Editorial: Iowa biofuel giant loves Oregon motorists … and secrecy
Published 12:00 am Wednesday, November 28, 2018
- 123RF
When legislators decided in 2015 to remove the sunset date on Oregon’s Clean Fuels Program, they heard plenty about its supposed benefits. By reducing the “carbon intensity” of road fuels by 10 percent, they were told, the program would help ameliorate climate change. Meanwhile, supporters argued, it would produce jobs in Oregon. Lots of jobs.
Jana Gastellum, the Oregon Environmental Council’s program director for climate protection, assured lawmakers that the program would create “opportunities for Oregon-based clean fuels development, which will create jobs, economic development and add to the tax base.”
Graham Noyes, acting executive director of the Low Carbon Fuels Coalition, predicted “the expansion of in-state production of low carbon fuels.” He cited a study that claimed the Clean Fuels Program “could provide as many as 29,000 Oregon jobs” by, among other things, “keeping billions of dollars currently spent on imported petroleum fuel in-state through the production of clean fuel production capacity.”
At least some of this local economic benefit surely has been realized or will be. The long list of low-carbon fuel providers registered with the Clean Fuels Program contains some in Oregon, including SeQuential Pacific Biodiesel.
Isn’t it interesting, though, that the first, and so far only, biofuel company to piggyback on a November lawsuit opposing the release of public records generated under the fuel program hails from the Midwest? Iowa-based Renewable Energy Group Inc. touts itself in its court filings as “the leading provider of cleaner, lower carbon intensity products and services in North America.” The company has joined a lawsuit brought by Chevron U.S.A. that seeks to hide from Oregonians the activities of companies buying and selling fuel credits on the state market.
Without knowing which companies are buying and selling credits, and for how much, Oregonians and legislators have no way to know who’s pocketing subsidies under the Clean Fuels Program. Such information would help the people who pay for the program gauge its effectiveness as a state economic development engine.
The program requires road-fuel importers like Chevron to reduce the carbon intensity of their products by 10 percent over a decade. Because blending with lower-carbon fuels eventually ceases to become practical, importers eventually generate carbon deficits they may offset by purchasing credits generated by clean-fuel producers like Renewable Energy Group. Since the program went fully into effect in 2016, more than $22 million worth of credits have been bought and sold secretly on the state’s market.
We asked the Department of Environmental Quality, which oversees the fuel program, to release records showing which companies have bought and sold credits, how many they’ve bought and sold, and for what price. DEQ declined our request, but the Oregon Department of Justice found in our favor on appeal. Chevron U.S.A. promptly sued DEQ, DOJ and, for good measure, the Bulletin editor who’d requested the documents. ’Cause, you know, why not?
Renewable Energy Group soon joined the secrecy crusade, as is its right. But as the parties’ motions and legal bills pile up, so do the questions lawmakers and members of the public should be asking. Why, for instance, does an Iowa-based biofuel behemoth not want anyone to see the inner workings of the state credit market?
One possibility is this: Some of the subsidies Oregonians provide through higher fuel prices are going to Oregon-based companies, but a surprising — and, perhaps, shocking — share is being shipped off to Ames, Iowa. So much for those Oregon jobs.
Never fear, though. The Clean Fuels Program seems to be providing an indirect jolt to at least some businesses. These are the law firms whose attorneys serve as foot soldiers in the fuel industry’s campaign against government transparency and the journalists who pursue it.