California Continues to Inflict More Costs onto the Energy Used by Residents

Rather than reducing demand, the state imposes more costs on the supply

By Ronald Stein

Ambassador for Energy & Infrastructure, Irvine, California

The 9th Circuit Court of Appeals decided on May 28th that climate lawsuits filed by San Mateo County and the cities of San Francisco and Oakland asserting a California public nuisance claim against five energy companies arising from the role of fossil fuel products in global warming can proceed in state court. The lawsuits utilize an obscure area of the law called “public nuisance” to place the blame for global climate change on a few energy companies that develop and sell the energy used by consumers and businesses.

What San Francisco, Oakland, and Governor Newsom fail to understand is that the oil and gas industry is not just a California business with its few refineries,  but an international industry with more than 700 refineries worldwide that manufacture the derivatives from oil that are needed to make more than 6,000 products, as well as the various fuels to the world to operate planes, trucks, construction equipment, merchant ships, cruise ships, and automobiles.

Without the California energy suppliers operating in the 5th largest economy in the world, the state would become a national security risk for the entire country being dependent on foreign countries for our existence.

If the GND ever gets fully implemented in California, we’ll have no refineries manufacturing in -state. We would be getting all those thousands of products from the derivatives from oil, and our fuels from foreign refineries via ships to our ports. Newsom may have difficulty suing offshore refineries for their nuisance to society!

When placed in the context of more onerous regulations during a global pandemic ravaging the American and California economy, this environmental crusading is particularly concerning. Despite this fact, certain voices in the environmental movement have continued to leverage the pandemic to attack the suppliers that only exist to meet the demands of society.

California has methodically driven most manufacturing out of the state, as it’s been more cost effective to import much of the demands of our society from locations outside the state that can manufacture our needs and transport them to the state. 

This “outsourcing” concept has yet to be realistic for the daily demands of jet fuel, diesel fuel, gasoline, and for all those derivatives from crude oil that are needed by thousands of products in our daily lives. If it were more cost effective to import those energy needs from foreign locations, it would already be in place.

The COVID-19 induced impacts on our social lifestyles, was a virtual shutdown of airports, cruise ships, most forms of transportation, restaurants, and the leisure and entertainment industry. The resultant reduction in demand dramatically impacted the supply chain for all the energy needed to meet the social needs of society.

The pandemic gave us a preview of what weaning our economies off fossil fuel-addiction that our social lifestyles have become, as we try to accelerate the transition to greener alternatives of intermittent electricity from wind and solar. 

During the quarantine, it was almost like living in the 1800’s with virtually no transportation systems, but and that’s a BIG BUT, we were able to survive the quarantine as we benefited from all those products derived from the derivatives from oil that produced all the critical medical equipment like ultrasound systems, ventilators, CT systems, and X-ray, medicines, masks, gloves, soap and hand sanitizers for hospitals, and protective gear for doctors and nurses, and all the electronics and communications equipment that allowed us to work virtually. 

Yes, we may be using fossil fuels too extensively for leisure, entertainment, and travel but the developed world is where it is today, healthier, and wealthier, because of all those products we get from those oil derivatives. As we weed ourselves from oil, we will need to lower our demands for leisure, entertainment, and transportation infrastructures that COVID-19 has shown us the way.

The same politicians that are thrashing on in-state energy suppliers, and seeking their demise, are the same ones reaping the benefits of the medications, medical equipment, communication networks, and the thousands of other products from that industry that have contributed to their lifestyles, and their ability to live beyond 80 years of age. 

All the lawsuits and bizarre laws and regulations against the local energy suppliers will most likely result in a hodgepodge of lawsuits across the nation that burden our court system, create uncertainty and fail to create any real solutions. They will continue to invoke more self-inflicted costs on the suppliers to be paid by the users.  In the meantime, those 700 foreign suppliers remain ready to meet the demands of society.

The costs to import the energy into California from those foreign suppliers to meet local demands are currently more expensive than we are now paying, which is already the most expensive in the country. The emissions from those foreign refineries will be greater than those in California as foreign environmental regulations are significantly less stringent than those locally.

Until the voters say enough-is-enough, the infliction of more costs by our elected officials and environmentalists onto the suppliers, that are paid by the users, will continue into perpetuity.

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44 thoughts on “California Continues to Inflict More Costs onto the Energy Used by Residents

  1. Big CO2:
    Saudi Aramco
    PJSC Rosneft
    National Iranian Oil Company
    China National Petroleum Corporation
    Kuwait Petroleum Corporation
    PetroChina
    After litigating the above they can move on the smaller players . . .

  2. As an Arizona resident, I’m connected to the Western US grid and have watched my Tucson Electric Power retail home electrical bill electricity rates slowly increase over the last 7 years, even though wholesale cost of electrical generation in Arizona has decreased dramatically due to the decline in the cost of natural gas. The reason of course is electricity is priced due to supply and demand. Decrease structural supply and prices will go up. Basically, California is off-shoring its electric generation emissions to other states and demanding Wyoming residents tolerate the wind turbines it doesn’t want in California, while everyone pays higher electric bills for DPRK’s green virtue.

    And so California has decided to destroy it’s in-state electrical generation infrastructure by closing nuclear (San Onofre and soon Diablo Canyon) and also gas-fired generation plants, and then claiminga replacement by name-plate capacity wind and solar solar of those baseload sources. Of course everyone here knows that’s a lie.

    The result of course is structural baseload electrical supply decreases across the entire Western grid when a big state like Democratic People’s Republic of Kalifornia destroys its in-state baseload supply in the name of climate virtue. And California likes to import Arizona’s Palo Verde nuclear-generated power and are willing to pay higher prices to do that, since it’s “emissions-free.” What California has effectively done is drive up the cost of electricity for every one in the other states that are connected to the Western grid. Cal’s greentards are driving up every other’s states electric too since there are interconnects that allow out-of-state suppliers to send them electricity and high spot market prices.

    The only silver-lining is the California greentards have blocked new inter-state interconnects so the situation can’t get too much worse since Cal can only import so much power over those few interconnects that exist.

    That’s where the FERC should be able to jump-in and overrule Sacramento’s Green idiots and regulate California’s generation mandates that adversely affect interstate electricity prices. And if FERC can’t ell Cal not to close anymore gas power plants, then FERC should mandate that Cal can only import so much electricity. Let Cal’s residents deal with the blackouts. Thus force Cal’s politicians to not offshore their emissions-free power from wind power to Wyoming and Utah and their nuclear power from Arizona.

    • “That’s where the FERC should be able to jump-in and overrule Sacramento’s Green idiots and regulate California’s generation mandates that adversely affect interstate electricity prices.”

      California should not be able to cause electric rates to increase in other States. If they want to ruin their State, that’s their business, but they shouldn’t be able to foist their political agenda on the States around them.

      This situation needs an outside intervention.

    • I add to the facts discussed above by Joel O’Bryan.

      California imports of electricity are even more extensive than those outlined above. California imports a great deal of hydropower electricity generated by the Bonneville Power Administration dams in the Pacific Northwest. Wholesale BPA electricity prices in Oregon and Washington have been rising steadily, partly because of the California demand increasing the market price. I recall that it was the GW Bush admin that decided to allow the export demand to increase the wholesale price based upon a free market principle. It occurs to me that a state which intentionally reduces their generation for political reasons, and as a result, shifts the cost to residents of other states should be challenged.

      • Bill Rocks –

        It isn’t only the hydropower from the Northwest. Years ago when I was touring Hoover Dam, I made the comment that all this hydropower must be why Los Vegas can afford the neon-lite Strip. “Oh no” I was told. “All the power from the Hoover Dam goes to Los Angles.”

  3. $54.3 billion is currently the Associated Press (June 3rd) reported estimate of the California budget deficit. Seems shutting down the state economy to “flatten the curve” & then keeping
    the edicts in force has caused the implosion of California’s revenue stream. The O.P. lawsuit going forward is not going to top up state coffers anytime soon.

    • The purpose is to turn fossil energy use into a vice where 50-100% taxes or more are acceptable. Driving costs higher impacts the poor most and will accelerate their emigration. This is a part of a long term gentrification plan.

  4. How can a State Government or court penalise a company for:
    1) selling a legal product which is used by the State government and it’s citizens and meets local standards?
    2) legally selling a product outside of it’s borders where the users our outside the jurisdiction of the State?
    3) the correct use of the product produces CO2 which cannot be avoided but is very expensive to capture or mitigate/offset?
    4) CO2 emissions of its customers which are outside of it’s control?
    5) selling a legal product which is used by the Federal Government which won’t accept anyone interfering with supply for military (national security)?

    Why doesn’t the State cut out the middleman and just sue itself for stupidity (ie. the CO2 emissions of the State)?

    • Liberal judges decide first what the proper ruling should be, then they seek someway to distort the law into supporting their decision.

    • I wish they could refuse to sell any oil products to them. I hear doctors when being sued by patients, refuse to see them(class action stuff initially sues the doctor).

  5. Why would California import from foreign countries when they could import from Texas for example?

    • Because the distance to China is not as different as the distance to Houston via the Panama Canal as you might think. Of course, pipelines could fix that, but those are out too.

  6. I really fail to understand why ‘all’ oil companies refuse to supply the state of California any refined oil whatsoever, for a short period of time, until the good burghers of that beautiful state decide ‘enough is enough'(?)

  7. Ya wanna here the worst

    Wind turbines do not produce the legally required 60Hz energy
    They do produce a whole lot of useless harmonics
    The smart meters fraudulently add all this dirty energy onto consumers power accounts
    They are useless and cannot boil a jug

    When all this is sorted out we will talk oil and not before

  8. Time for energy suppliers to listen to Sacramento. I propose a one day coordinated Green Stand Down. Shut all the gas stations and natgas generators and hold employee awareness meetings. Discuss the possibility of withdrawing from the California market out of guilt and shame.

  9. From the article: “The 9th Circuit Court of Appeals decided on May 28th that climate lawsuits filed by San Mateo County and the cities of San Francisco and Oakland asserting a California public nuisance claim against five energy companies arising from the role of fossil fuel products in global warming can proceed in state court.”

    What is the role of fossil fuels in Human-caused Global Warming?

    As far as I can see, there is no role, since there is no evidence that fossil fuels are causing the Earth’s climate to do anything it otherwise would not do.

    I think a courtroom would be a very good place to make a case that there is no evidence that humans are causing the Earth’s climate to change due to fossil fuel burning.

    There’s no evidence. A competent judge ought to be able to figure that out. They can figure out when there is no evidence in a criminal case, and they can do it for human-caused climate change, too.

    Your average skeptic poster on WUWT could knock this case down. It’s not that complicated. All the alarmists have are guesses and assertions based on those guesses. That’s not evidence. A judge can figure that out.

  10. ‘Yes, we may be using fossil fuels too extensively for leisure, entertainment, and travel but the developed world is where it is today, healthier, and wealthier, because of all those products we get from those oil derivatives. As we weed ourselves from oil, we will need to lower our demands for leisure, entertainment, and transportation infrastructures that COVID-19 has shown us the way.‘

    So, keep oil/energy prices low for the good of society…and stay in your homes and enjoy 1800’s era activities for the good of society. In response to this I’ll Drive my large and inefficient pick up to my favorite steak house and eat an unreasonably large steak.

    • What does “weed ourselves from oil” mean? Are Californians getting high from oil or, should it be “wean”?

      • I’ve been sitting at home for so long that I could swear that grass has started growing between my toes.

    • Why do you believe that other people are spending too much energy on “leisure, entertainment and travel”?
      Beyond that, why do you believe that your opinion on this subject matters?

      Beyond that, why on earth do you believe we need to ween ourselves off of oil in the first place?

  11. I think CA needs to just complete the secession from the US….it’s what they’ve been trying to do for decades, just up and make it official OK? You want to stand on your own, despite being heavily dependent upon the surrounding states (NV and AZ especially), then do it and see how far you get. The former US citizens will burn the entire state down (with 1 match because you idiots stopped properly burning the underbrush) because of your stupidity and all the cows will come back to the Midwest (where they ARE happy cows).

    /sarc

  12. I admit I have not read the lawsuit. But I still have a huge question about how the judge will assess damages if the plaintiffs prevail. And how will those damages be paid?

    A tariff on all oil, gas, and plastic products sold in the jurisdiction of the plaintiffs?
    A lien on the profits of the oil companies? Since that would have an impact on out-of-state stakeholders, how would the lien be apportioned?
    A direct tax on the oil companies? Since judges can’t levy taxes just how would that be implemented?
    A one time payment by the oil companies?

    If you can’t asses the amount of damages and it is no possible to accurately apportion the payment of damages, doesn’t this make the entire thing into a frivolous lawsuit?

    • Bigger question: just what damages has anyone incurred? You can include future impact of an actual harm – like loss of future wages due to an injury – but you cannot sue for an expected future injury. You must have actual, provable, existing damages.

  13. ‘ During the quarantine, it was almost like living in the 1800’s with virtually no transportation systems, but and that’s a BIG BUT, we were able to survive the quarantine……’

    You don’t need to go to x-ray machines etc, the reality is much simpler and more in your face. Without fossil fuels a city can not grow and especially transport enough food into the city to feed itself.
    People live in this weird dream where a lock down means ‘virtually no transportation’. This is incorrect, in fact all required transportation is still up and running just to supply food to the people, how do you think supermarkets get their supplies? You didn’t see any ‘sorry no food today’ signs during the ‘lockdown’ did you?

    So rather then being a public ‘nuisance’ Fossil fuel transportation is a public ‘necessity’, people will start dying within a week without food. Any sane judge should see this benefit/requirement for society to function and throw this case out of court immediately. I don’t understand why the oil companies let themselves be dragged into arguments about (relative) sealevel rise, social cost of carbon and all the other crap when the case could be resolved so much simpler.

    Oh and please don’t start with ‘electric vehicles’ without taking the emissions from manufacturing into account. At best ‘all electric’ transportation would be a (small?) percentage reduction in overall emissions, not an avoidance.

    People should be a bit more grateful to those working and risking infection to enable the ‘risk free’ lifestyles they enjoy.

    Stay sane,
    Willem

    • Anyway, didn’t Los Angeles trial some electric buses? Which didn’t work – because they couldn’t pull a load of passengers up some of LA’s hills?
      Good luck with going 100% ‘green’, LA!

  14. According to the Chinese war theory called “Unrestricted Warfare” – lawfare is warfare. So these people and courts are waging a war against energy corporations.

  15. AGW, Outsourcing, and Globalization are media driven events manufactured for only one reason …. wealth redistribution. California is a Marxist ideology driven state, what more can be said?

  16. Thus the 9th Circuit Court of Appeals and several California cities are national security threats.

  17. By Ronald Stein

    Until the voters say enough-is-enough, the infliction of more costs by our elected officials and environmentalists onto the suppliers, that are paid by the users, will continue into perpetuity.

    The only problem is, ….. there are far more voters who are saying “enough-is-NOT-enough, …… give us more, more, more”.

  18. I say give San Mateo County and the cities of San Francisco and Oakland what they clearly want by publicly agreeing to stop selling (evil) fossil fuel in that county and those two cities.

    The defendant companies should give notice to their local distributors and run ads in all the papers announcing their intentions – and the reasons why.

    Let the games begin!

  19. Ronald, Help me out here. My understanding is that ambassadors are regularly appointed positions of top tier authorized connection to an external jurisdiction. It remains unclear in your case what the appointing agency is should I care to refer any lofty statements on energy and infrastructure to an interested party. And should we take Irvine California as your sending office or the receiving posting?

    Now if in all honesty you are a self-appointed emissary to the universe, be a real mensch and feel free to say so. Were you so convinced you’d be taken as a lesser voice here on your own reasoning powers and fitting experience without the grand entree? No doubt a waiting world looks forward to your candid clarification.

  20. It’s all OK. California will be driving electric cars and trucks powered by their wonderful solar and wind energies. No one actually needs hydrocarbons for anything important.

    (What is so very sad is they actually believe this.)

  21. R. Stein
    Typo fixed: 4th paragraph “… we’ll have no refineries NOR ANY manufacturing in-state.”
    Nice article, filled with a lot of commonsense that is sorely lacking in California government & the
    MSM. The citizens are mostly dupes. This energy Ponzi scheme based on wind & solar can not continue forever.
    Then I suspect the prices will rise high enough (or enough blackouts) we will see the gilets jaunes (yellow vests) appear. The result will not be pretty.

  22. My former company is a large supplier of Gas turbine generator packages. Over the years the California Governors have been virtual signaling “OH look at the other states around us that have had their emissions increase dramatically while We GREEN Californians are keeping ours at a lower level.”

    Puzzle this out with me. My old company installed over 186 generator packages over the last 10 years in groups on the California borders but in the bordering states. The installations were situated close to a Natural gas supply pipeline and in range of an existing high voltage line to allow for the power to be pushed into California. Almost none of the power produced by these units is used by the states they are situated in. For the privilege of accepting the emissions from these generators the home states get to charge an export fee / tax to California’s rate payers for this power.

    During the forced power outages in California last year because of the fire hazard caused by failed power lines. Would it not have been better to situate SOME or ALL of these machines in the state of California. These machines are all remotely operated and controlled. They can tie into the grid and run at ANY load required up to full name plate at ANY time. If there was a problem with a transmission line then if there were a number of these machines in an area of a town or city you could separate from the rest of the grid shutdown the affected transmission line and keep the power on to your rate base in “Island “mode. When the wind event ends these machines can get the signal from central control to rejoin the grid and synchronize back to the grid system automatically. The affected transmission lines could then share the loads and power production as normal.

    I maybe over simplifying this type of design and operation but I have a hard time understanding why the rate payers in California are putting up with this stupidity from their elected government representatives. When you see the poor residents of California having to live like a third world country because of poor governance I would be pressing EVERYONE to oust these losers and bring some sanity to the asylum.

    One thing I can add to this is these generators ARE modular and to move them to a new location is not all that hard. They do not take up much room and all they need is a level pad of concrete about three feet beyond the base frame to setup. Most areas of California are already serviced with natural gas supplies so these units could be setup in most of the towns and cities that were affected by these past power outages.

  23. If you’re really confused about why Californians put up with their political leadership, let me connect the dots that have been described so well here without wanting to go so far as to blurt out the full shameful truth:

    California is becoming all about signalling more convenient replacement virtues for all those old foundational ones (we now abort half of our children so they won’t embarrass our conceptive conduct). We’re all about what looks good and feels good in place of trying all that hard to be good — and we’re not alone but proudly lead the way to the literal flames. Thus, as the self-satisfying ingredients were well described, if we have to burn down (the town of) Paradise or put up with city street poop, we’ll just find some way to blame God or sue someone into bankruptcy and plod blindly onward, just so we don’t have to look in the mirror. We might even complain about our pols to further the impression that they don’t represent most of us all too well. That’s about the size of the muck we’re comfortable with hereabouts. How ’bout yourself?

    • We in Canada are saddled with a Federal political system that is rife with corruption and We are been pushed into communism by our Sock Boy soya boy. While virtual signalling to the world that his government is behind the global warming or climate change mantra this bastion of virtue has a carbon footprint larger than a number of small countries combined. As an example of his waste of jet fuel Trudeau was using the Canadian government fleet of jets like they were his own to abuse with out any over sight. Trudeau had logged just over 200 separate flights last year and did not think to bat an eye to fly across the country not once but twice just because the surf was up on the west coast and it was a great photo op before the election last year. When called out on his wasteful flying Trudeau doubled down and “bought off” all of the main stream Fajke news outlets including a majority of news papers in the country so there is never a discouraging word against him and his band of merry thieves.
      Trudeau’s ex climate mister was pushing the climate change propaganda to the point that Climate Barbie declared and voted in the Canadian House of Parliament that Canada is in a climate emergency and proceeded to jack our wonderful carbon tax to compensate for our evil fossil fuel using ways. The this other virtue of the Climate crowd jumped on. Jet with 230 other delegates to attend her fourth climate Conference where in the past the conservative government under Stephen Harper sent only 35 delegates on an average. Even though Canada is only 1.5% of the total worlds CO2 emissions Climate Barbies group was always in the top three for delegate size at these useless events.
      Climate Barbie has moved on but not far enough for most Canadians after the last election her new prof folio is infrastructure spending. Just before Trudeau declared parliament closed till September it came out that the infrastructure program had given out 186 million dollars for 52000 projects. When pressed the infrastructure ministry could only come up with an actual list of just over 32000 projects that accounted for 2/3 of the money spent. As of today 1/3 of the 186 million dollars is missing and Climate Barbie is not answering her phone or email.

      So that is how it is going where I sit thank you very much.

  24. Rescinding / reversing / ELIMINATING the Endangerment Finding would be a great start.
    I never understood how the very molecule that sustains life is also a toxin, requiring government intervention.
    It has become Crystal Clear, now.

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