected]
Dr. Jean Rogers
Founder and Executive Director
The Sustainability Accounting Standards Board
75 Broadway, Suite 202
San Francisco, CA 94111
Re: Non-Renewable Resources Sector; Coal Operations & Metals & Mining
Exposure Drafts for Public Comment (January 2014)
The National Mining Association (NMA) submits the following
comments on the Sustainability Accounting Standards Board (SASB)
Exposure Drafts on coal operations and metals and mining released on
January 14, 2014. SASB shared the Exposure Drafts with NMA on February
12, 2014, and hosted a webinar for NMA members on the organization and
development of the sustainability accounting metrics on March 4, 2014.
NMA appreciates SASB's willingness to educate our staff and members on
the mission and efforts undertaken by the organization in developing
sustainability accounting standards for use by publicly-listed
corporations in disclosing material sustainability issues. However, NMA
strongly opposes SASB's work to date and will not support in any manner
SASB's ongoing efforts to develop disclosure guidance or accounting
standards on sustainability topics for coal operations and the metals
and mining industry in the ``non-renewable resources sector.''
Statement of Interest
NMA is a national trade association whose members include the
producers of most of the nation's coal, metals, industrial and
agricultural minerals; the manufacturers of mining and mineral
processing machinery, equipment and supplies; and the engineering and
consulting firms, financial institutions and other firms serving the
mining industry. NMA members produce energy, metals and minerals that
are essential to economic prosperity and a better quality of life. NMA
members are committed to development that balances social, economic and
environmental considerations.\1\ NMA and our members are also committed
to the safety of employees through the CORESafety'
program.\2\ As stated above, NMA and its members do not support SASB's
efforts to date in determining and dictating which sustainability
issues are material industry-wide and consequently should be disclosed
(voluntarily or through a formal rulemaking process) in annual (i.e.,
Form 10-K or 20-F) or periodic filings to the U.S. Securities and
Exchange Commission (SEC).\3\
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\1\ See NMA Position on Sustainable Development at http://nma.org/
index.php/position-on-sustainable-development (last visited April 8,
2014).
\2\ CORESafety is an approach to mining safety and health focused
on preventing accidents before they happen, using a management system
approach to drive continuous safety improvement. Its objective is to
have zero fatalities and a 50 percent reduction in mining's injury rate
within 5 years (0:50:5). CORESafety is the first system to integrate
leadership and culture into an industry management system that includes
self-reporting. See http://www.coresafety.org/.
\3\ NMA's membership consists of U.S. and foreign public companies
that are listed on the U.S. stock exchange and comply with existing
U.S. Securities and Exchange Commission (SEC) regulations and filing
obligations. NMA's membership also consists of private companies not
governed by SEC regulations.
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NMA's Objections to the SASB Approach and Exposure Drafts
1. The SEC's Existing Rules are Comprehensive: Companies listed on
the U.S. stock exchange are already required to report
material risks in their regulatory filings with the SEC,
including sustainability information that a company deems
to have a material impact on its current or future
financial performance. If the SEC wanted additional
disclosures from companies, it would pursue informal or
formal guidance to elicit additional information.
Additionally, any stakeholder interested in obtaining further
information from a company on its sustainability
performance may contact that company directly to encourage
additional disclosures and engage in direct dialogue with
the company on these issues. SASB's efforts to intrude into
this process as a third party and push an aggressive
campaign on expanded disclosures that are irrelevant to
what a ``reasonable investor'' would expect from companies
is entirely inappropriate. In the end, the company and not
SASB is in the best position to determine what
sustainability information is material to its operations
and whether it should be disclosed. Furthermore, there are
a multitude of robust voluntary disclosure programs on
sustainability that SASB ignores in the development of its
program, which only results in an additional scheme that
does little to provide clarity and continuity for companies
or their investors.
2. SASB's ``One-Size-Fits-All'' Approach Improperly Expands the
``Materiality'' Standards under Current SEC Law: In its
briefing of NMA members, SASB proclaims that companies,
within the confines of U.S. Supreme Court precedent, define
``materiality''. However, SASB's entire approach is to
determine for an industry sector what is ``material
information'' and ``materiality'' for disclosing
sustainability issues. In the Conceptual Framework, SASB
states that an aggregated analysis at the industry level is
appropriate ``because companies that provide similar
products and services tend to have similar business models,
use resources in similar ways, and therefore tend to have
similar impacts on society and the environment.'' See SASB,
Conceptual Framework at 9-10 (October 2013). SASB goes on
to explain that ``analysis of the impact of sustainability
topics at the industry-level is meant to provide guidance
for disclosure on sustainability topics that are likely to
be material at the company-level.'' Id. at 1O (emphasis
added).
This analysis turns the whole concept of a ``materiality''
determination on its head. By acting as the self-empowered
arbiter on sustainability accounting metrics--metrics that
are based on largely insupportable research and findings on
the regulatory trends and sustainability-related risks
facing the industry without meaningful participation of
industry experts--SASB acts in direct conflict with SEC's
approach to entity-specific materiality determinations and
the Supreme Court's fact-specific standard. Furthermore, by
creating an ``industry materiality'' standard, SASB ignores
the incredibly important fact that companies within the
mining sector operate under a unique set of circumstances
(i.e., the region in which a company operates, the scale of
the operation, the grade of the ore mined and how it is
processed, the ownership and size of the operation, etc.).
Therefore, what is material for company ``A'' will not be
material for company ``B.'' Providing ``industry
materiality'' guidance will only serve to confuse
shareholders and other stakeholders into believing that all
of the activity and accounting metrics identified by SASB
are material and companies that do not disclose all of them
are misleading investors. SASB is not ``complet[ing] the
picture on corporate performance'' as proclaimed by the
organization in its presentation, but creating a system of
disclosure that will mislead and confuse investors in their
investment decisions.
3. SASB's Reporting Requirements are Largely Inappropriate, Go
Beyond the ``Reasonable Investor'' Standard and are
Inappropriately Forward-Looking and Speculative: Given our
opposition to SASB's actions to date in developing these
industry sustainability accounting metrics, NMA will not
provide a thorough critique of every topic and accounting
metric provided in the Exposure Drafts. As a whole, NMA
objects to the Exposure Drafts for coal operations and the
metals and mining industry and lends no support to
individual topics or metrics identified. However, given
this opportunity to comment, there are several important
overarching concerns with the approach SASB has taken.
First, many of the metrics do not even meet SASB's own
criteria of being relevant/useful, cost effective,
comparable and auditable. Second, many of the metrics are
not reflective of the ``reasonable investor'' standard
under U.S. securities laws. Finally, some of SASB's
reporting requirements are inappropriately forward-looking
and speculative and beyond what the SEC requires. For
example, speculation on the potential for greenhouse gas
emissions embedded in proved coal reserves are not base
level risks to investors. Such metrics do not account for
advances in control technology that are arguably more
relevant to investors than the metrics identified by SASB.
All in all, NMA strongly opposes the finalization of the Exposure
Drafts for coal operations and the metals and mining industry. NMA will
not support this initiative as it moves forward and will advocate
against the adoption of these standards in any future rulemaking
proceedings with the SEC.
Sincerely,
Tawny A. Bridgeford
Deputy General Counsel
______
Dr. Gosar. And one last point. When we talk about
transparency and evaluation, I find it interesting that we
still do not have the dissertation about climate, what was
actually done for background to have all of the information,
how it was actually looked at.
I am a believer that climate always changes, but we need to
have all the data and how it was collected, where it was
collected and making that transparent for the American public
because that has never been disclosed.
I yield back.
Dr. Lowenthal. Thank you, Mr. Ranking Member.
We are going to be closing this hearing, but before we
close the hearing, I would like to ask each witness one last
question.
What is the one question you were not asked today that you
wish you were asked, and what would be your answer to that?
So, is there any question? If you don't think there was any
question, then just say no, but is there one question that you
were not asked that you wished you were asked by the panel up
here, and what would be your answer to that question?
I am going to start with Ms. Mason. Is there any question
you were not asked that you came prepared or you would have
liked to have been asked?
If not, that is fine.
Ms. Mason. I think actually the Committee did an excellent
job of the questions across the board, so I have nothing to
add.
Dr. Lowenthal. OK. Thank you.
Mr. Snover, is there one question that you would have liked
to have been asked that now is your opportunity and what is
your answer or you would like to elaborate on some answer?
Mr. Snover. Thank you, Mr. Chair.
I would just like to maybe touch on the Energy Transition
Act that was enacted in New Mexico last year, which included
$40 million to help northwest New Mexico transition away from
coal, and whether I support providing transition assistance to
impacted communities.
And my answer is, of course, because as we had talked
through some of the questions and answers and some of the
testimony about transitioning our energy economy to a more
renewable energy economy, there are going to be people who are
kind of lost or potentially left behind in these transitions,
folks that are, I mean, I hate to admit it but my age, in their
early 50s and older that have been in a career for decades
perhaps, and they know nothing else. They don't possibly have
any other readily marketable skills.
But I think it is our obligation as elected officials and
policy makers that we have a role to play to provide the best
possible outcomes for those hardworking New Mexicans,
specifically that they just want to provide a good life for
their families, they want to be able to pay their bills, and
they want to have pride in what they do every day.
And as we transition into this new energy economy, they
don't have time to worry about what we are doing here today.
They are just trying to go to work and make a living.
I think it is important that we support these laws such as
the Energy Transition Act in New Mexico and try to give these
folks as much opportunity to move into the next phase of their
careers as possible.
Thank you, Mr. Chairman.
Dr. Lowenthal. Thank you, Mr. Snover.
Mr. Stein, any question that you would have liked us to ask
or you would like to elaborate on some answer? This is your
opportunity.
Mr. Stein. Sure. Thank you very much, Mr. Chairman.
I just want to point out the question here is why this
needs to be put on the private sector. As I said, a lot of this
stuff is already reported to the Federal Government.
If local communities or independent groups are not able to
get this information, that is a government transparency
problem. It is not the companies themselves that are not
sharing this information.
So, I think the question is why this cost needs to be put
on the private sector rather than being put on these agencies
whose job it is to monitor these sorts of things anyway.
Dr. Lowenthal. Thank you.
And, Dr. Goldman, one question or something you would like
to elaborate on?
Dr. Goldman. Thank you, Chairman.
I want to address the question of why this matters. Why
does disclosure matter?
When I think about that, I think about the fact that this
matters to the more than 8,000 residents who were displaced
from their homes during the Aliso Canyon disaster a few years
ago.
And it matters to the Indigenous communities that are
living downstream of energy production sites without even
knowing what might be being emitted into their waterways.
And it matters to the countless people in this country who
live in the shadow of energy production sites and wake up every
day wondering if their headache or their child's nosebleed is
the result of toxic pollution from a nearby facility.
We owe it to them to ensure that this vital information is
disclosed. This bill has requirements that are feasible and
long overdue for companies, but more importantly, this bill is
necessary and urgent for the American people.
Dr. Gosar. Mr. Chairman, could I ask a question of the
Chair?
In Arizona, we have the Navajo Generating Station, and as
you know, the tribes actually are under the purview of Congress
because of a trust agreement.
How would this legislation work when we have the trust
responsibility? Would the Navajo Nation be responsible to
report to this Board? Because it seems very odd and a
contradiction of our due diligence under the Constitution.
Dr. Lowenthal. To answer your question, as it is written,
it does not apply to the tribes at all.
Dr. Goldman. If I may, may I elaborate on my comment?
Dr. Gosar. Well, once again to the Chair, that sets one
standard for one set of people and a different set for another.
Dr. Lowenthal. That is why we call it sovereign nation.
Dr. Gosar. OK. Now that you opened up that worm, once
again, they are wards of the Federal Government because they
come every year to the United States under the auspices of
appropriations. A sovereign entity has no entailments to
another government. It is a pseudo type of application.
So, once again, how can we establish one standard for one
group of people and yet not another?
Dr. Lowenthal. Well, we do, and I would be willing to work
with you to discuss that issue in a hearing. I think you have
raised an important issue. We do not deal with that in this
bill at all.
But you have raised an issue that I don't think has to do
specifically just with this bill. It has to do with all bills
that really have to do with when we are talking about dealing
with Native Americans on their designated land.
So, I would be willing to work with you. I think that is an
interesting question that you raise. How can we have two
standards?
Dr. Gosar. And it goes beyond that because we have had some
discussion in regard to Chaco Canyon. In regard to an amendment
that is the requirement because of the Native Americans who
have allotments behind that aspect. They have to be able to
have access and to increase their claim.
So, once again, we keep running into this roadblock, and I
think it is something that we ought to address sooner than
later in that regard.
From that standpoint, I just wanted to bring that up.
Dr. Lowenthal. Thank you.
With that, I believe that we have kind of completed the
hearing, and I would like to say that the members of the
Committee here may have some additional questions for the
witnesses, and we are going to ask you to respond in writing
for any additional questions.
Under Committee Rule 3(o), members of the Committee must
submit their witness questions within 3 business days following
the hearing, and the hearing record will be held open for 10
business days for these responses from the witnesses.
If there are no further questions and no further business,
without objection, the Committee stands adjourned.
[Whereupon, at 11:27 a.m., the Subcommittee was adjourned.]