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.
Yale Environment 360, MediaStorm and Appalachian Voices have collaborated on a 20-minute documentary titled "Leveling Appalachia: The Legacy of Mountain Top Removal Mining." The cinematography and testimonials are amazing, and the film is an excellent look at how coal companies like Massey Energy have the state of West Virginia at their mercy.
Accounts from local people who have been affected (poisoned, displaced) depict how communities have increasingly resisted the destruction of their homes and contamination of their air and water.
A three year New York lawsuit against ExxonMobil over the cleanup of Newtown Creek, a heavily polluted section of Brooklyn's Greenpoint area, has resulted in the oil giant's agreement to contribute $25 million to boost remediation of the area, as well as $5 million in penalties and costs.
Newton Creek was finally added to the Environmental Protection Agency's Superfund National Priorities List at the end of September, well over a century after heavy industrial activity contaminated the area with millions of gallons of oil, poisonous PCBs, pesticides, and other highly dangerous substances. Also responsible for major oil spills in the area are supermajors BP and Chevron.
The addition of many Congressional polluter-allies through the midterm elections doesn't bode well for the Superfund program, which went bankrupt in 2003 following a major loss of tax income in 1995. While the EPA has asked Congress for a renewal of taxation on petrochemical companies in order to fund the cleanup of their ongoing messes, as opposed to using public funds to take responsibility for the pollution. Industry opposition plays the same scare-cards we see over and over: forced outsourcing, dead jobs, and a loss of international marketplace competiton.
As ExxonMobil barely scrapes by with a 2009 profit of 19.2 billion and Chevron's meager $10.4 billion net revenue, it's understandable why the industry would be concerned. Exxon's recent $30 million commitment sucks up a staggering 0.002% of their 2009 profit.
This story was picked up from the New York Times.
Officials responsible for safety at the Upper Big Branch coal mine during the April 3rd, 2010 disaster have decided to live by the old maxim “better to keep your mouth shut and appear guilty than to open your mouth and remove all doubt.”
“Approximately 15 Massey upper-management employees have pled their Fifth Amendment right not to provide potentially self-incriminating evidence during the interview process,” according to the US Mine Safety and Health Administration, the government agency responsible for investigating the Upper Big Branch mine disaster that killed 29 miners.
At least six of those who have refused to cooperate with MHSA were high-level safety personnel at Upper Big Branch during the explosion. Lawyers for the Massey officials issued letters to the state announcing their clients’ refusal to testify in the investigation for fear of incriminating themselves, while maintaining that they “did nothing wrong.” The refusal of those responsible for safety at UBB to testify is not a surprise, given the numerous allegations that Massey management took major risks with human life rather than threaten profits.
The refusal of top Massey safety officials to cooperate in the investigation is part of a wider campaign orchestrated by the coal company to discredit the U.S. Mine Safety and Health Administration in hopes of influencing public opinion. Though nominally independent, the Massey officials’ lawyers are paid by Massey, and have parroted Massey’s corporate lawyers’ accusations of wrongdoing by government agencies. Massey Energy’s legal team claims that the investigations were being used more as a means of “generating public bias against Massey Energy and its personnel than they are in respecting the rule of law and fair process.” Following in lockstep, “independent” lawyers representing the Massey officials claim the investigations are “not being conducted properly” by MSHA, who is using its investigation to "divert attention and blame from itself and onto others."
Massey’s strategy has also included an attack on the independent investigation team appointed by Gov. Joe Manchin, which Massey-affiliated lawyers allege have "bullied and abused" some witnesses.
For the record, these are the names and positions of Massey officials refusing to work with the MSHA investigation that have been released:
* Jamie Ferguson, vice president of Massey subsidiary Performance Coal;
* Wayne Persinger, a general manager at Upper Big Branch;
* Rick Nicolau, a maintenance chief at the mine;
* Mine foremen Rick Foster and Gary May.
From the West Virginia Gazette
Tar sands mining has been credited as the largest industrial project on the planet, and comes with extreme costs to the region's people, forests, waterways, animal species, and the broader specter of global warming. If you missed it, National Geographic published a great piece on the controversies of tar sand operations.
As noted by DeSmog, Valero faces declining oil sources from Mexico and a shifty political scene in Venezuela, turning to the tar sands craze in Canada to secure more access to oil. The rapid development of tar sands extraction has helped secure Canada as the United States' top supplier of oil--we import almost twice as much oil from Canada as from Saudi Arabia, and half of Canada's oil is sourced from tar sands mining.
As the refining of bitumen from tar sands mines creates particularly dirty fuel, Valero and the other oil companies crawling around northern Alberta aren't happy to see California's Global Warming Solutions Act survive Proposition 23. Pullman notes:
As tar sands oil has a much larger carbon footprint than conventional oil, climate change legislation targeted by Prop 23 would limit California's imports of high-carbon fuels -- fuels that would likely include toxic tar sands oil from Alberta. Valero's Texas refineries may be halfway across the United States, but industry worries about the 'domino effect' of climate change legislative efforts and how they may be adopted elsewhere.
While Prop 23 flopped, Proposition 26 did pass, to the delight of some of its most philanthropic financiers. Chevron spent almost $4 million on the initiative, and ConocoPhillips, Exxon, Shell, and Occidental Petroleum added another $1,125,000.
All of these giants are involved in tar sands production, and have just as much motivation as Valero to roadblock a low carbon fuel standard.
Be sure to check out Pullman's full article on Valero's mischief.