Hal Shepherd – Page 2 – Water Policy Consulting LLC

Ten Tribes Partnership Takes a Seat at the Table for Colorado River Management

The Colorado River basin is home to 26 federally recognized tribes in seven western states. Despite their long-standing rights to about 20% of the water that flows through the Colorado, many tribes are excluded from water management decisions and don’t benefit from basic water infrastructure and a secure supply of clean, safe water. The Ten Tribes Partnership is taking a seat at the decision-making table by building capacity among tribes to claim their right to water, establishing water leases, and helping restore the river’s health. Drawing upon a spiritual mandate to “ensure that this sacred water will always be protected and available” the tribes are working to “advance sustainable water management through collaborative decision-making.”

There are alternatives to sacrificing the Arctic National Wildlife Refuge’s coastal plain

The Trump administration recently gave the final go-ahead to drilling in the Arctic National Wildlife Refuge, which by the end of 2020 would authorize the sale of two separate 400,000-acre oil and gas leases, encompassing a major portion of the refuge’s coastal plain and 8 percent of the 19.3 million-acre Refuge.

Opponents who have filed multiple lawsuits to stop the leasing, believe that the approval process was rushed for political reasons resulting in a flawed and inadequate analysis of the environmental impacts, violating prohibitions on killing or harassing of polar bears and laws requiring the protection of indigenous subsistence resources as well as exacerbate sea level rise, extreme weather events, the spread of diseases like and other impacts of climate change.

Alaska’s political leadership, on the other hand, seems unfazed by yet another botched Trump administration environmental analysis and the fact that more drilling in the Arctic will contribute to Alaska’s carbon footprint. Sen. Lisa Murkowski, for example, said “[t]his is a capstone moment in our decades-long push to allow for the responsible development of a small part of Alaska’s 1002 Area. … I’m confident the ROD has been developed carefully and comprehensively and look forward to the lease sales mandated by law…”

Why are our political leaders still stepping in line with President Trump’s insatiable thirst for oil no matter what the environmental cost, when economists have been warning for decades that the state is too dependent on the oil and gas industry to bail it out from spending at an unsustainable rate year after year?

It should have been obvious in the mid-1980s when global oil prices crashed sending the state into a full recession, that not only were the days of the oil and gas fueling fiscal growth over, but continuing to put all the state’s eggs in one basket would actually harm the economy. That the ongoing sugar-daddy delusion was still alive and well by 2003, however, is illustrated by then-Gov. Frank Murkowski’s announcement regarding the solution to the state’s economic crises: “Ladies and gentlemen, in a single word, it’s oil.”

Today the state’s addiction to oil is partly illustrated by the millions it provides via annual tax write-offs to oil and gas corporations who drill in Alaska but do not provide much in the way of return on this investment. in 2014, for example, the state’s largest producer, ConocoPhillips, made 68 percent of its global profits from Alaska but invested only 15 percent of its global capital in the state.

Despite the delusion of some politicians that drilling in places like ANWR could take Alaska back to the days of economic Nirvana of Prudhoe Bay, one thing that could prevent development in ANWR would be if presidential candidate Joe Biden who, if elected, has promised to “permanently protect” the refuge.

But in the end, rather than politics or litigation, it is simple economics that could stop drilling in the coastal plain. Ever sense COVID-19 — which came at a time when oil prices were already down — drove those prices to historic lows, the industry as a whole has been bleeding money, shedding jobs, and interest in drilling in the remote sites with difficult conditions, such as the Arctic refuge, may be waning.

More importantly, while oil companies are making cutbacks in drilling programs, banks
are less inclined to front them capital on future investments resulting in a vicious cycle of less funding available for future drilling. This situation has been further exacerbated by the
declaration from several global banks that they will stop financing oil and gas exploration in the Arctic due to the need to move away from fossil fuels and invest in alternative energy sources because of the rapidly increasing impacts of climate change on communities and ecosystems in the Arctic.

The good news is that with the banks turning away from fossil fuel investments while they decide what kind of energy programs could benefit from COVID-19 stimulus funding, there may not be a better chance than right now to move towards green energy. Fossils fuels have become no more than an economic dinosaur and a carbon-producing disaster, especially for the Arctic.

So, rather than sacrificing the coastal plain and Alaska’s fiscal future, why not investigate the potential local and global economic impact of renewable energy in the Arctic, including solar, and hydro and wind power as part of Alaska’s financial recovery?

This Op-ed also appeared in the September 24, 2020 edition of Arctic Today.

Trump Would Like You to Think He’s Gone Environmental

Just weeks away from the Presidential election, Trump is pandering for votes by suggesting that he is our man when it comes to preserving the environment. Describing himself as “the number one environmental president since Teddy Roosevelt,” in recent weeks he has backtracked on his administration’s move to grant a permit for Pebble Mine in Alaska which has to potential to devastate Bristol Bay salmon runs, and extended a federal moratorium on offshore drilling in the Gulf of Mexico which is largely supported by residents of Florida, Georgia and South Carolina where he is trying to solidify his base. Moreover, he rescinded his nomination of William Perry Pendley, the controversial candidate chosen to run the Bureau of Land Management. This smokescreen does little to obscure the dozens of deregulatory actions undertaken by the Trump administration, including rolling back fuel economy standards, opening the Arctic National Wildlife Refuge coastal plains to oil leasing, and tougher air-quality standards to name but a few.

Lawsuits Filed on ANWR

Three lawsuits have been filed seeking to block the Trump administration’s efforts to sell oil leases in the Arctic National Wildlife Refuge. The National Audubon Society, Natural Resources Defense Council, Friends of the Earth, and Center for Biological Diversity have signed off on a lawsuit sighting insufficient concern over increased greenhouse gas emissions and melting permafrost, poor air quality, and negative impacts to the region’s wildlife. The lawsuit alleges violations of the National Environmental Protection Act, the National Wildlife Refuge System Administration Act, and the Endangered Species Act. A second lawsuit, filed by the Gwich’in Steering Committee also sites violations of the Alaska Native Claims Settlement Act, and includes plaintiffs in Canada’s Yukon chapter of Canadian Parks and Wilderness Society. Most recently, a third lawsuit was put forth by fifteen states including California, Connecticut, Delaware, Illinois, Maine, Maryland, Massachusetts, Michigan, Minnesota, New Jersey, New York, Oregon, Rhode Island, Vermont and Washington. Concerns addressed in this lawsuit include habitat damage and greenhouse gas emissions, as well as impacts to waterfowl hunting and a lucrative birdwatching industry for birds that breed on the Arctic plain and overwinter in the lower 48 states.

Department of the Interior Should Take on Climate Change

Public land management agencies have taken a far right turn under the Trump administration, with a strong bent toward energy development and away from their shared mission of protecting lands for the recreational enjoyment of all Americans and, increasingly, as refugia from climate change. The recently proposed appointment of William Perry Pendley as acting director for the U.S. Bureau of Land Management is just the latest attack on federal lands stewardship.

U.S. Senator Tom Udall lamented the disastrous turn the agency’s leadership has taken during a webinar put on in the summer of 2020 by WildEarth Guardians. Referring to the progressive approach to land and species protection under his father, Stewart Udall – who served as Secretary of the Interior under President John F. Kennedy, Udall said, “The Interior Department should be right at the center of climate, endangered ecosystems, taking better care of the land, coming up with a good land ethic and dealing with the diversity issues and the environmental justice issues.” Udall went on to add “The next president is going to want to do something about climate, the Interior Department is going to be at the center of that.”

Trump Puts the Pause on Pebble Mine

A reprieve in the contentious Pebble Mine project came from an unlikely source, when President Trump paused the permitting process for the gold, copper, and molybdenum mine in Southwestern Alaska after previously backing the project. Located in the headwaters of the lucrative Bristol Bay sockeye salmon fishery, the project is slated to include the largest earthen dam ever built, despite being located in a seismically active region. The 20 square-mile pit mine would require roads and a gas pipeline through pristine wilderness near Lake Iliamna and Lake Clark. Brown bears, wolves, moose, caribou, waterfowl, and all five species of Pacific salmon, along with some 7,500 people, mostly traditional Natives, live in the region likely to be most impacted by the mine.

Trump is calling for additional information from the Pebble Limited Partnership about environmental mitigation from the degradation caused by the project. In a letter to the Partnership, the Corps listed new requirements that would need to occur in order to mitigate the impacts of Pebble to the Bristol Bay ecosystem including compensation for impacts on 2,825 acres of open water and 129.5 stream miles within the Koktuli River watershed and on 460 acres of wetlands, 231 acres of open water and 55 stream miles along the transportation corridor and port sites. The agency gave the partnership 90 days to update their plan to address these impacts. This sudden about-face appears to have been prompted by statements made by Trumps eldest son, an avid fisherman who has fished in the region, as well as other influential Republicans who have Trumps ear.

Arctic Refuge Oil Leasing Approved, Now Come the Legal Battles

Under the Trump administration, the 1.5 million-acre arctic plain on the northern edge of the Arctic National Wildlife Refuge is now open for drilling. Next up, a call for oil lease sale nominations and industry and public comment of at least 30 days, followed by a notice of the lease sale.

Home to imperiled polar bears, the vast and far-ranging Porcupine Caribou herd, countless nesting birds, and the Gwich’in Indian Nation, this is America’s last great wilderness. After a forty-year battle to prevent oil extraction on the refuge, the announcement was a blow, but that may not be the end for this pristine ecosystem.

Opponents believe that the process for approval of drilling was rushed for political reasons resulting in a flawed and inadequate analysis of the environmental impacts in violation of the National Environmental Policy Act. In addition, they claim the approval is contrary to prohibitions on killing or harassing of polar bears under the Endangered Species Act and Marine Mammal Protection Act, and the protection of indigenous subsistence food-gathering rights under the Alaska National Interest Lands Conservation Act. Vast lakes, rivers and wetlands could be affected by drilling in the Coastal Plain through water quality impacts and mining and road building related to needed infrastructure.

Similarly, the Gwich’in Steering Committee which represents members of the Gwich’n Athabascan tribes located on both sides of the Canadian/Alaskan boarder, argues that approval of drilling violates a 1987 treaty that gives the Canadian Government oversight authority into the management of the Porcupine Caribou herd. According to Arctic Today, Steering Committee Executive Director Bernadette Demientieff the “administration has done nothing but disrespect the Indigenous peoples that have occupied these lands. Our ways of life, our food security, and our identity is not up for negotiation. The fight is not over…”^[1]

Due to the impacts of COVID-19 resulting in less transportation, which in-turned caused a drop in oil processes, oil and gas companies’ interest in drilling in remote and difficult conditions of Arctic Plain has been waning. So it remains to be see whether there will be any bids submitted on the leases. Moreover, oil-tax initiative on the ballet in Alaska in November, Ballot Measure 1 would impose a 10 percent base tax on production form large North Slope oil fields and eliminate production tax credits. And finally, major banks, Goldman Sachs, JPMorgan Chase, Citigroup and Wells Fargo, have declared that they will not finance any development in the refuge. So the fights to save the Arctic Coastal Plain is not over yet.

Winners and Losers Among Northern Fish as Climates Change

A recent Canadian study, undertaken by York University and the University of Saskatchewan, studied climate resilience among northern fish species with some surprising results. Northern fish are, by nature, remarkably resilient, adjusting to a range of conditions including short summers with 24-hours of daylight and abundant food followed by long dark winters with little or no food availability. But as streams warm, prompting an increase in the invertebrates on which salmon feed, salmon species are tending to grow faster and have greater reproductive success. That’s the surprise, and could be a boon to indigenous communities, especially as salmon expand their ranges further north. But for some fish, mainly dolly Varden and Arctic grayling, which are specialized to thrive in cold Arctic waters, there may be no adaption or migration option at hand as rivers warm and summers grow longer.

Opinion – Alaska Faces an Economic Year Like no Other

Jessica Shepherd

Back in late March, when Alaska was reporting its first spate of Covid-19 cases, Reuters published a synopsis of the state’s economy. In the article Alaska State Senator Natasha von Imhof, co-chair of the Senate Finance Committee, was quoted as having said, “We are being hit on all sides with the stock market crash, oil prices plummeting and the tourism and fishing season all but idle.” To see the original article see here.

Now, nearly six months later, we wondered how Alaska was faring based on the parameters von Imhof used to measure the state’s economic resiliency. Following is an assessment of the oil industry, the Alaska Permanent Fund, tourism, and the seafood industry for mid-August. The picture is grim, but perhaps not as dire as it looked back in March.

On March 23^rd, due to a Covid-induced stall-out in all things travel-related, oil prices plummeted from a high of $69 a barrel at the first of the year to just $23 a barrel. This equated to an overnight loss to Alaska’s treasury of some $500 to $700 million dollars. Given that the industry break-even cost of production is $39 a barrel, it was cheaper to leave oil in the ground. But the worst was ahead of us. In late April oil briefly dropped to below zero due to a glut on the market. In response, ConocoPhillips, Alaska’s biggest oil producer, announced plans to reduce production by 2,000 barrels per day and institute layoffs for 250 staff. This was followed shortly thereafter by Doyon’s announcement of 300 layoffs. As we all know, oil drives Alaska’s economic engine. As of this writing, on August 10^th, oil is back up to $45 a barrel. Still well below the price at the beginning of the year, but significantly better than the March-April outlook.

Then there was the stock market dive, which sent the Permanent Fund in a tailspin. In two weeks, the fund declined by 10% to a value of $58.7 billion. Today, even after paying out a $992 dividend in July to all eligible Alaskans, the fund is back up to $64.7 billion. The stock market, which has been oddly resilient during the pandemic, has, to date, spared the fund from a sustained loss.

The tourist season was all but on hold in the spring as cruise ship companies canceled summer sailings and Canada closed the boarder to independent travelers. As a result, it’s been a quiet summer in Alaska’s tourist destinations. Restaurants remain closed or subsist on a subdued cliental of locals and in-state travelers. Alaska’s usually clogged highways are pleasantly uncongested, and towns like Cooper Landing, Telkeetna, and Skagway are eerily quiet. And the skies over communities like Homer are oddly still now that RavnAir has folded. There’s something to be said for uncrowded sidewalks and ample parking at the grocery store, but the loss in tourist dollars has many small business owners spooked. Even with relief funding and small business loans, places like the Alaska SeaLife Center in Seward, the Egan Center in Anchorage, and Chena Hot Springs Resort outside of Fairbanks, along with hundreds of bed and breakfasts, hotels, restaurants and shops have laid off staff and cut expenses to the bone, and they still aren’t making ends meet. Recovery, when it comes, will take a long time, and many of our favorite small businesses may no longer be there.

Finally, the seafood industry, which, as the second largest revenue stream in the state, contributes 5.2 billion dollars to the economy annually, faced a shortage of processing plant workers early in the season due to travel restrictions placed on the non-U.S. citizens who make up a large percent of seasonal workers. Citing concerns about Covid-spread among small, medically-underserved villages, local lawmakers in the Bristol Bay region went so far as to ask the governor to cancel the fishing season this year. In response, the state mandated a 14-day quarantine for out-of-state workers, and still, cases erupted aboard fishing vessels and at processing plants in Cordova, Whittier, Seward and Kodiak. In fact, the majority of non-residential cases in Alaska have been among seafood workers. Read more about Alaska’s fishing industry and Covid-19 cases here. Salmon runs in Bristol Bay were respectable, but the initial price came in at just 60 cents a pound, compared to $1.54 last year. And in Kodiak, Prince William Sound and Cook inlet sockeye runs were disappointing. Read more about Alaska’s 2020 salmon harvest here.

One indicator von Imhof did not take into account during her March economic assessment pertains to the state’s population. Alaska’s population has decreased for three consecutive years, declining from an all-time high of 741,456 on July 1 2016, to 731,545 on July 1, 2019. Figures for 2020 will come out later this month, but given the downturn in oil revenue and jobs, tourism, and, to a lesser degree, in fisheries, it’s likely the downward trajectory will continue.

So what do we make of this information? Alaska has ridden out the first six months of the Covid-19 pandemic a little better than expected, thanks to the whims of the stock market and oil prices. Unfortunately, the private sector hasn’t fared as well, and as we approach the fall and winter with no further federal support in sight, the difficulty of keeping small businesses afloat until next year may be prove to be too much for many shops, restaurants and other service industries. They will only survive to the degree that we, as consumers, support local businesses rather than relying on Amazon.com and Walmart. Please think on that the next time you shop.

House Democrats Deliver an Ambitious Climate Action Plan

In mid-June, U.S. House Democrats released a comprehensive 538-page climate crisis action plan. The goal of the plan is to bring U.S. greenhouse gas emissions to zero by 2050. The plan is built on the following 12 pillars:

Invest in Infrastructure to Build a Just, Equitable, and Resilient Clean Energy Economy
Drive Innovation and Deployment of Clean Energy and Deep Decarbonization Technologies
Transform U.S. Industry and Expand Domestic Manufacturing of Clean Energy and Zero-Emission Technologies
Break Down Barriers for Clean Energy Technologies
Invest in America’s Workers and Build a Fairer Economy
Invest in Disproportionately Exposed Communities to Cut Pollution and Advance Environmental Justice
Improve Public Health and Manage Climate Risks to Health Infrastructure
Invest in American Agriculture for Climate Solutions
Make U.S. Communities More Resilient to the Impacts of Climate Change
Protect and Restore America’s Lands, Waters, Ocean, and Wildlife
Confront Climate Risks to America’s National Security and Restore America’s Leadership on the International Stage
Strengthen America’s Core Institutions to Facilitate Climate Action

More specifically, from the perspective of water policy, the plan calls for “Water infrastructure resilience” standards to provide clean water and mitigate flooding, droughts and erosion. The plan also calls for the reduction of water pollution through the safe disposal of hazardous wastes from the oil and gas industry, and a recommendation to protect “at least 30% of all U.S. lands and ocean areas by 2030.”

To view the plan in its entirety, click here. To read more about the development and implementation of the plan click here and here.