Energy policy in California

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Fracking in the U.S.
Energy policy in the U.S.
State fracking policy
State energy policy
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Energy policy revolves the production, distribution, and consumption of energy. Specific energy policies are enacted and enforced at the local, state, and federal levels. These policies can have economic and environmental impacts. Stakeholders involved in the policymaking process include citizens, politicians, activist groups, industry groups, and think tanks. A variety of factors can affect the feasibility of specific energy policies, including available natural resources, geography, and consumer needs.

See the tabs below for further information:

  1. Production: This tab provides information about energy production by energy source (e.g., crude oil, coal, etc.).
  2. Usage: This tab presents information about electricity generation and consumption by energy source.
  3. Prices and taxes: This tab presents information about average energy and electricity prices, per capita spending on energy, and fuel taxes.
  4. Policy: This tab presents information about legislation and ballot measures related to energy issues.
  5. State overview: This tab presents contextual information about California, including demographic data, presidential voting history, and economic indicators.
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Available energy resources

Energy is produced in every state, using nonrenewable sources (e.g., coal, oil, or gas), renewable sources (e.g., hydropower, wind, or solar energy), or both. According to the United States Department of Energy, fossil fuels comprise the majority of the resources used to generate power in the United States. However, not every state has fossil fuel resources; states lacking these resources import these types of fuel. Renewable sources are used to generate power in every state, with hydropower accounting for about half of all renewable energy production in the country, according to the Department of Energy.[1]

Production

The table below provides information regarding energy production in California in British thermal units (Btu). A British thermal unit is a means of measuring the heat contained in fuels. The United States Department of Energy defines a Btu as "the quantity of heat required to raise the temperature of 1 pound of liquid water by 1 degree Fahrenheit." Fuels are sometimes discussed in terms of Btu to facilitate comparisons between different types of fuels with different energy contents and prices. For context, one gallon of gasoline equals 120,524 Btu.[2]

Energy production, 2014 (in billion Btu)
State Biomass Coal Crude oil Nuclear energy Natural gas Renewable Total*
California 25,373 0 1,184,760 177,656 284,953 766,125 2,438,867
Arizona 5,939 173,337 325 338,044 109 123,235 640,989
Nevada 0 0 1,833 0 3 69,304 71,140
Oregon 5,844 0 0 0 974 478,961 485,779
U.S. average 38,759 404,181 307,301 160,980 585,731 187,132 1,684,085
*Total figures were computed by Ballotpedia by adding up the other production columns for each state.
Source: U.S. Energy Information Administration, "Google Sheets API"
Nonrenewable energy production

The table below provides information regarding nonrenewable energy production in California. For coal data, the phrase productive capacity refers to the maximum amount of coal that could be expected to be produced in 2014. The natural gas and crude oil production data refer to the amounts of natural gas and crude oil produced in December 2014 and April 2016, respectively.[3][4]

Nonrenewable energy production
State Coal, productive capacity
(short tons)
Natural gas
(million cubic feet)
Crude oil
(thousand barrels)
Date 2014 December 2014 April 2016
California 0 21,085 15,676
Arizona 8,500,000 12 0
Nevada 0 0 26
Oregon 0 80 0
U.S. average 24,874,314 43,350 4,388
Source: U.S. Energy Information Administration, "Google Sheets API"

Oil and gas extraction

Private lands

The graph and table below provide information about crude oil production in California. Information from select surrounding states is provided for comparative purposes.[5]

Crude oil production comparison California.png



The graph and table below provide information about natural gas production in California. Information from select surrounding states is provided for comparative purposes.[6]

Natural gas production comparison California.png



Coalbed methane, a type of methane that is similar to natural gas, was produced in 12 states from 2003 to 2013. California was not one of these states.[7][8]

Shale gas, natural gas found in shale plays, was produced in 14 states from 2007 to 2013. Shale gas was not produced in California from 2007 to 2013.[9][10]

Wells

The bar graph and table present information about the number of crude oil wells in California. Information from select surrounding states is provided for comparative purposes.[11]

Crude oil wells comparison California.png



The bar graph and table below present information about the number of producing natural gas wells in California. Information from select surrounding states is provided for comparative purposes.[12]

Natural gas wells comparison California.png



Injection wells

An example of a Class II injection well

Injection wells are used to store fluid or other substances (e.g., carbon dioxide) under the earth. There are a variety of injection well types, some of which are shallow and are used to store water and non-hazardous liquids. Class II wells are used to store salt water and other fluids produced during the oil and gas extraction process. In 2011, 32 states had Class II injection wells. The table below provides information about injection wells in California and select surrounding states. The map in this section displays the distribution of injection wells in each state that has Class II injection wells.[13][14][15]

Class II injection wells in California and adjacent states,
in 2011
State Class II injection wells Percent of total Class II injection wells
California 47,624 28.33%
New Mexico 4,616 2.75%
Nevada 18 0.01%
Oregon 8 0.0%
United States 168,089 --
Source: U.S. Environmental Protection Agency, "UIC Inventory by State - 2011"


Injection wells by state, 2011
A darker color indicates a greater number of wells; scroll over a state to see the number of wells it had in 2011.


Economic impact

Taxes, fees and revenue

According to the National Conference of State Legislatures, oil and gas booms (including fracking booms) can increase local government revenues through increases in property and sales tax collections. Federal and state governments collect revenues through mineral leasing and severance taxes. Mineral leasing revenues are generated by those who lease their property to oil and gas developers. Severance taxes are intended to compensate present and future citizens of the state from which natural resources are extracted ("severed") for the loss of those natural resources.[16][17]

The pie charts below compare oil and gas severance taxes in California to the United States average. The table below the charts presents tax revenue data for California and select surrounding states. This information comes from the United States Census Bureau.[18]

California state tax revenue by source, 2014
U.S. average state tax revenue by source, 2014

Economic impact studies

The studies below estimate the economic impact of the oil and natural gas industry (also categorized as the mining industry in some studies) in California and across the United States. The author(s) and sponsor(s) of each study have been listed.

Study for the American Petroleum Institute

Economic modeling

IMPLAN and REMI are two econometric modeling systems used in both the private and public sectors to predict economic outcomes of policy changes. Their results are theoretical and may not be universally accepted.

Economists use forecasting models, such as IMPLAN and REMI, to predict the impact increased fossil fuel extraction has on the economy. These studies measure both direct impacts (the jobs and income being added within the oil and gas industry) and indirect impacts (jobs created throughout the supply chain). These studies also address induced impact (jobs created through the increased spending that results from industry growth).[22]

PricewaterhouseCoopers LLP (PwC), a research consulting firm, completed a study for the American Petroleum Institute about the economic impact of the oil and natural gas industry in 2011 in California. According to the PwC study, the oil and gas industry added $131.45 billion in total value in California in 2011, including direct, indirect, and induced value. Of this total, $69.47 billion was direct, $27.79 billion was indirect, and $34.19 billion was induced.[22]

Employment
A rig worker in Williston, North Dakota

The PwC study attributed 793,210 jobs, or 4.1 percent of California's total employment in 2011, to jobs created directly or indirectly by, or induced from, the oil and natural gas industry. The industry directly employed 182,777 people. Indirectly, the industry employed 235,546 people. There were 374,887 induced jobs.[22]

Direct, indirect, and induced labor income, according to this study, totaled $58.88 billion, comprising 4.9 percent of the state's total labor income in 2011. Direct labor income from the mining sector totaled $21.73 billion. Indirect labor income totaled $17.16 billion. Induced labor income equaled almost $20 billion.[22]

Study by the Congressional Budget Office

In December 2014, the Congressional Budget Office (CBO), which is responsible for nonpartisan analysis for Congress, published a study on the economic and budgetary effects of increased oil and natural gas production. The study estimated that without the increase in oil and gas production, natural gas and oil prices would be 70 percent and 5 percent higher, respectively. The CBO also predicted that due to increased oil and gas production, gross domestic product (GDP) would be 1 percent higher in 2040. The growth in fracking would also, according to the study, contribute $43 billion in federal taxes by 2040 and $300 million annually in federal royalties by 2040.[24][25]


Environmental impact

See also: Oil and natural gas pollution

Because of the sudden and unprecedented growth in fracking across the United States, getting high-quality, unbiased, state-specific information on the environmental impacts of fracking is difficult. Most studies that fit those first two qualifications are government studies that focus on the nation as a whole. As such, much of the information that follows in this section may only apply generally to the state. State-specific information has been added where possible. If you would like to nominate another study for inclusion on this page, please send an email to [email protected].

An oil rig off the coast of Surfside, CA

Air impacts

See also: Air pollution

As with any type of energy extraction, there are steps throughout the extraction process during which air pollution can occur. In the case of fracking, air pollution can occur when oil or natural gas is extracted, transported, or distributed. There are different types of pollutants that can be released, including volatile organic compounds (VOCs), hydrogen sulfide (H2S), polycyclic aromatic hydrocarbons (PAHs), particulate matter, and methane. For example, methane can potentially leak as oil and natural gas wells are drilled, resulting in pollution. Fracking operations can also emit known carcinogens, which have been linked to increased rates of cancer.[26][27][28][29]

Emissions

The U.S. Environmental Protection Agency (EPA) estimated in a July 2015 report that, on average, 1,672 pounds of carbon dioxide, 12 pounds of sulfur dioxide, and four pounds of nitrogen oxide are emitted per megawatt hour (MWh) of electricity produced from burning oil. Natural gas-fired energy generation emits 1,135 pounds of carbon dioxide per MWh of electricity, 0.1 pounds of sulfur dioxide per MWh, and 1.7 pounds of nitrogen oxide per MWh.[30][31]

Earthquakes

See also: Seismicity
Differences betwee wastewater, produced water, and flowback

The terms wastewater, produced water, and flowback are used interchangeably, but all three refer to different types of water.


According to the United States Geological Survey (USGS), "the number of earthquakes has increased ... over the past few years within the central and eastern United States. Nearly 450 earthquakes magnitude 3.0 and larger occurred in the four years from 2010 to 2013, over 100 per year on average, compared with an average rate of 20 earthquakes per year observed from 1970 to 2000." Regarding the possible link between fracking and the increased frequency of earthquakes in the eastern and central United States, the USGS made the following observation:[34][35]

Many questions have been raised about whether hydraulic fracturing — commonly known as 'fracking'— is responsible for the recent increase of earthquakes. USGS’s studies suggest that the actual hydraulic fracturing process is only very rarely the direct cause of felt earthquakes. While hydraulic fracturing works by making thousands of extremely small 'microearthquakes,' they are, with just a few exceptions, too small to be felt; none have been large enough to cause structural damage.[36]
—U.S. Geological Survey

According to the USGS, "scientists have found that at some locations the increase in seismicity coincides with the injection of wastewater in deep disposal wells. Much of this wastewater is a byproduct of oil and gas production and is routinely disposed of by injection into wells specifically designed for this purpose." Once a well has been fracked, water returns to the earth's surface; this water contains salt and other contaminants. Some of this water can be recycled, but the water that cannot be recycled is often stored in injection wells. According to NPR, injection wells are generally considered the safest and most cost-effective place for wastewater to be stored. Injection wells are located thousands of feet underground and are encased in cement. The U.S. Environmental Protection Agency (EPA) estimated that, as of 2011, there were 144,000 injection wells across the United States receiving 2 billion gallons of frack fluid per day. According to the EPA, California had 47,624 injection well(s) in 2011, 28.33 percent of all such wells across the country.[34][37][38][39][37]

Map of areas with man-made earthquakes that the USGS said are related to "fluid injection, mining, and conventional oil and gas production."[35] Click to enlarge.

Water impacts

See also: Water pollution
The stages of the hydraulic fracturing water cycle
Click to enlarge.

2016 EPA study on fracking

See also: The EPA study on fracking and drinking water resources (2016)

On December 13, 2016, the Environmental Protection Agency (EPA) released a final report requested by Congress in 2010 on the impact of hydraulic fracturing (fracking) on drinking water resources. The EPA report stated that there was "scientific evidence that hydraulic fracturing activities can impact drinking water resources in the United States under some circumstances." An earlier draft version of the report, released in June 2015, concluded that fracking had not resulted in any widespread or systemic impact on drinking water quality. That conclusion was deleted in the report's final version. Instead, according to Tom Burke, EPA Deputy Administrator, "We [the EPA] found scientific evidence of impacts to drinking water resources at each stage of the hydraulic fracturing water cycle."[40] According to the report, the agency based its study on 1,200 scientific sources, peer review by the EPA's Science Advisory Board, and input from federal, state, local, tribal, and industry officials.[41][42] However, the EPA acknowledged that its findings were limited in scope, reporting that "uncertainties and data gaps limited the EPA's ability to fully assess impacts to drinking water resources both locally and nationally."

The December 2016 report is a finalized version of an interim report issued by the EPA in 2015. To read more about the interim report, see this article.

Findings

The EPA concluded that, in some circumstances, poorly constructed drilling wells and incorrect wastewater management affected drinking water resources, particularly near drilling sites. According to the report, effects on drinking water "ranged in severity, from temporary changes in water quality to contamination that made private drinking wells unusable." Instances where drinking water resources were more vulnerable included the following:

  • Water withdrawals for hydraulic fracturing in times or areas of low water availability, particularly in areas with limited or declining groundwater resources;
  • Spills during the management of hydraulic fracturing fluids and chemicals or produced water that result in large volumes or high concentrations of chemicals reaching groundwater resources;
  • Injection of hydraulic fracturing fluids into wells with inadequate mechanical integrity, allowing gases or liquids to move to groundwater resources;
  • Injection of hydraulic fracturing fluids directly into groundwater resources;
  • Discharge of inadequately treated hydraulic fracturing wastewater to surface water resources; and
  • Disposal or storage of hydraulic fracturing wastewater in unlined pits, resulting in contamination of groundwater resources.[36]
—Environmental Protection Agency[41]

The report focused on the potential impact on water sources during five stages of the fracking process:[41][42]

  • The acquisition of water to be used for fracking
  • The mixing of chemical additives and water to make fracking fluids
  • The injection of fracking fluids into a production well to create and enlarge fractures in the targeted production zone.
  • The collection of wastewater that returns through a well after the injection of fracking fluids
  • The management of wastewater through disposal or reuse.

Reactions

  • The American Petroleum Institute (API), which represents the oil and natural gas industry, criticized the EPA report as misleading. "It is beyond absurd for the administration to reverse course on its way out the door. The agency has walked away from nearly a thousand sources of information from published papers, technical reports, and peer-reviewed scientific reports demonstrating that industry practices, industry trends, and regulatory programs protect water resources at every step of the hydraulic fracturing process. Decisions like this amplify the public's frustrations with Washington," said API Upstream Director Erik Milito. Milito further stated, "Fortunately, the science and data clearly demonstrate that hydraulic fracturing does not lead to widespread, systemic impacts to drinking water resources. Unfortunately, consumers have witnessed five years and millions of dollars expended only to see a conclusion based in science changed to a conclusion based in political ambiguity."[43]
  • Energy in Depth, a website established by the Independent Petroleum Association of America, an oil and gas industry group, endorsed the EPA's conclusion, which it argues reinforces its view that there is no systematic impact from fracking, but also criticized the EPA's role in the report. A spokesperson for the website said, "EPA’s report blows apart the anti-fracking campaign’s most common claim, namely that hydraulic fracturing is polluting groundwater all across America" but that the "EPA did its best to inject politics into this good news by inflating concerns about groundwater, no doubt as a parting thank-you gift to the ‘Keep It In the Ground’ movement." The Keep It In the Ground movement refers to a collection of individuals, legislators, and organizations that oppose future oil and natural gas drilling.[40][44]
  • Food and Water Watch, an environmental group that opposes fracking, said the report confirmed its view that fracking contaminates drinking water. According to Wenonah Hauter, the group's executive director, "The EPA has confirmed what we’ve known all along: fracking can and does contaminate drinking water. We are pleased that the agency has acted on the recommendations of its Science Advisory Board and chosen [sic] be frank about the inherent harms and hazards of fracking. Today the Obama administration has rightly prioritized facts and science, and put public health and environmental protection over the profit-driven interests of the oil and gas industry."[45]
  • The Sierra Club, an environmental group that opposes fracking, said the report confirmed its view that fracking negatively affects drinking water. According to the group's official statement, "The Sierra Club applauds the EPA for its science-based fracking report, confirming what so many already knew; fracking presents a clear and present threat to our water, our public health, and our communities. For far too long, communities around the country have faced the daily threat of contaminated water, earthquakes, and an uncertain future due to fracking, all while oil and gas companies peddled the false claim that the process was safe. Today’s report ends this charade. No longer will families be told a lie as their health and safety are threatened."[46]

2015 Duke University study

A September 2015 study from researchers at Duke University found that fracking operations used 250 billion gallons of water from 2005 to 2014, which accounted for less than 1 percent of all water use nationwide. During that time, fracking also produced 210 billion gallons of wastewater. The study also found that "compared to other energy extraction methods, fracking is less water-intensive in the long run" because less water is used for each unit of energy that is produced. This study was funded by the National Science Foundation and the Duke University Energy Initiative.[47][48][49]

Water use in California

There is limited information available about the amounts of water used to frack in each state. The graphs and table below present information about estimated water use in the mining sector as of 2010. The U.S. Geological Survey (USGS) defines mining as "quarrying, milling of mined materials, injection of water for secondary oil recovery or for unconventional oil and gas recovery (such as hydraulic fracturing), and other operations associated with mining activities." As such, not all of the water use detailed below can be attributed to fracking operations. According to the USGS, the mining sector accounted for the largest increase in water use from 2005 to 2010.[50]

Water use in California, 2010
Average water use in the United States, 2010


In 2014, SB 1281 became law, requiring oil and gas producers in the state to file quarterly water use reports beginning in 2015. The Division of Oil, Gas, and Geothermal Resources released the first summary of these reports in August 2015. The report, which accounted for the water used by almost 60 percent of all oil and gas operators in the state at the time (242 operators), found that the oil and gas industry consumed 69,000 acre feet of water in the first quarter of 2015; of this total, 41,402 acre feet were used for hydraulically fracturing wells.[51][52][53][54]


Recent legislation

The following is a list of recent fracking policy bills that have been introduced in or passed by the California state legislature. To learn more about each of these bills, click the bill title. This information is provided by BillTrack50 and LegiScan.

Note: Due to the nature of the sorting process used to generate this list, some results may not be relevant to the topic. If no bills are displayed below, then no legislation pertaining to this topic has been introduced in the legislature recently.


Recent news

The link below is to the most recent stories in a Google news search for the terms California fracking. These results are automatically generated from Google. Ballotpedia does not curate or endorse these articles; they are included to provide readers with the most recent news articles on the subject. Click here to learn more about this section.

Energy policy in California - Google News Feed

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Energy in the 50 states

Click on a state below to read more about energy in that state.

See also

Footnotes

  1. U.S. Department of Energy, "How Much Energy Does Your State Produce?" November 10, 2014
  2. U.S. Energy Information Administration, "British Thermal Units (Btu)," December 15, 2014
  3. U.S. Energy Information Administration, "California State Energy Profile," May 19, 2016
  4. U.S. Energy Information Administration, "Table 13. Productive Capacity and Capacity Utilization of Underground Coal Mines by State and Mining Method, 2014," accessed July 19, 2016
  5. U.S. Energy Information Administration, "Crude Oil Production," July 31, 2015
  6. U.S. Energy Information Administration, "Natural Gas Gross Withdrawals and Production," July 31, 2015
  7. U.S. Geological Survey, "Coal-Bed Methane: Potential and Concerns," October 2000
  8. U.S. Energy Information Administration, "Coalbed Methane Production," December 4, 2014
  9. U.S. Energy Information Administration, “Energy in Brief,” accessed January 28, 2014
  10. U.S. Energy Information Administration, "Shale Gas Production," December 4, 2014
  11. U.S. Energy Information Administration, "Distribution and Production of Oil and Gas Wells by State," January 7, 2011
  12. U.S. Energy Information Administration, "Number of Producing Gas Wells," July 31, 2014
  13. U.S. Environmental Protection Agency, "Basic Information about Injection Wells," May 4, 2012
  14. U.S. Environmental Protection Agency, "Classes of Wells," August 2, 2012
  15. U.S. Environmental Protection Agency, "UIC Inventory by State - 2011," accessed August 25, 2015
  16. Internal Revenue Service, "Tips on Reporting Natural Resource Income," February 19, 2015
  17. National Conference of State Legislatures, "Oil and gas Severance Taxes: States Work to Alleviate Fiscal Pressures Amid the Natural gas Boom," February 2012
  18. U.S. Census Bureau, "State Government Tax Collections Summary Report: 2014," April 16, 2015
  19. IMPLAN, "IMPLAN€'s History of Expert Economic Data," accessed September 17, 2014
  20. REMI, "About Us," accessed September 17, 2014
  21. REMI, "Clients," accessed September 17, 2014
  22. 22.0 22.1 22.2 22.3 PricewaterhouseCooper LLP, "Economic Impacts of the Oil and Natural Gas Industry on the US Economy 2011," July 2013
  23. International Monetary Fund, "Gross Domestic Product: An Economy’s All," accessed September 1, 2015
  24. Congressional Budget Office, "The Economic and Budgetary Effects of Producing Oil and Natural Gas From Shale," December 2014
  25. Congressional Budget Office, "Home," accessed September 1, 2015
  26. University of Oklahoma, "Hydraulic Fracturing and Water Resources," accessed March 15, 2014
  27. National Resources Defense Council, "Written Testimony of Frances Beinecke President, Natural Resources Defense Council Hearing on 'Opportunities and Challenges for Natural gas' Before the Committee on Energy & Natural Resources U.S. Senate," accessed September 10, 2015
  28. Stanford Law School Student Journals, "Local Government Fracking Regulations: A Colorado Case Study," January 2014
  29. U.S. Environmental Protection Agency, "Oil," September 25, 2013
  30. U.S. Environmental Protection Agency, "Emissions from the Oil & Natural Gas Industry," July 1, 2015
  31. U.S. Environmental Protection Agency, "Natural Gas STAR Program (Methane Emissions)," accessed July 24, 2015
  32. Seismology Society of America, "Fracking Confirmed as Cause of Rare 'Felt' Earthquake in Ohio," January 5, 2015
  33. Energy in Depth, "Underground Wastewater Disposal," accessed July 9, 2015
  34. 34.0 34.1 U.S. Geological Survey, "Man-Made Earthquakes Update," January 17, 2014, accessed March 10, 2014
  35. 35.0 35.1 United States Geological Survey, "Incorporating Induced Seismicity in the 2014 United States National Seismic Hazard Model—Results of 2014 Workshop and Sensitivity Studies," 2015
  36. 36.0 36.1 Note: This text is quoted verbatim from the original source. Any inconsistencies are attributed to the original source.
  37. 37.0 37.1 National Geographic, "Scientists Warn of Quake Risk From Fracking Operations," May 2, 2014
  38. National Public Radio, "How Oil and Gas Disposal Wells Can Cause Earthquakes," accessed June 2, 2014
  39. U.S. Environmental Protection Agency, "UIC Inventory by State - 2011," accessed August 25, 2015
  40. 40.0 40.1 The Hill, "EPA reverses course on fracking safety," December 13, 2016
  41. 41.0 41.1 41.2 U.S. Environmental Protection Agency, "Hydraulic Fracturing for Oil and Gas: Impacts from the Hydraulic Fracturing Water Cycle on Drinking Water Resources in the United States (Final Report)," accessed December 13, 2016
  42. 42.0 42.1 U.S. Environmental Protection Agency, "EPA Releases Final Report on Impacts from Hydraulic Fracturing Activities on Drinking Water," December 13, 2016
  43. PR News Wire, "API: EPA distorts science in hydraulic fracturing study," December 13, 2016
  44. Energy in Depth, "*UPDATE* EPA Finalized Groundwater Report Reinforces No Widespread, Systemic Impacts from Fracking," December 13, 2016
  45. Common Dreams, " Statement of Wenonah Hauter, Executive Director, Food & Water Watch," December 13, 2016
  46. Sierra Club, "EPA report confirms threat posed by fracking," December 13, 2016
  47. American Chemical Society, "Water Footprint of Hydraulic Fracturing," September 15, 2015
  48. Duke University, "How Much Water Does U.S. Fracking Really Use?" September 15, 2015
  49. Reuters, "Water demand from fracking less than 1 percent of U.S. total: study," September 15, 2015
  50. U.S. Geological Survey, "Estimated Use of Water in the United States in 2010," accessed August 25, 2015
  51. Power Source "California used 70 million gallons of water in fracking in 2014," April 4, 2015
  52. Division of Oil, Gas, and Geothermal Resources, "Water use reporting for Oil and Gas Production," accessed September 11, 2015
  53. Division of Oil, Gas, and Geothermal Resources, "Water Use SB 1281 Data and Reports," accessed September 11, 2015
  54. Division of Oil, Gas, and Geothermal Resources, "SB 1281 Water Report Summary Division of Oil, Gas, and Geothermal Resources First Quarter 2015," August 12, 2015

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Public lands
See also: Oil and natural gas extraction on federal land

The federal government leases its land to private individuals and companies for energy development; this includes crude oil and natural gas drilling, solar energy development, and geothermal energy development. Approximately 166 million acres of federal land were available to be leased for energy development as of December 2014. The United States Bureau of Land Management (BLM) is the federal agency chiefly responsible for regulating oil and gas drilling on public lands in the United States.[1][2]

The table below provides information about oil and natural gas production on federal lands in California in 2014. Information from select surrounding states is provided for comparison.[3][4]

Oil and natural gas production on federal land, 2014
State Oil production (in thousands of barrels) Natural gas production (in million cubic feet)
California 14,967 7,077
Arizona 0 0
Nevada 314 0
Oregon 0 0
U.S. average 2,976.06 49,996.92
Source: Office of Natural Resource Revenue, "Statistical Information"


Land leased

Private oil and natural gas companies can apply for leases from the BLM to develop energy resources on federal lands. If a lease is approved, the company must submit information to the BLM about how it will conduct its drilling and production operations. The BLM also inspects a company’s operations throughout the production period.[5]

The table below provides information about oil and gas producing leases and acres on federal lands in California from 2013 to 2015. Information from select surrounding states is provided for comparison.

Oil and gas producing leases and acres on federal land, 2013-2015
State FY 2015 FY 2014 FY 2013
Producing leases Producing acres Producing leases Producing acres Producing leases Producing acres
California 320 82,736 323 82,697 325 82,736
Arizona 0 0 0 0 0 0
Nevada 36 21,637 32 22,077 31 21,637
Oregon 0 0 0 0 0 0
U.S. average 485 257,505 483 258,996 480 262,870
Source: U.S. Bureau of Land Management, "Oil and Gas Statistics"

Electricity generation

Electricity is generated in power plants as energy sources (e.g., coal, petroleum, or sunlight) are used to heat water. This heated water becomes steam and rotates a turbine, which generates electricity. This electricity is then transmitted to consumers via transmission lines.[6]

The table below provides information regarding the types of energy used to generate electricity in California in April 2016. Information from select surrounding states is provided for comparison.

Electricity generation, April 2016 (in thousand megawatthours)
State Coal Natural gas Petroleum liquids Nuclear energy Solar Hydropower Wood and wood waste Total
California 29 5,646 4 1,635 2,200 2,759 267 14,591
Arizona 1,676 2,496 10 2,159 467 625 16 7,379
Nevada 71 2,029 1 0 228 230 0 2,854
Oregon 0 450 0 0 15 3,835 45 5,158
U.S. average 1,562.21 2,105.34 178.29 1,372.42 2,030.96 669.09 218.31 5,866.27
Source: U.S. Energy Information Administration, "Google Sheets API"

Consumption

The table below provides information about energy consumption by source in California in 2014. Information from select surrounding states is provided for comparison.[7]

Energy consumption, 2014 (in billion Btu)
State Coal Crude oil and petroleum products Natural gas Nuclear energy Solar Wind Geothermal Hydropower Wood and wood waste Biomass
California 39,486 3,371,579 2,417,476 177,656 180,287 123,559 117,226 157,213 162,466 298,473
Arizona 447,849 515,002 315,448 338,044 46,869 4,452 345 58,185 7,445 31,481
Nevada 79,230 237,511 259,438 0 13,557 2,854 27,499 22,719 2,675 10,681
Oregon 34,238 339,434 225,576 0 3,585 71,852 2,977 335,341 59,361 72,449
United States 359,931 716,746 544,353 172,585 20,739 531,323 16,555 61,397 65,345 101,581
Source: U.S. Energy Information Administration, "Google Sheets API"

Energy prices

The price of electricity is affected by supply and demand. The supply of electricity is affected by fuel prices, environmental and energy regulations, power plant capacity, weather, and other factors. Demand for electricity also affects the price. Because electricity cannot be stored for long periods of time, it must be produced and used when it is needed. Thus, as demand for electricity increases, the price also increases.[9][10]

Table below provides information about energy prices in California as of April 2016. Information from select surrounding states is provided for comparison.[7]

Note: In comparing dollar amounts across the states, it is important to remember that the cost of living varies greatly from state to state and even within a state. The amounts given on this page have not been adjusted to reflect these differences. For more information on "regional price disparities" and the Consumer Price Index, see the U.S. Department of Commerce, Bureau of Economic Analysis.
Energy prices
State Natural gas
Dollars per thousand cubic foot
Electricity
Cents per kilowatthour
Date April 2016 April 2016
California $10.50 12.7
Arizona $16.53 9.9
Nevada $11.25 7.7
Oregon $13.70 8.7
U.S. average $11.20 10.41
Source: U.S. Energy Information Administration, "Google Sheets API"

Electricity prices can vary depending on the type of consumer; consumer categories include residential, commercial, industrial, and in some cases, transportation. The rate-making process is both political and economic. The table below presents information about electricity prices by consumer type in California in April 2016. Information from select surrounding states is provided for comparison.

Electricity prices by sector (in cents per kilowatthour)
State Commercial Industrial Residential Transportation Average (all sectors)
Date April 2016 April 2016 April 2016 April 2016 April 2016
California 13.8 10.7 12.4 8.8 11.4
Arizona 10.1 5.6 12.4 9.4 9.4
Nevada 8.0 5.0 11.9 9.1 8.5
Oregon 8.9 5.8 10.5 9.1 8.6
U.S. average 10.48 7.45 13.05 10.47 10.36
Source: U.S. Energy Information Administration, "Google Sheets API"

Energy spending

The table below provides information about energy spending in California as of 2014. Information from select surrounding states is provided for comparison. [7]

Energy spending, 2014 (in millions of dollars except per capita spending)
State Petroleum Coal Natural gas Nuclear Per capita spending
California $86,002 $135 $16,128 $115 $3,550
Arizona $13,753 $945 $2,156 $277 $3,360
Nevada $6,307 $203 $1,639 $0 $3,704
Oregon $9,426 $87 $1,498 $0 $3,744
U.S. average $17,267 $1,322 $3,786 $574 $5,304
Source: U.S. Energy Information Administration, "Google Sheets API"

Fuel taxes

Click to enlarge.

Revenue collected by federal, state, and local governments from fuel taxes is often used to fund transportation infrastructure such as roads and bridges. Some states may charge an excise tax based on how much gas or diesel is purchased. Some states may charge retail tax based on the average price of gas over a certain period. Additionally, some states may charge an environmental tax to be used toward environmental projects. The Tax Foundation, which created the map below, used data from the American Petroleum Institute, which converted each state's different tax structure into cents per gallon to compare each state's gas taxes. In 2016, gas taxes accounted for 23 percent of the price of gasoline. Crude oil accounted for 40 percent of the price of gasoline, refining accounted for 24 percent of the price, and distribution and marketing accounted for 13 percent of the remainder.[11][12]

Federal tax

The first federal tax on gasoline was proposed by Secretary of the Treasury Ogden L. Mills under President Herbert Hoover (R) as a revenue generating measure to balance the budget during the Great Depression. A 1-cent tax per gallon of imported gasoline and fuel oil was passed as part of the Revenue Act of 1932 and signed by President Franklin D. Roosevelt (D). The 1-cent tax continued until 1951 when the tax was increased to 2 cents in part to raise revenue during the Korean War. In 1956, the tax was raised to 3 cents to fund the Interstate Highway System. During this time, the Highway Trust Fund was created as a means to fund highway construction. Since 1956, there have been increases to the tax. As of April 2016, the gas tax was last raised by President Bill Clinton (D) in 1993 to 18.4 cents per gallon.[13]

State and local taxes

In 1919, Oregon became the first state to implement a gas tax. A decade later, every state in the United States had implemented a gas tax. The table below provides information about fuel taxes by type in California as of January 2016.[14][15]

State motor fuel taxes in cents per gallon, January 2016
State State gasoline tax Total gasoline tax Rank State diesel tax Total diesel tax Rank
California 40.6 59.0 5 34.3 58.7 10
Arizona 19.0 37.4 43 27.0 51.4 29
Nevada 33.9 52.3 11 28.6 53.0 24
Oregon 31.1 49.5 16 30.4 54.8 20
U.S. average 30.29 48.69 N/A 30.01 54.41 N/A
Source: American Petroleum Institute, "Motor Fuel Taxes"


Local governments can also charge gas taxes. The list below shows areas with local gas taxes and the tax total or range as of April 2016. This information comes from the American Road and Transportation Builders Association.[16]


Legislation

Recent legislation

The following is a list of recent energy policy bills that have been introduced in or passed by the California State Legislature. To learn more about each of these bills, click the bill title. This information is provided by BillTrack50 and LegiScan.

Note: Due to the nature of the sorting process used to generate this list, some results may not be relevant to the topic. If no bills are displayed below, no legislation pertaining to this topic has been introduced in the legislature recently.

Ballot measures

Energy policy ballot measures
See also: Energy on the ballot and List of California ballot measures

Ballotpedia has covered 19 ballot measures relating to state and local energy policy in California.

  1. California's AB 32, the "Global Warming Solutions Act of 2006"
  2. California Nuclear Power Initiative (2016)
  3. California Proposition 10, Alternative Fuels Initiative (2008)
  4. California Proposition 12, Regulation of Public Utilities (1974)
  5. California Proposition 12 (1976)
  6. California Proposition 16, Supermajority Vote Required to Create a Community Choice Aggregator (June 2010)
  7. California Proposition 3, Tax Exemption for Alternative Energy (June 1978)
  8. California Proposition 39, Income Tax Increase for Multistate Businesses (2012)
  9. California Proposition 3 (1976)
  10. California Proposition 7, Standards for Renewable Resource Portfolios (2008)
  11. California Proposition 7, Tax Assessments of Solar Energy Improvements (1980)
  12. California Proposition 8, Bonds for Alternative Energy (June 1980)
  13. California Proposition 80, Regulation of Electric Service Providers (2005)
  14. California Proposition 87, Alternative Energy Oil Tax (2006)
  15. California Proposition 9, Mandates on Internal Combustion Fuels (June 1972)
  16. California Publicly-owned Electric Utilities Initiative (2016)
  17. California Water and Power, Proposition 16 (1924)
  18. California Water and Power, Proposition 18 (1926)
  19. California Water and Power, Proposition 19 (1922)
Utility policy ballot measures
See also: Local utility tax and fees on the ballot

Ballotpedia has covered 1 ballot measures relating to local utility tax and fees in California.

  1. California Utility User Taxes

State profile

USA California location map.svg

This excerpt is reprinted here with the permission of the 2016 edition of the Almanac of American Politics and is up to date as of the publication date of that edition. All text is reproduced verbatim, though links have been added by Ballotpedia staff. To read the full chapter on California, click here.


The Golden State—that is how Americans have long thought of California: as a distant and dreamy land initially, then as a shaper of culture and as a promised land for millions of Americans and immigrants for many decades. America’s largest state in terms of population remains in many ways a great success story. But in some ways, it has failed to fulfill its promise. It is the birthplace of much of the world’s most advanced technology, yet it has plenty of Third World neighborhoods. It is home to some of the world’s most creative people and industries, but for five years it posted one of the nation’s highest unemployment rates. Among the states, it has attracted the largest number of immigrants from Mexico, Latin America, and Asia, but it also has seen the largest exodus of citizens to other states.

In the middle of the 20th century, California was the promised land for an American middle class that supported the New Deal and liked Ike, that embraced and personified all-American values in 1940s movies and 1950s television. By the early 21st century, California had become a two-tiered society, with an affluent elite that embraces culturally liberal values—“gentry ... (read more)

Demographic data for California
 CaliforniaU.S.
Total population:38,066,920314,107,084
Land area (sq mi):155,7793,531,905
Gender
Female:50.3%50.8%
Race and ethnicity
White:39.2%62.8%
Black/African American:5.9%12.6%
Asian:13.5%5%
Native American:0.8%0.8%
Pacific Islander:0.4%0.2%
Two or more:4.5%2.9%
Hispanic/Latino:38.2%16.9%
Education
High school graduation rate:81.5%86.3%
College graduation rate:31%29.3%
Income
Median household income:$61,489$53,482
Persons below poverty level:16.4%14.8%
Source: U.S. Census Bureau, "American Community Survey" (5-year estimates 2010-2014)

Presidential voting pattern

See also: Presidential voting trends in California

California voted Democrat in all five presidential elections between 2000 and 2016.


More California coverage on Ballotpedia

Economic indicators

See also: Economic indicators by state
California's GDP increased by 2.8 percent in 2014. Click the image to view a larger version.

Broadly defined, a healthy economy is typically one that has a "stable and strong rate of economic growth" (gross state product, in this case) and low unemployment, among many other factors. The economic health of a state can significantly affect its healthcare costs, insurance coverage, access to care, and citizens' physical and mental health. For instance, during economic downturns, employers may reduce insurance coverage for employees, while those who are laid off may lose coverage altogether. Individuals also tend to spend less on non-urgent care or postpone visits to the doctor when times are hard. These changes in turn may affect the decisions made by policymakers as they react to shifts in the industry. Additionally, a person's socioeconomic status has profound effects on their access to care and the quality of care received.[17][18][19]

California's median annual household income for years 2011 through 2013 was $57,161, highest among neighboring states. The state also had the largest percentage of residents that earned incomes of at least 400 percent above the federal poverty level.[20][21][22][23]

Note: Gross state product (GSP) on its own is not necessarily an indicator of economic health; GSP may also be influenced by state population size. Many factors must be looked at together to assess state economic health.

Various economic indicators by state
State Distribution of population by FPL* (2013) Median annual income (2011-2013) Unemployment rate Total GSP (2013)
Under 100% 100-199% 200-399% 400%+ Sept. 2013 Sept. 2014
California 15% 21% 28% 36% $57,161 8.8% 7.3% $2,202,678
Arizona 20% 23% 25% 31% $49,698 8% 6.9% $279,024
Nevada 17% 26% 28% 29% $49,204 9.6% 7.3% $132,024
Oregon 15% 19% 31% 35% $54,066 7.6% 7.1% $219,590
United States 15% 19% 30% 36% $52,047 7.2% 5.9% $16,701,415
* Federal Poverty Level. "The U.S. Census Bureau's poverty threshold for a family with two adults and one child was $18,751 in 2013. This is the official measurement of poverty used by the Federal Government."
In millions of current dollars. "Gross State Product is a measurement of a state's output; it is the sum of value added from all industries in the state."
Source: The Henry J. Kaiser Family Foundation, "State Health Facts"


See also

Recent news

The link below is to the most recent stories in a Google news search for the terms California energy policy. These results are automatically generated from Google. Ballotpedia does not curate or endorse these articles; they are included to provide readers with the most recent news articles on the subject. Click here to learn more about this section.

Energy policy in California - Google News Feed

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Footnotes

  1. Congressional Research Service, "Federal Land Ownership: Overview and Data," December 29, 2014
  2. U.S. Bureau of Land Management, "Public Land Statistics 2014," May 2015
  3. Western Energy Alliance, "Production," accessed November 25, 2015
  4. James M. Inhofe - U.S. Senator, Oklahoma, "Inhofe Introduces Bill to Achieve Domestic Energy Independence Through State Control of Federal Energy Resources," June 26, 2013
  5. U.S. Bureau of Land Management, "Oil and Gas Lease Sales," accessed October 20, 2014
  6. How Stuff Works, "How Power Grids Work," accessed April 21, 2015
  7. 7.0 7.1 7.2 U.S. Energy Information Administration, "California State Energy Profile," May 19, 2016
  8. U.S. Energy Information Administration, "British Thermal Units (Btu)," December 15, 2014
  9. RWE, "How the electricity price is determined," accessed April 21, 2015
  10. Forbes, "How The Price For Power Is Set," December 26, 2012
  11. U.S. Energy Information Administration, "Gasoline and Diesel Fuel Update," accessed April 25, 2016
  12. Tax Foundation, "How High Are Gas Taxes in Your State?" July 23, 2016
  13. U.S. Department of Transportation, "When did the Federal Government begin collecting the gas tax?" November 18, 2015
  14. The Washington Post, "A (very) brief history of the state gas tax on its 95th birthday," February 25, 2014
  15. American Petroleum Institute, "Motor Fuel Taxes," accessed April 27, 2016
  16. American Road and Transportation Builders Association, "State Motor Fuel Tax Rates," accessed April 26, 2016
  17. Academy Health, "Impact of the Economy on Health Care," August 2009
  18. The Conversation, "Budget explainer: What do key economic indicators tell us about the state of the economy?" May 6, 2015
  19. Health Affairs, "Socioeconomic Disparities In Health: Pathways And Policies," accessed July 13, 2015
  20. The Henry J. Kaiser Family Foundation, "Distribution of Total Population by Federal Poverty Level," accessed July 17, 2015
  21. The Henry J. Kaiser Family Foundation, "Median Annual Household Income," accessed July 17, 2015
  22. The Henry J. Kaiser Family Foundation, "Unemployment Rate (Seasonally Adjusted)," accessed July 17, 2015
  23. The Henry J. Kaiser Family Foundation, "Total Gross State Product (GSP) (millions of current dollars)," accessed July 17, 2015

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