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Memo: ALECs Frack Attack Now Includes LNG Exports, CNG Vehicles

Steve Horn; Research Fellow, DeSmogBlog July, 30 2014



The American Legislative Exchange Council (ALEC) serves as a key vehicle through which cor-
porate producers and consumers of unconventional gas obtained from hydraulic fracturing
(fracking) curry favor and push for policies favorable to their bottom lines in statehouses na-
tionwide.

Most signicantly for its most recent efforts in this space, liqueed natural gas (LNG) exporter
Cheniere became an ALEC dues-paying member in May 2013, joining corporate colleagues like
ExxonMobil, Koch Industries and Dominion, as well as industry lobbying powerhouse, Americas
Natural Gas Alliance (ANGA). ANGA was crowned an ALEC member in August 2013.

From Cradle to Grave, Frackers Use ALEC to Get Their Way

From cradle to grave of the shale gas and oil production lifecycle, ALECs oil and gas industry
corporate patrons have used ALECs lobbying apparatus and inuence peddling machine in
everything but name (they prefer to call it education) to pass model bills and resolutions
through the corporate bill mill.

In many cases, these model bills and resolutions become state law. In the case of fracking, of-
ten model bills and resolutions are passed in statehouses rst and then brought back to ALEC
by corporate lobbyists to become copy-paste templates for other state legislators to bring back
to their legislatures.

Some model bills and resolutions passed in this space by ALEC and eventually becoming state
law in many states include:

1.) Resolution Opposing EPAs Regulatory Train Wreck

-Calls for moratorium onany new air quality regulation by EPA by any means
necessaryfor a period of at least two years, including defunding EPA air
quality regulatory activities

-Introduced in 34 states, passing in 13, as of a June 2011 press release since removed
from ALECs website but up on the Way Back Machine

2.) An Act Granting the Authority of Rural Counties to Transition to Decentralized Land Use
Regulation

-Excerpt: [T]he planning and zoning authority granted to rural counties may encourage
land use regulation which is overly centralized, intrusive and politicizedThe local law
shall require the county to repeal or modify any land use restriction stemming from the
countys exercise of its planning or zoning authority, which prohibits or conditionally
restricts the peaceful or highest and best uses of private property.

-Bills like it have passed in Ohio, Idaho, Colorado, and Texas

3.) Disclosure of Hydraulic Fracturing Fluid Composition Act, endorsed by ExxonMobil at
ALECs Dec. 2011 meeting according to a New York Times investigation

-Modeled after HB 3328 in TX, passed in June 2011

-Bill has passed in TX, CO and proposed in IL, FL, LA; FracFocus implemented in other
states, also ofcial database of U.S. Department of Interiors Bureau of Land
Management (BLM)

This Time Around: LNG Exports and CNG Vehicles

LNG

Having won some key policy ghts in other fracking-centric areas, ALEC has now become a key
hub for its corporate benefactors to push through LNG exports and CNG vehicles.

For example, ALECs 2014 Annual Meeting in Dallas will feature a presentation by Jason
French, Chenieres Director of Government and Public Affairs, on LNG exports and a vote on a
model resolution titled, Resolution In Support of Expanded Liqueed Natural Gas Exports.

According to Frenchs comments provided to me via email, ALEC provided information that
helped shape the resolution and Cheniere has encouraged consideration of a resolution in
support of LNG exports since joining ALEC as a dues-paying member in May 2013.

Research ties the bills origins back to House Concurrent Resolution 29 passed Louisiana in
March 2014, which came in the aftermath of LNG Day. One of the two resolution co-sponsors,
Sen. John A. Alario, Jr., is an ALEC member and has taken signicant campaign contributions
from LNG exporters, such as ExxonMobil, Energy Transfer Partners and Sempra.

Records obtained under Louisianas Public Records Act by DeSmogBlog show LNG Day was
organized and arranged by The Picard Group, a Louisiana-based lobbying rm.

Cheniere sits on The Picard Groups client list and representatives from the company were
copied on email outreach to Louisiana state representatives inviting them to participate in LNG
Day, according to the records received via Louisiana Public Records Act. LNG Day sponsors,
records also show, included Cheniere, ANGA, Sempra LNG, Trunkline LNG, Magnolia LNG, the
Louisiana Oil and Gas Association, Our Energy Moment and Chesapeake Energy.

Though nal LNG exports decisions are made at the federal-level which Cheniere and other
companies also have their bases covered on in terms of currying favor the states still play a
key role in determining whether or not LNG exports ever become a reality.

Finally, it is crucial to point out that in January 2014, the Louisiana-based State Policy Network
offshoot the Pelican Institute commissioned a report promoting LNG exports titled, Risk,
Reward & Revolution: Why globalizing the natural gas revolution is smart environmental and
economic policy for Louisiana. The SPN network, DeSmogBlog revealed in December 2013, is
a creation of ALEC.

Unsurprisingly then, French wrote an article singing a similar tune in the July/August edition of
ALECs magazine, Inside ALEC.

CNG Vehicles

ALEC appears to have become a key hub for the upstart compressed natural gas (CNG) vehi-
cles industry, as well. Using fracked gas as a feedstock, T. Boone Pickens owner of Clean
Energy Fuels Corporation and BP Capital is perhaps the most famous promoter of a CNG-
powered eet.

As the long-time promoter of the Pickens Plan and the force behind the 2011-proposed NAT
GAS Act that died a slow death in Congress, Pickens dream of a truly massive eet of CNG ve-
hicles on the road has yet to come into fruition.

But the industrys not done trying, yet, as is evident by looking at ALECs records.

ALECs 35-day mailer distributed on June 25, 2014 shows that a model bill on Weights and
Measures and Standards for Dispensing CNG and LNG Motor Fuels will be voted on at the
meeting.

Bills with similar language have already passed in California, Pennsylvania, and Oklahoma,
which the ALEC model is likely based upon. Several of the co-sponsors of the ALEC model res-
olution in Pennsylvania are ALEC members and nearly all of the representatives in all of these
states sit in districts with CNG fueling station infrastructure.

Perhaps unsurprisingly, the original California resolution Senate Joint Resolution 29 was
supported by the California Natural Gas Vehicles Coalition.

Clean Energy Fuels Corporation is a member of California Natural Gas Vehicles Coalition and
the original bill sponsor, Sen. Ted Lieu, oversees the Senate district housing a major Clean En-
ergy Fuels Corporation CNG fueling station. Lieu is a Democrat who has taken a signicant
amount of campaign money from the Clean Energy Fuels and is now running for US Congress.

The CNG industry attempted to push a similar resolution through the National Conference of
Weights and Measures at the annual meeting held in Detroit, Michigan in mid-July, but it did not
pass. Clean Energy Fuels Corporation has a spot on the Natural Gas Steering Committee of the
NCWM.

Winning is the Operative Word

Though unclear if Pickens and Clean Energy Fuels have put the model bill on the table for the
ALEC meeting thats now up for a vote, one things crystal clear: ALEC is a place where corpo-
rations like Clean Energy Fuels, Cheniere, ExxonMobil and others come in order to advance
their bottom line.

As former ALEC Executive Director Sam Brunelli once wrote July 1991 letter to an executive at
the Tobacco Institute, winning is what ALEC is all aboutWinning is the operative
word[W]inning the public policy debate will continue to have a tremendous positive
effect on the 'bottom line' of your company,