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BP pulls out of regional oil trade organization over differences on carbon pricing, fuel standard

BP sign at the Alaska State Fair in Palmer, Aug. 27, 2019. (Bill Roth / ADN)

Fossil fuel giant BP announced it was leaving the Western States Petroleum Association (WSPA), a powerful oil and gas lobbying group in statehouses, over the association’s position on carbon pricing and its opposition to a low-carbon fuel standard being considered now in Olympia.

The oil company said in a news release that its policies no longer aligned with WSPA and that the differences could not be reconciled.

Environmentalists hope BP’s departure will weaken the influence of WSPA in Washington state, where it has opposed the clean fuel standard and other climate policies. In 2018, BP spent nearly $13 million and was the top contributor to WSPA’s “No On 1631,” a campaign in opposition to a statewide carbon-pricing initiative. After record spending, the measure failed at the ballot box.

BP’s decision to leave the organization also pushes it further down a path toward advocating more aggressive climate change policies, rather than serving as a legislative roadblock as it has in the past.

“It certainly welcomes them at the table, and the devil, though, is in the details,” said Clifford Traisman, a lobbyist in Olympia for Washington Conservation Voters and the Washington Environmental Council, two major environmental lobbying groups. “We have to see their position on the various bills as they move through. But, it’s welcome news.”

WSPA President Catherine Reheis-Boyd said the organizations’ members will continue to work with BP and other stakeholders “in a civil public discourse around creating a sustainable energy future.” WSPA represents the oil and gas industry in Arizona, California, Nevada, Oregon and Washington.

Added Reheis-Boyd: “Our members know the way the world produces, distributes and consumes energy is evolving, and our industry will remain leaders in investing in and developing the diverse energy sources and technologies we need for the future. Working together as an industry, we will rise to the challenge of a changing climate.”

BP reviewed its association with 30 trade groups, publishing its assessment in detailed report. The company plans to leave two other groups, American Fuel and Petrochemical Manufacturers and the Western Energy Alliance.

BP’s decision to leave WSPA stems from two policy disagreements in Washington state, according to the report.

WSPA has opposed Senate Bill 5981, which would place an overall cap on state carbon emissions that lowers over time. Pollution allowances in the bill would raise funds to invest in energy efficiency, low-income assistance and other projects.

BP last month launched a two-week print, radio and social media campaign in support of the bill, which remains unlikely to pass this Legislative session.

In its report, BP said it also disagreed with WSPA’s focus on preventing a statewide low carbon fuel standard, a legislative measure that is a top priority of Gov. Jay Inslee. BP has taken a neutral stance on the bill, which would require suppliers to reduce the carbon intensity of their fuels over time.

The low carbon fuel standard bill, House Bill 1110, passed in the House last month and now resides in the Senate Transportation Committee, where its fate could be decided.

The chair of that committee, Sen. Steve Hobbs, a Lake Stevens Democrat, has been critical of the policy in the past, saying he’s concerned it could stress the state’s transportation budget and that he views carbon pricing as a more effective policy to reduce greenhouse gases.

BP on Tuesday gave its support to another Inslee legislative priority. Chairman and President of BP America Susan Dio, sent a letter to the governor in support of a bill that would expand the state ecology department’s ability to regulate greenhouse gases.

The bill would refashion Inslee’s 2016 Clean Air Rule, which was partially invalidated by the Washington Supreme Court. The bill would require the state Ecology Department to adopt a rule to reduce greenhouse gases, including those from indirect emitters, beginning no earlier than summer 2021.

“We hope BP’s support of this legislation is helpful, and we commit to working with all parties in Olympia to bring a well-designed carbon pricing policy over the finish line,” Dio wrote.

To Traisman, the environmental lobbyist, BP’s recent actions represented a recognizable shift.

“The fact that they not only pulled out of WSPA, but endorsed one of the governor’s highest priority bills is certainly significant,” Traisman said.

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