This story by Chase Woodruff appeared on Colorado Newsline on March 25, 2024.
A pair of bills backed by Colorado Democrats aims to crack down on polluters to improve the state’s long-running air quality problem, but opposition from powerful business groups could force significant revisions as the proposals make their way through the Legislature.
Senate Bills 24-165 and 24-166 both had their origins in the Interim Committee on Ozone Air Quality, which was convened last year as a compromise measure after a group of Democratic lawmakers dramatically scaled back a previous proposal to more strictly regulate sources of pollution.
For decades, a nine-county region in and around the Denver metro area has failed to meet federal health standards for ozone set by the Environmental Protection Agency under the Clean Air Act. Significant local contributors to the region’s ozone problem, which peaks in the summer months, include oil and gas operations, gas-powered vehicles, lawn equipment and other industrial sources.
State officials have publicly set a target of bringing the state into compliance with the EPA’s ozone standards by 2027. In an executive order issued last year, Democratic Gov. Jared Polis directed state regulators to require deep cuts in the emission of so-called ozone precursors from oil and gas operations.
SB-165 would codify those requirements in state law. But it would also go a step further, prohibiting oil and gas operators from conducting “pre-production” operations such as drilling and fracking during the summer, unless they use electric-powered equipment.
“There’s still the ability for pre-production if electric rigs are used, because they will not add the (nitrogen oxides and volatile organic compounds) that create the ozone that is so detrimental,” state Sen. Kevin Priola, an Adams County Democrat and bill sponsor, told lawmakers during a March 20 hearing before the Senate Transportation and Energy Committee.
Colorado’s oil and gas industry has decried SB-165 and a slate of other environmental legislation pending in the General Assembly this session. Kait Schwartz, director of the Colorado chapter of the American Petroleum Institute said the bill’s seasonal drilling pause would lead to decreased production.
“Businesses don’t want to come in and work for two months, and then go to Texas, and then come back for two months,” Schwartz said. “It would make it more difficult for operators to operate here if an entire portion of the year is no longer feasible.”
But Mike Foote, a former Democratic state legislator and the chair of the Regional Air Quality Council, pointed to similar claims made by the industry more than a decade ago, when regulators enacted a seasonal drilling pause for natural gas producers on the Western Slope to protect wildlife in certain sensitive habitats. He provided committee members with copies of a Colorado Oil and Gas Association flyer from 2008 that decried the “job-killing rules” proposed by then-Gov. Bill Ritter’s administration.
“The industry has adapted. Drilling hasn’t stopped,” Foote said. “In the context of the ozone seasonal pause, we’re hearing the same thing. I’ll just submit to you that the industry will continue to adapt. It’ll be OK, and they’ll still be able to drill and thrive.”
Democrats on the committee approved SB-165 in a 5-2 vote along party lines, but sponsors amended the bill to shrink the ozone-season pause from five months to three, and to remove a section requiring the Colorado Department of Transportation to set targets to reduce vehicle miles traveled within the ozone non-attainment area.
The other bill heard during Wednesday’s 10-hour committee hearing, SB-166, aims to crack down on polluters who repeatedly violate air quality laws, including what it calls “high-priority repeat violators,” which would face much stiffer prescribed penalties.
Though it’s not specifically singled out in the bill’s text, there’s little mystery about the polluter that would likely be atop that list of violators.
“You should call this the anti-Suncor bill,” Edward Ingve, the owner of a small oil and gas company, told the committee in testimony opposing SB-166.
The Suncor oil refinery in Commerce City — the only such facility in the state — has been hit with millions of dollars in fines as part of enforcement actions and settlements with state regulators over the years. The latest was a record $10.5 million penalty announced by Colorado’s health department last month, for a series of violations between 2019 and 2021.
But critics say that such fines are viewed merely as the cost of doing business for giant corporations like the Canada-based Suncor, which reported $2 billion in profits in the fourth quarter of 2023 alone.
“We know that just one facility, Suncor, has had over a thousand violations in the last five years,” said Ramesh Bhatt, an activist with the Colorado Sierra Club. “Clearly, under the current system, fines are not a great deterrent to these massive companies.”
But SB-166 is opposed by business groups and companies who operate other large industrial facilities, like the EVRAZ steel mill in Pueblo, who worry that they could fall under the bill’s repeat-violator provisions. Annie Stefanec, director of government affairs for EVRAZ North America, said the proposal “would put the mill out of business.”
That comment received strong pushback from state Sen. Faith Winter, a Thornton Democrat and bill sponsor, who said it’s belied by the mill’s good track record and lack of emissions violations.
“How? I haven’t actually heard how you’re going to be caught in the crosshairs,” Winter asked Stefanec. “You’ve had zero violations. … I don’t actually know how this is going to specifically add you to the violator list, because everyone I’ve been working with, and all the lawyers I’ve been working with, have given me the exact opposite information.”
After committee members passed several amendments, including a provision excluding paperwork problems and “other non-emission-related violations” from the bill’s scope, SB-166 passed on a 4-3 vote.
State Sen. Nick Hinrichsen, a Pueblo Democrat, voted against advancing the bill, saying that despite the amendments the proposal hadn’t yet “got the enforcement formula right.” But he also criticized what he called “flippant and unserious comments” by opponents who dismissed the state’s air quality problems.
“One of those comments was that this should be called the ‘let’s punish Suncor bill’ — and to that I say, heck yeah,” Hinrichsen said. “There are some egregious violators in this state, who don’t seem to have any regard for the health of the people of this state, and especially when that harm disproportionately falls on the most vulnerable Coloradans. And this is unacceptable.”