One section of Gov. Jim Doyle’s proposed “green jobs” bill has petroleum marketers seeing red.
Wisconsin and about 20 states are trying to pass a low-carbon standard for motor fuel.
That proposed low-carbon emission standard, critics contend, could impose strict California-style low-carbon standards on Wisconsin gas dealers and motorists.
That could be particularly tough on western Wisconsin, now dependent on heavy crude from the oil sands of Alberta, Canada.
The Kwik Trip convenience store chain gets most of its petroleum products from the Flint Hills Resources Pine Bend Refinery near St. Paul, which specializes in processing Canadian oil.
That crude has come under scrutiny because it requires more energy to get out of the ground and refine. The environmental impact in terms of greenhouse gases is greater than refining light crude from such suppliers as Saudi Arabia.
Still, Canada’s proximity has helped it become the No. 1 oil supplier to the U.S., with Saudi Arabia second. And the amount of Canadian oil flowing into the U.S. continues to grow.
Adopting a low-carbon standard could increase Wisconsin gas prices by up to $1 a gallon and fuel oil prices by $400 a season, said Steve Loehr, vice president of operations support at Kwik Trip.
“Coming up with these carbon footprints would really penalize the consumer in Wisconsin,” Loehr said. “We would oppose any legislation that makes it more expensive for Wisconsin consumers.”
David J. Podratz, manager of the Murphy Oil refinery in Superior, Wis., said at a Feb. 10 public hearing in Madison that 150 full-time employees and a contractor work force that averages 125 full-time employees “are threatened by this legislation.”
Doyle sounded willing to make concessions in the bill at a recent Tribune editorial board session.
“I understand we’re going to have to do some things to get the bill passed and work with businesses to get it done,” Doyle said.
The low-carbon provision “really is not at the core of what this bill is all about,” he said.
The bill’s main provision is to have Wisconsin reach 25 percent renewable energy in electrical generation by 2025, Doyle said, adding that jobs can be created in the process.
Rod Nilsestuen, secretary of the state Department of Agriculture, Trade and Consumer Protection, defended the low-carbon standard at the Feb. 10 hearing.
Rather than hobble the state, the standard “provides an opportunity for Wisconsin and the Midwest to take advantage of our ethanol and biofuels industries,” Nilsestuen said.
Yet even some of Doyle’s fellow Democrats aren’t sold on the low-carbon idea. Both state Senate Special Committee on Clean Energy Jobs co-chairman Jeff Plale and state Sen. Robert Jauch, D-Poplar, opposed the standard at the Feb. 10 hearing.
They both feared losing jobs — Jauch’s district has the Murphy Oil refinery in Superior, while Plale’s district includes South Milwaukee, headquarters for Bucyrus International, which makes mining equipment widely used in the Alberta oil sands region.
“I think a lot of our stable energy, stable oil, is going to continue to rely on our neighbors up north,” Plale said.
And the low-carbon standard would require a consensus of Midwestern governors before it could take effect — a safeguard that insures no state would be at a competitive disadvantage.
Even if the United States did adopt a carbon standard that rules out using Canadian oil sand crude, it would continue to be mined and sold, Loehr said.
“China has already said they’ll take every gallon. It’s not like that industry is going to stop.”