Oil Industry Money Buying Too Much Influence in California

, director, California & Western States | November 3, 2015, 4:35 pm EDT
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It’s been clear to a lot of people for a long time that there’s too much money in politics, and in California the statistics clearly indicate there is too much oil money in politics. Lobbying expenses by oil companies in California reached an astonishing $11 million from July through September of 2015. The third-quarter lobbying expenses paid for an expensive campaign this past summer by Big Oil to derail an oil-reduction provision in California’s ambitious climate legislation, SB 350 (De León and Leno). If that’s not startling enough, the oil industry has spent an eye-popping total of $17.7 million so far this year to influence California energy policies with three months still to go. That annual amount (which is bound to go up even more by year’s end) averages to $147,500 per legislator—a lot more than California’s 120 state senators and assembly members make in their annual salaries. It illustrates the excessive influence that the petroleum industry has over our state lawmakers.

Fracking in CA Inglewood Oil Field

Fracking in California’s Inglewood Oil Field. Photo: LA County

SB 350, signed into law by Governor Brown last month, increases California’s renewable energy requirements to 50% and doubles the state’s energy efficiency. The bill passed handily, with over 60% of the vote in both houses, so it counts as a landmark win for clean energy. Unfortunately, a section that would have directed state regulators to cut petroleum use 50% by 2030 had to be stripped out to pass the bill. It was widely reported that business friendly Democrats, many of whom were beneficiaries of oil company largesse, joined with Republican members to force the oil provisions out. So it’s not surprising to see record-breaking lobbying expenditures during the last stretch of the legislative session by the Western States Petroleum Association and companies including Chevron, Valero and Exxon Mobil.

Unfortunately, money talks, and in this case it spoke very loudly.

A Good Year for Lobbyists, But Not for Big Oil

Unless you are an oil company lobbyist, it has not been the best year to be in the oil business. Third-quarter profit statements last week showed a significant revenue drop for many oil companies due to lower oil prices. The New York Times reported that the oil sector has laid off 200,000 people, and California- based Chevron said it will lay off up to 7,000 workers, or 11% of its workforce, after announcing a 64% drop in profits for the third quarter.

Demand for oil has dropped worldwide, challenging the profitability of the boom in so-called “tight oil” from tar sands to fracking, which tends to be more energy-intensive and expensive to produce. But it’s not just slowing economies in China and the European Union that are causing the oil glut. Demand has leveled off and is declining in the U.S. even as the economy has been growing. In California we are set to reduce our petroleum use by almost 25% even without the oil-reduction target in SB 350. The combination of more efficient vehicles, alternative fuels like electricity and biofuels, and better transportation planning and transit options are having a significant impact on our oil use, and our need for petroleum fuel is decreasing even as our economy is growing. Many analysts see this as a long-term trend, though lower gas prices may increase demand over time.

Time To Rethink?

It’s interesting that just as oil company profits are taking a nosedive, West Coast oil interests are seriously increasing their investment in influencing legislative votes as well as trying to sway public opinion, doubling down on the idea that people should have more and more oil, when we actually are needing it less and less. (For example, oil money is behind the establishment of a website called Powering California, which invites us to view their unintentionally hilarious notion of what “A Day Without Oil” would look like — a sort of “better living through petroleum” idea.)

Imagine if oil companies had used the combined $130 million dollars they’ve spent to influence legislators in the past 10 years on something positive? For example, instead of selling off their clean energy businesses a few years ago, what if they’d chosen to invest more in renewable energy? They might be hiring workers instead of letting them go. Or how about investing in refinery safety, using the money that investigations say was sorely needed to upgrade systems? Perhaps that would have avoided serious accidents at the Chevron plant in Richmond in 2012 and at Exxon’s Torrance refinery this year that caused injuries, pollution, and a spike in gasoline prices.

But for now, it seems that oil companies want to spend their money on politics rather than progress. And all indications are that we can look forward to more of the same on the West Coast in the coming year. The oil industry up to now has not shown that it is serious about addressing climate change, and continues to resist the policies that we need to avoid the worst impacts of global warming. It’s time for Big Oil to pay attention to scientific evidence, consumer trends and other industry leaders who say now is the time to create business models that move us beyond our damaging reliance on fossil fuels to a future of clean energy.

Featured photo by Richard Masoner.

Posted in: Energy, Global Warming, Vehicles

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  • Richard Solomon

    There are two other ways the oil industry has had a huge impact on policy making in Cailf. First, the rules overseeing fracking are very lax at best. Eg, the industry has been dumping billions of gallons of waste from fracking into the ocean for years now. Second, the state has done nothing about trying to at least provide better safeguards against the rail transport of highly volatile Bakken crude oil through the state down south to a refinery in San Luis Obispo.

    It is disingenuous, at best, for Governor Brown to call himself a friend of the environment, let alone a protector of public health, when he does nothing about these two issues.