Big Oil and enviros agree: Surging prices were nail in coffin for offshore-drilling ban
The 110th Congress achieved some notable victories for the environmental community. The Democratic majorities secured the first major increase in automobile fuel-economy standards in nearly three decades, along with tougher efficiency rules for household appliances. They extended tax credits for solar and other renewable energy sources. Serious discussion of climate legislation got underway in the Senate, while the House approved an energy bill with the first national renewable electricity standard (though the Senate didn’t pass it). Democratic leaders set an example for the nation with a plan to green the U.S. Capitol.
But for many enviros, the legacy of the 110th Congress will be its failure to renew the 27-year-old moratorium on drilling for oil and gas on the outer continental shelf (OCS) — one of the largest concessions on environmental protection in decades.
Republican leaders and former elected officials like Newt Gingrich spent the summer of 2008 demanding that the country “drill here, drill now.” In the waning hours of Congress, they finally got at least a partial win on the issue: The moratorium expired on Oct. 1, opening more than 600 million acres of coastal waters to leasing and potentially allowing oil and gas drilling as close as three miles to shore. The expiration clearly demonstrated the persistent power of the fossil-fuel lobby in Washington.
“This is the biggest reversal of conservation and protection in the history of this country,” said Richard Charter, a government relations consultant for Defenders of Wildlife Action Fund and a long-time opponent of offshore drilling. “This could be just the first step to losing what people in this country who are now alive took for granted as they were growing up … If anything is going to be fair game to be destroyed in the quest for oil, then this is probably not the end. This is probably just the first step.”
For the moratorium on offshore drilling to expire under a Democratic Congress might strike some observers as ironic, given the party’s longtime ties to various environmental groups. But that would overlook the fact that the moratorium has for decades had backing from both sides of the aisle, with particularly vocal support from Republican leaders in key states like Florida and California.
“The moratorium has always been a bipartisan product, and could not have survived as many years as it did without Republican support,” Charter said.
But that all changed when the price of oil went soaring.
“It’s safe to say the whole country went crazy when gas hit $4 a gallon,” said Athan Manuel, Sierra Club public lands program director. “At that point you saw people across the country calling for immediate action. Congress tried to do everything they could on energy — do more efficiency, do more renewables, do more nukes, and do more drilling. Whether it was the right solution or not, people just started calling for action, and you saw people like Newt Gingrich and the Republican leadership really exploiting that.”
The nearly three-decades-old bipartisan coalition built to support the moratorium was simply no match for oil selling during the peak summer months at well over $100 a barrel, say enviros.
“People vote with their right foot, on the gas pedal,” Charter said. “There is no more powerful lobbying tool, in the environmental movement or anywhere else, than that little dial spinning around on a gas pump.”
A captive audience
Representatives of the oil industry, who have long campaigned for the end of the OCS moratorium, confirmed that it was the high price of gasoline this year that helped them finally get their wish.
“I think that people were listening this summer when they saw gas prices going higher, so that had a lot to do with the public sentiment,” said Denise McCourt, industry relations director for the American Petroleum Institute. “We’re pleased to see that, because people are recognizing that we have some tremendous opportunities out here and that Congress needed to act.”
McCourt said API ramped up its advertising and outreach campaigns on the issue, in part because the high price of gasoline had more people tuned in on the issue.
Lee Fuller, vice president of government relations for the Independent Petroleum Association of America, said national security concerns also helped change public opinion on drilling, but high prices were the main factor.
“We were looking at the impacts of the price of oil moving U.S. money into the hands of foreign countries, which in many cases weren’t that supportive of the United States,” said Fuller — echoing a point made by both Barack Obama and John McCain during the presidential campaign. But Fuller said it was the spike in oil prices that “drove energy into the front line debate” for much of the summer.
Even though new offshore drilling wouldn’t lower prices for at least a decade, according to everyone from the Energy Information Administration to API, the oil industry and its friends in Congress were able to convince the American public otherwise. Through expanded marketing tactics and sheer repetition, they drove home the notion that drilling could be done in a “safe, environmentally friendly” way, and gave the impression that it would only be “deep-sea” drilling — far from the public’s favorite beaches.
In the first six months of 2008, Big Oil spent $289.6 million on political contributions, lobbying expenditures, and paid media, according to a recent report [PDF] from the campaign finance watchdog group Public Campaign Action Fund. The Center for Responsive Politics reports that Gingrich’s 527 group, American Solutions for Winning the Future, has on its own spent $15.6 million this year, most of it on pushing the “drill here, drill now” message.
“Big Oil has just been able to wage a major effort to convince both the public and decision makers that there’s merit to drilling,” said Margie Alt, executive director of Environment America.
The P.R. effort had an impact, as the summer saw growing public demand for drilling, which in turn put pressure on lawmakers to do something. The demand for drilling came despite the fact that, according to other survey data, there is far more public support for investing in renewable energy sources as a way to bring down energy prices.
And as poll numbers in favor of drilling crept up, so did congressional support, even among lawmakers who recognize that it isn’t a real solution to energy concerns.
“I don’t think the [congressional] leadership was as strong as they should have been,” said Corry Westbrook, legislative director for the National Wildlife Federation. “I don’t think they were good about messaging and getting out to the public that there is a better solution than drilling.”
A long time coming
The demise of the moratorium on offshore drilling didn’t happen suddenly. It has had opponents throughout its history, and the legislation to support its continuation, which usually came as part of the regular Interior Department spending legislation, was seeing its support in the key appropriations committees slide year after year.
But it was John McCain who kick-started this year’s big political debate over the issue. For years he had supported the federal OCS drilling ban, but in June he reversed course and called for lifting it. President Bush quickly jumped on board, calling on Congress to lift its ban and then repealing the executive ban, which had originally been imposed by his father in 1990. In order for drilling to proceed, both the congressional and executive bans needed to be ended.
While the drilling debate was still raging in Congress, the Bush administration started putting together a new five-year plan that would allow OCS lease sales as soon as 2010.
“Areas that were considered too expensive to develop a year ago are no longer necessarily out of reach based on improvements to technology and safety,” Interior Secretary Dirk Kempthorne said in July. “The American people and [President Bush] want action and this initiative can accelerate an offshore exploration and development program that can increase production from additional domestic energy resources.”
Though Kempthorne won’t be able to complete the new plan before the end of this administration, he will have set in motion a plan that the next president could carry out.
“It just happened to take almost to the end of the administration, but you know that the White House will get it as far down the runway as they can before they leave,” said Charter.
Green around the gills?
Lawmakers and groups committed to preserving protections for the outer continental shelf were also thwarted by the enormity of the financial crisis that confronted Congress in its final weeks. The House managed to pass an energy bill that included at least some protections for the OCS, but with all attention turned to the Wall Street bailout plan, the protections were never considered in the Senate. Many assume that the Senate wouldn’t have been able to pass them anyway, and Bush made clear he would veto any bill that included them.
But some believe the financial crisis could have given the Democratic leadership some bargaining power to force the president’s hand on a measure to protect the coasts.
“[The Bush administration] came, hat in hand, asking for the $700 billion bailout, so you would presume that Democrats would have some leverage,” said Charter. “I think the reason that the Democrats blinked in this giant game of cataclysmic chicken … is they didn’t want to further complicate the Bush economic crisis.”
Others think the financial crisis simply sucked all the air out of the room in the final weeks of Congress. “With everything else going on in Congress, and with Big Oil putting all their weight behind this idea that we need to drill more, the environmental perspective just wasn’t able to prevail,” said Alt.
Some in Congress fault environmental groups for not doing enough to help keep the moratorium in place. Rep. George Miller (D-Calif.), speaking at a public forum on “The Politics of Green” at the Democratic National Convention in August, accused the environmental community of being “entirely absent” during this summer’s debate over drilling. “Nobody heard from them in their district office, nobody heard from them during that discussion,” said Miller.
Environmentalists, of course, buck at that suggestion, pointing to a litany of advertisements, email campaigns, phone calls, op-eds, and press releases from the summer.
Sierra Club’s Manuel is a bit sick of people asking where enviros were during the heated drilling debate. “I have answered that question millions of times on the Hill,” said. “They asked us why we were so silent. We weren’t. We were yelling like crazy, but we weren’t yelling as loud as the other guys because they had a bigger bullhorn than we did.”
But even if they were drowned out by the oil industry and their allies in Congress, Manuel acknowledged that some things could have been done better this year. He said there is a definite need to reactivate the long-standing coalitions between enviros, tourism organizations, and the fishing industry that have previously stepped up to protect the coasts.
“We just need to do a better job of making those voices louder, because those voices were definitely crowded out,” he said. “We need to get those guys reactivated again. That’s always been an important part of this fight, and we didn’t do as good of a job activating that crowd.”
NWF’s Westbrook also noted that while green groups could have improved their messaging on the OCS issue, they were in fact very active on Capitol Hill over the summer, focusing a lot of their efforts on the Lieberman-Warner Climate Security Act and the seemingly never-ending battle to extend the renewable-energy tax credits.
“Most of the community was very focused on the Climate Security Act, and that is completely tied to investments in more fuel-efficient cars and more fuel-efficient buildings, and getting global warming and carbon dioxide gases down,” said Westbrook. But still, she added, “I wish that we had articulated our message and our concerns more clearly to the public about the fact that [drilling] is just a short-term, and not a real, solution.”
The victors aren’t feeling victorious
While the outcome this year was far from ideal for environmentalists, it wasn’t exactly what Big Oil was asking for either.
The industry wanted a bill explicitly endorsing offshore drilling (like the “All of the Above” bill from the House Republicans), but all it got was a passive expiration of the ban. Drilling advocates wanted a portion of the revenues from leasing to be given to states, in order to give them more incentive to allow drilling off their coasts. They wanted to open up more areas of the Gulf Coast (which are currently protected by legislation separate from the OCS moratorium), and they wanted to include language to significantly limit lawsuits challenging new leasing. Sen. Jim DeMint (R-S.C.) tried to slip these provisions into other legislation in the final hours of Congress, to no avail.
So Oct. 1, though it was dubbed Energy Freedom Day by the pro-drilling contingent, did not represent a dramatic change in energy policy. Instead, it marked a draw on offshore drilling. Drilling supporters will keep pressing their agenda next year, and opponents will push to have the ban reinstated.
“While today we celebrate the offshore drilling ban being lifted, remember there is still a lot more work to be done to move America toward energy independence,” said a post on the American Solutions blog on Oct. 1.
API’s McCourt said the industry needs more assurance that Congress won’t reinstate the moratorium before it can move forward on plans to drill offshore.
“There’s talk about what’s going to happen in 2009, so of course nobody can make any sort of commitment to look for more resources, even to try to look for more resources, unless there’s some kind of long-term assurance from Congress that this moratorium will remain lifted,” she said. “I think we all have to see how this all plays out in 2009.”
Said Charter, “The outcome this year is not an outcome. I think that leaves the issue unresolved and ripe for resolution next year. Even states that were relatively amenable to drilling, this outcome is not something they’re going to want to leave to stand.”
And while some coastal states are more favorable to drilling than others, many are outright opposed, and state legislators, governors, and congressional representatives in those states will use every tool at their disposal to fight it.
Rep. Ed Markey (D-Mass.) has already introduced legislation [PDF] to protect Georges Bank, an area off the Massachusetts coast that may be targeted for new drilling. Other anti-drilling lawmakers are likely to follow suit and try to protect their states’ coastlines.
It’s pretty much inevitable that the offshore drilling debate will resurface early in 2009.
“Congress will revisit the OCS issue in March with a new president,” Drew Hammill, spokesperson for House Speaker Nancy Pelosi (D-Calif.), told Grist. March is when the continuing resolution that’s currently funding the government is set to expire.
“Democrats know that the Republican ‘drill only’ policy will not make our country energy independent,” Hammill said. “The speaker will continue to promote comprehensive energy policies that create green jobs, protect our environment, and make our nation more secure.”
But if environmental champions in the House and Senate are to press aggressively for a renewal of the ban or for other offshore protections, they’ll need to hear stronger support from greens, congressional insiders say. “Congress is going to need a push come March,” said one Democratic aide. “Democrats have lots of great ideas, but they weren’t being heard among the ‘drill here, drill now,’ ‘drill, baby, drill.'”
Enviros say they recognize they’ll need to put out a strong message to both the public and politicians on energy issues — not just lobbying against drilling, but lobbying for better alternatives. “We’ve got to engage the public on our positive message early on in the process,” said Manuel. “Probably the most important thing is to go out and sell the public on what we are for — economy, efficiency, clean energy solutions.”
But the real determining factor on offshore drilling may be the nation’s choice of its next president. John McCain now wholeheartedly supports drilling on the OCS. Barack Obama maintained his opposition for much of the summer, but in August said he’d be “willing to consider” offshore drilling if it could help get a comprehensive and otherwise good energy bill passed. Still, Obama repeatedly stresses that the nation can’t drill its way out of its energy problems.
All of the big green groups that endorse presidential candidates have endorsed Obama: Sierra Club, the League of Conservation Voters, Friends of the Earth Action, Environment America, and Defenders of Wildlife Action Fund.
But if Obama doesn’t win, then what?
“Maybe [McCain will] flip-flop back to where he was before when he understood that drilling wasn’t the solution,” Manuel said. “But it’s hard to assume that would happen with Sarah Palin as his vice president … That would be a terrible step backward for the country on energy policy if it was McCain and Palin in the White House.”