Washington’s original swamp creatures: Big Oil’s refineries
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With Republicans in control in Washington, the original K Street swamp creature, Big Oil, is getting nearly everything it wants. Their lobbyists have secured more drilling, the gutting of environmental regulations, new pipelines, and oil guys running the State Department, Energy Department, and EPA.

Despite all this, Big Oil is claiming to be a victim of “the swamp,” and attacking the Trump administration for not doing enough.


A few small refineries are upset the president is keeping his promise to heartland voters by protecting the Renewable Fuel Standard (RFS). In fact, Big Oil sent a group led by Sen. Ted CruzRafael (Ted) Edward CruzGOP lays debate trap for 2020 Democrats O'Rourke on Senate bid backer Beyoncé: I will have to 'earn her support' for 2020 Hickenlooper, Bennet bring deep ties to 2020 debate stage MORE to complain to Trump, and they’re ordering their attack dogs to bite the hand that feeds them.

Cruz knows Trump promised to protect the RFS because they fought about it in the 2016 primary.  Big Oil remembers that promise too.  But after spending $119 million on lobbying last year, and getting nearly everything they want this year, Big Oil claims to be a poor, helpless victim and is attacking Trump for not doing more.

The fact is these refineries made a bet. When the RFS passed, they could either invest in infrastructure to blend biofuels into their fuel supply, or buy credits, called RINs, from refineries that made such investments. Most refineries made investments in infrastructure. Some, like CVR Energy, decided to roll the dice on a RIN-only strategy. That left them exposed. But when they rolled snake-eyes, they turned to government for a bailout.  First to Obama, and now to Trump.

Ironically, Jack Lipinski, CEO of Carl Ichan controlled CVR Energy, attacked Trump for failing to rewrite the rules for CVR, saying Trump “failed to drain the swamp” and that he “caved” by keeping his campaign promise. Trump kept his word, didn’t bail out a billionaire friend, and that’s cronyism? 

These guys live in a fantasy world where “free market think tanks” and industry groups argue any clean energy policy support is a market distortion while the never-ending subsidies that sustain their fossilized industries are fine. Earlier this year, for example, Reuters uncovered Valero’s “extensive behind-the-scenes lobbying campaign” against renewable biofuels. According to the detailed report, Valero’s “secret” lobbying campaign is designed to secure regulatory handouts that “would amount to a multi-billion-dollar transfer of wealth to Valero” - not exactly the free market at work. 

They ran a similar playbook under President Obama, threatening blue collar jobs while announcing surging profits and paying their CEOs multimillion dollar salaries. They want government to undo their bet that RIN prices would fall, while refusing to invest in infrastructure to comply with the law. Such investment would create jobs. But the oil industry hasn’t built a new refinery in over thirty years. Since then, hundreds of biorefineries have been built, supporting hundreds of thousands of jobs. Instead of making their own investments, they sow uncertainty around the RFS, which hurts investment and job growth in rural America.

The RFS has created thousands of jobs. But Big Oil wants to gut it even though only one small refinery - PES Refining - faces financial trouble. PES begged the Obama administration and Pennsylvania for a taxpayer-funded bailout, and asked Obama to rewrite the RFS rules just for them.  It got its taxpayer funded bailout, but didn’t keep its promise to build the infrastructure necessary to stay competitive. Now PES is asking for another bailout and making more promises. It’s a sham. As Trump’s EPA noted, “refiners are generally able to recover the cost of RINs in the prices they receive for their refined products, and therefore high RIN prices do not cause significant harm to refiners.” Independent research backs up this conclusion. Even PES’s union leaders that have said RINs “might not be impacting [the refinery] as stated.”

Fossil fuels are often the product of ancient swamps, so maybe it’s no surprise Big Oil thrives in this environment. Their strategy of cronyism, bailouts, and government protection from competition and markets has worked. But to now turn around and claim to be a victim of the environment they’ve done so much to create, while asking for another round of bailouts, may be the swampiest thing of all time.

Mike Carr is the executive director of New Energy America, an organization that promotes clean energy jobs in rural America. Previously, he served as principal deputy assistant secretary in the Office of Energy Efficiency and Renewable Energy at the Department of Energy.