Crossposted from Greenpeace.
David Koch, one of the richest men in America and owner of the largest private energy company in the United States took to the stage over the Christmas holiday to receive praise for his $2.5 million sponsorship of the American Ballet Theatre's production of the Nutcracker... and a strange thing happened.
The oil tycoon was booed.
John Gapper on the Financial Times Business Blog has the story.
"... there were also boos from near where I sat in the balcony, followed by an angry debate in the row in front of me, with one of the booers declaring “he’s an evil man” and a couple next to her telling her to “shut up” and to leave the theatre. Mr Koch was venturing into the lion’s den in political terms, since Brooklyn is solidly liberal and Democrat, whereas he and his brother are right-wing libertarian and are alleged to have links to the Tea Party movement, which they deny."
"Once Mr Koch had left the stage, the booing stopped and the ballet started."
In our report last year, Koch Industries: Secretly Funding the Climate Denial Machine [PDF], Greenpeace outlined the millions of dollars that the Koch brothers have funneled into ideological and free-market activist organizations that have been fighting for more than a decade to confuse the scientific realities of climate and stall State and federal legislation to curb climate pollution.
The boos are rightfully earned.
According to a recent report [pdf], the U.S. Environmental Protection Agency has overestimated the economic benefits of recycling coal ash by twenty (20) times. The EPA's estimate of $23 billion in annually economic benefit appears to have been based off of flawed methodology, contrasting with the federal government's own data suggesting an actual $1.15 billion annual total. The report was released by the Environmental Integrity Project, Earthjustice and the Stockholm Environment Institute at Tufts University.
As DeSmogBlog and PolluterWatch revealed in late October, lobbyists hired by coal companies and associations spent a full four months lobbying officials from the EPA and the White House Office of Management and Budget to prevent proper regulation of coal ash before the American public was given a formal chance to add its voice. These meetings, which were off-record, may actually have been illegal under the Administrative Procedure Act.
The lobbyists that attended these meetings include Bill Tyndall of Duke Energy, John Pemberton of Southern Company, Anthony Kavanagh of American Electric Power, and Patrick Quinn, who represents several coal clients through his firm, the Accord Group.
...perhaps they had something to do with EPA's drastic miscalculation?
Coal ash slurry, which is a combination of water and materials leftover from the coal combustion process, contains ingredients that can cause cancer and brain damage as well as radioactive elements. The toxic sludge is often stored in open impoundments (huge ponds) or injected into abandoned coal mines, causing major concern over drinking water contamination. Some of these storage ponds have actually broken through their earthen dams, most recently demonstrated by the disastrous 2008 spill at the Tenessee Valley Authority's Kingston facility, which sent over a billion gallons of coal slurry into the community and river system below.
Yet coal ash is still not formally considered "hazardous" by the EPA, and is therefore still less regulated than household garbage.
More can be found at the Charleston Gazette.
Background on the coal industry's lobbying to prevent regulation can be found in DeSmogBlog/PolluterWatch report, Coal-Fired Utilities to American Public: Kiss My Ash [pdf].
The Boston Globe ran a story today on Greenpeace's complaint to the Internal Revenue Service and Massachusetts Office of Campaign & Political Finance calling for an investigation into tax status violations by the Alliance to Protect Nantucket Sound. The Alliance has waged a dirty tricks war against Cape Wind, the nation's first offshore wind farm, since 2001. Today's story follows an article by Pulitzer Prize winning columnist Michael Rezendes in the Globe on Tuesday questioning whether the Alliance had violated the law.
Greenpeace and its supporters have supported the Cape Wind project from the start with field campaigning on the Cape, protests, rallies and petition drives to the Department of Interior to approve the project.
The Alliance ran attack ads against Gov. Deval Patrick about his support for Cape Wind in the run-up to November's election -ads that were clearly over the line electioneering, in clear violation of their non-profit tax free status.
Electioneering, is working for the election or defeat of a candidate. Groups like the Alliance and other 501c3 groups are permitted to take positions on policies but not to back candidates. There are other tax status classes for election work, but the Alliance knows full well it doesn't qualify.
Supporting evidence and references were attached to the letters:
Bill Koch, the other Koch brother, is a founder, Board member and one of the Alliance's principal donors. Koch has used all resources at his disposal to attempt to defeat the Cape Wind Project over the past decade. Oxbow owns coal mines, sells petroleum coke and other products. In addition to founding and funding the Alliance, Bill Koch deployed lobbyists from his company Oxbow Corporation, to lobby against Cape Wind in Washington DC.
From our IRS letter:
Lobbying reports filed with the Clerk of the U.S. House of Representatives and the Secretary of the Senate disclose $600,000 of expenditures made since 2006 by the Oxbow Corporation of which William Koch is the Founder, Owner and President... The lobbying reports reflect that these funds were expended to lobby on legislation relative to "issues surrounding wind energy project in Nantucket Sound" and other related matters. If the Cape Wind development project was not relevant to the business interests of Oxbow Corporation and Mr. Koch, the company would presumably not be expending funds in that area.
The Alliance clearly overstepped the limits of their non-profit tax status. Our letter to the IRS defines the rules:
....50l(c) (3) organizations are absolutely prohibited from directly or indirectly participating in, or intervening in, any political campaign on behalf of or in opposition to any candidate for elective public office. While Section 50l(c) (3) organizations are permitted to take positions generally on public policy issues "section 50l(c)(3) organizations must avoid any issue advocacy that functions as political campaign intervention. Even if a statement does not expressly tell an audience to vote for or against a specific candidate, an organization delivering the statement is at risk of violating the political campaign intervention prohibition if there is any message favoring or opposing a candidate.." IRS Revenue Ruling 2007-41. 2007-25 I.R.B. (June 18, 2007). As the IRS noted, key factors in determining whether the activity is unlawful political campaign intervention includes:
-whether the statement identifies one or more candidates for a given public office;
-whether the statement expresses approval or disapproval for one or more candidates' positions' or actions;
-whether the statement is delivered close in time to the election;
-whether the issue addressed in the communication has been raised as an issue distinguishing candidates for a given office.
Our complaint identifies a specific radio ad run by the Alliance:
The radio ad clearly identified a candidate for the office of Governor. The ad expressed strong disapproval for that candidate's position on the Cape Wind project. The ad was repeatedly aired within days of the statewide election. The Cape Wind project was the subject of much discussion throughout the gubernatorial campaign. In fact, the same gubernatorial candidate who would clearly benefit from the message of the Alliance radio ads consistently published campaign materials touting his opposition to the Cape Wind project, and the fact that his opponent, Governor Patrick, supported the project.
This radio ad cannot in any way be described as the type of nonpartisan activity which is permitted by the Internal Revenue Code and relevant legal authority. Rather, these ads are exactly the type of campaign activity expressly prohibited by the IRC, and relevant rulings. Not only did the Alliance make these expenditures, but it raised funds specifically earmarked for political electioneering activity. At least one of the individuals who funded these radio ads, who is also a member of the Board of Directors of the Alliance, had a leadership role in the campaign of the gubernatorial candidate who would benefit from these expenditures, giving rise to a reasonable inference of coordination between the Alliance and the candidate's campaign.
And the complaint concludes:
We respectfully request that you undertake a comprehensive investigation of the Alliance's activities, contributions and expenditures. If it has engaged in activities in violation of the IRC, we urge that you consider all appropriate fines and penalties, as well as the revocation of the Alliance's tax-exempt status. Such revocation may be the only means to ensure that public tax dollars do not continue to be improperly used by the Alliance to subsidize its various activities and the interests of its donors.
Similar to Rolling Stone's "The Climate Killers" article that was released at the beginning of the year, AlterNet has just profiled some of the most influential political, financial and popular enemies of the Earth's increasingly disrupted climate.
Snide comments aside, both reports nail some of the most influential staples: Koch Industries, an infamous engine of the climate denial machine; Warren Buffet, the filthy-rich investor who has placed his bets on coal; and Joe Barton, Big Fossil's purchased U.S. Representative (over 1.7 million dirty dollars over the last decade).
AlterNet's newer spotlight identifies Harold Lewis and Freeman Dyson, who are similar to the likes of S. Fred Singer and Patrick Michaels in their use of scientific credentials for corporate public relations rather than, say, active climate studies...or scientific study in general. Also like Singer and Michaels, they have ties to prominent denier think tanks such as Cato, the Heartland Institute, and the Competitive Enterprise Institute, all of which are currently or formerly funded by Koch Industries and ExxonMobil. Similarly, AlterNet mentions Anthony Watts, whose skeptic blog is the go-to hub for climate-solutions obstructionism, and whose credentials as a TV weatherman (not certified by the American Meteorological Society) fool people into thinking he's a climate expert. Like the other junk scientists mentioned in the article, Watts has ties to the Heartland Institute.
In a contrasting look at university integrity, AlterNet also profiles Ken Cuccinelli, Virginia's attorney general who has used the "climategate" nonscandal as grounds to continue harassing Michael Mann, the influential University of Virginia climatologist whose university research was a primary target of the hacked East Anglia emails. While Mann was defended by his university and cleared of wrongdoing after investigations, the same can't be said for George Mason University's Edward Wegman. AlterNet points out that Wegman is currently under formal investigation his George Mason for pushing bogus climate material for none other than Texas Rep. Joe Barton.
It is worth noting that George Mason University (GMU) is a known breeding ground for climate deniers and heavily supported by the Koch brothers; both the Mercatus Center and the Institute for Humane Studies (IHS) operate out of the University have received millions of dollars from the Kochs. There's also Koch Industries executive Richard Fink, who taught and filled various other positions at GMU, co-founded and directs GMU's Mercatus Center, directs the Institute for Humane Studies, is the president of two Koch family foundations that fund these groups, founded the Citizens for a Sound Economy Foundation (which became the Americans for Prosperity Foundation, of which Fink is a director)...Rich Fink pretty much lives up to his name.
Glenn Beck (who attended Charles Koch's secret election strategy meeting last June), Mitch McConnell, former BP CEO Tony Hayward, Peabody CEO Gregory Boyce, and others are also credited for their dirty work in the full article.
Check Greenpeace.org for more Koch Facts.
UPDATE 4/13/2012: The Indianapolis Star's John Russel has compiled a full timeline of this scandal: Prying Open the Duke Energy Scandal
Duke Energy is experiencing the departure of its second-top executive (after CEO Jim Rogers), utilities division president James Turner, making Turner the third Duke casualty in an ethics scandal that has already led to the firing of two other Duke officers and an Indiana state utility regulator.
Emails between Turner and David Lott Hardy, the recently-sacked chairman of the Indiana Utility Regulatory Commission (IURC), revealed that the two men had a particularly cordial relationship that extended itself into professional circumstances. As Duke negotiated positions for Michael Reed (coming from the state's Department of Transportation and with three years of experience in the IURC) and Scott Storms (an administrative law judge and general counsel for the IURC), Turner and Hardy frequently discussed the hiring process. The Indianapolis Star revealed that in one message to Turner, Hardy encouraged the executive to hire Reed, asking, "Is this decision yours and I don't need to sell Jim [Rogers, Duke CEO], or is his buy-in pivotal?"
In order to avoid honoring a customary yearlong pause before moving from the IURC to Duke, Storms was given an express pass through the IURC's ethics panel investigation with help from Reed and Hardy. Reed, concerned that Storms would not get the panel's go-ahead, urged Hardy to enlist the help of the IURC's ethics officer, Loraine Seyfried, who then wrote a memo to Storms denying any conflict of interest. The ethics panel mirrored Seyfried's conclusion and allowed Storms to move to Duke; Seyfried got his old job as administrative law judge. Reed and Storms were both fired in November, just before emails revealed the full extent of the scandal. While Seyfried was not fired along with Hardy, she was removed from cases involving Duke.
What made the Duke-IURC revolving door particularly improper was Scott Storms' role as a judge presiding over Duke cases while arranging to work for the utility giant. Chairman Hardy, Storms' boss, ignored the clear conflict of interest, which included Storms' approval of a utility ratepayer hike in order to cover massive cost overruns of Duke's new Edwardsport coal plant.
The new Edwardsport plant, which is intended to both replace an existing facility built in the 1940s and to demonstrate integrated gasification combined cycle (IGCC) technology, has swelled in costs originally estimated at $1.5 billion to just under $3 billion. The difference in costs will be reflected in the estimated 16% ratepayer increase that Storms approved before joining Duke. Indiana's Citizens Action Coalition, which has been a strong voice of opposition to the Edwardsport plant, warns that other hidden expenses will likely wind up in utility bills as well.
The debacle's most recently disgraced figure, James Turner, boasted Duke's second highest annual compensation--$4.3 million--after CEO Jim Rogers ($6.9 million). The Indianapolis Star insinuated that part of Turner's "incentive pay" (last year an almost $800,000 portion of his total compensation) could have been a result of the very revolving door relationships that forced him out of the company. While we can hope the lesson in this case is "don't cheat the system," industry sentiment is much more likely to be, "don't get caught like Duke did."
Important to consider is how similar scandals could be possible on the federal level. Duke has a total of five lobbyists with former experience in the U.S. Environmental Protection Agency, including Bill Tyndall, who was announced as one of the individuals reporting directly to Jim Rogers following Turner's departure.
David Lott Hardy: "Don't tell the utilities I'm being accommodating -- bad for my reputation."
James Turner: "Don't worry. Your reputation in this regard is unalterable."
The infamous Don Blankenship, CEO of Massey Energy Company, has announced he will retire at the end of December. Given the storms Blankenship had weathered in the past, it came as somewhat of a surprise that the climate change denying, union busting, federal judge bribing, safety law violating, mountain top destroyer is finally calling it quits.
His decision to leave was likely at the behest of the Massey board, which has announced its intention to sell the company. Blankenship had always been an obstacle to the sale, publicly decrying the idea by comparing Massey to a “broken down truck” in need of fixing before being put on the market.
As the face of Massey Energy, Blankenship also posed a serious public relations obstacle to any potential sale. Recently called the “Dark Lord of Coal Country” by the Rolling Stone Magazine, he was a ripe target for those wishing to draw attention to the death and destruction caused by an unapologetic coal industry.
The embattled CEO is also facing growing legal trouble of his own due to the Upper Big Branch mine explosion. A judge in West Virginia declined to throw out two separate lawsuits that hold Blankenship personally responsible for the disaster. Two women widowed by the UBB explosion filed the lawsuits, which Blankenship hoped would be dismissed. The judge’s decision was announced shortly before Blankenship made public his departure, adding to speculation that he had become a public relations hindrance to Massey’s sale.
Investors have agreed wholeheartedly with the change in leadership, sending Massey’s stock soaring after news of Blankenship’s retirement.
It is important to remember that as influential as Blankenship was, it is the Massey Energy Company that is ultimately responsible for it’s multiple mining disasters. Blankenship has been an obvious figurehead for what is wrong with Massey and the coal industry culture at large, but his departure should not distract attention from the fact that coal companies want coal, and they do not care about the environmental and human costs endemic to its extraction.
Massey CEO Don Blankenship, West Virginia's strip mining overlord, faces two lawsuits that hold him personally responsible for the Upper Big Branch coal mining disaster which killed 29 men. A Judge in west Virginia ruled that two separate lawsuits, brought by two women widowed by Massey's UBB mine, will not be dismissed as Blankenship had hoped.
Blankenship is accused of being “willfully negligent” in his direction of the company subsidiaries operating the mine, which violated a host of federal and state safety regulations prior to the explosion.
For more see the Bloomberg News article by Chris Stratton and Margaret Cronin Fisk.
In a twisted case of actualized déjà vu, Chevron spilled 100 barrels of oil into the Red Butte Creek area of Salt Lake City, narrowly missing the waterways...
...waterways that were gifted about 800 barrels of spilled crude from the exact same pipeline last June. The community is still busy cleaning up the first mess, and Mayor Ralph Becker has expressed his own "outrage." While Mayor Becker has supposedly been a bit soft with Chevron even since June's spill, he has now explicitly stated what people around the world realize: "We cannot trust Chevron."
Chevron recently paid over $400,000 for the June spill--a negligable fee compared to their $13.7 billion profit since quarter three of 2010. The new spill took place a mere 100 yards from June's disaster, stopping just 50 feet short of Red Butte Creek.
For a barrage of ironic and contradictory statements from one of Chevron's representatives, check out the Salt Lake Tribune article covering the [new] spill.
(Photo courtesy of the Salt Lake Tribune)
XTO Energy, a subsidiary of Exxon Mobil, is under investigation by the Pennsylvania Department of Environmental Protection (DEP) after a 13,000 gallon hydraulic fracturing fluid spill at XTO Energy's natural gas drilling site in Penn Township, Lycoming County, PA.
The spill was first discovered last week by a DEP inspector who found a valve had been left open on a 21,000-gallon fracking fluid tank, discharging fluid off the well pad into local waterways, threatening a nearby cattle herd that had to be fenced off from the contaminated pasture. Exxon/XTO has not provided an explanation on why the valve was left open.
“This spill was initially estimated at more than 13,000 gallons by the company and has polluted an unnamed tributary to Sugar Run and a spring,” said DEP Northcentral Regional Director Nels Taber. “There are also two private drinking water wells in the vicinity that will be sampled for possible impacts.”
DEP's sampling confirmed elevated levels of conductivity and salinity in the spring and unnamed tributary, clear indications that the fracking fluid was present in the waterways.
Exxon paid $30 billion in its June 2010 merger with Texas-based XTO Energy, making Exxon/XTO the largest natural gas producer in the United States, with extensive holdings of "unconventional resources" throughout the Marcellus Shale and elsewhere.
Concerns over natural gas fracking are widespread through the Marcellus Shale region and in several Western U.S. states where a boom in natural gas development is underway thanks to the controversial hydraulic fracturing technique. Residents living near fracking operations are on the front lines as their drinking water supplies and health are threatened by the fracking process, which involves injecting a mixture of sand, water and undisclosed toxic chemicals into the shale rock to free up the trapped gas.
Pennsylvania is no stranger to fracking disasters, notably the high-profile contamination in the town of Dimock, where resident Norma Fiorentino's water well famously blew up on New Year's Day 2009, and at least 15 families have had their drinking water ruined by fracking, leading to illness, livestock deaths and other maladies.
Last week, the Pittsburgh City Council banned natural gas fracking within city limits due to concerns over the threat of water contamination and public health risks.
But Pennsylvania is hardly alone in the fracking fight. Fracking operations have contaminated water supplies across America from New York, to Wyoming, to New Mexico, to Ohio, to Virginia, to Arkansas, to Colorado and beyond.
The Environmental Protection Agency currently has no power to regulate hydraulic fracturing thanks to the Halliburton Loophole inserted into the 2005 enegy bill at the behest of former Vice President Dick Cheney, the former head of Halliburton.
Mounting evidence of the fracking threat nationwide has yet to convince lawmakers to close the loophole and hold the natural gas industry accountable for its fracking messes. As the New York Times asked in a November 2009 editorial, "if hydraulic fracturing is as safe as the industry says it is, why should it fear regulation?"
Massey Energy recently released a new report claiming the company’s safety practices were not to blame for the Upper Big Branch mining disaster that killed 29 people. Massey Energy’s chief executive Don Blankenship maintains the explosion was caused by natural occurrences and not from unsafe coal mining and ventilation procedures. He says the report "illustrates that it's something unusual, that it's more likely than not that it came out of the floor… and not out of the natural mining process,” refuting the widely held theory that the deadly explosion was due to the willful disabling of methane detectors.
The report, authored by Massey “experts,” is the company’s latest contrivance in their campaign to discredit and obstruct government investigations into the disaster. Other elements of their strategy have included physically keeping investigators from inspecting machinery at the mine, preventing top safety officials from testifying, and publicly accusing the state and federal governments of lying. Because of Massey’s repeated attempts to sabotage the investigation, MSHA officials have threatened to seize the mine, an extreme action that illustrates the level of hostility felt by investigators.
Avoiding or reducing their liability is of utmost importance to Massey Energy executives, who have announced they were considering all offers for a buy out. The company has not hit its production targets since 2004, has suffered multiple deadly disasters related to poor safety practices, and posted a net loss of $41.4 million last quarter. Given the fact that any company that buys Massey would be liable for the damages wrought at UBB, company executives have little chance of pawning their problems off on a buyer if the MSHA finds Massey at fault for the UBB explosion. This means that Massey execs are frantically trying to limit their responsibility for UBB, or at least prolong the investigation long enough to sell the company before the roof falls in on their heads.