Category Archives: Energy

Coal is Bankrupt: Who’s Left Holding the Bag?

The American coal industry has collapsed. This is not hyperbole.

In the last few years, at least 28 coal companies have gone bankrupt and 264 mines have closed. The suffering extends from the smallest companies to the behemoths. Those that haven’t gone bankrupt are trading at small fractions of their values of just five years ago, when the U.S. Coal Sector Index stood at $481. On Friday, the index closed below $32, a loss of more than 93 percent in value.

Peabody lost almost all its value over five years before bankruptcy

Peabody lost almost all its value over five years before filing bankruptcy

And last week, the largest US coal producer joined the march into bankruptcy court. Peabody Energy, the St. Louis-based coal giant cited “a dramatic drop in the price of metallurgical coal, weakness in the Chinese economy, overproduction of domestic shale gas and ongoing regulatory challenges,” as the reasons for its bankruptcy filing. Peabody joins Arch CoalAlpha Natural Resources, Walter Energy and Patriot Coal among American coal giants that have filed for bankruptcy in recent months.

In 2009, Peabody’s stock traded at $718 per share. Today, you can pick up a share for 73 cents – a loss of 99.9 percent. Too bad for shareholders. Looks like they’ve lost a bundle. But who else is losing? And how did this all happen?

It isn’t the “war on coal”

Did you notice Peabody’s bankruptcy statement? They blamed the drop in coal prices, weakness in the Chinese economy and too much cheap natural gas. Oh, and yes, they threw in “ongoing regulatory challenges” as a fourth culprit – but only after citing the massive structural changes affecting the coal industry. Here’s the most obvious fact: Natural gas, a cleaner substitute for coal, is very, very cheap. Back in 2008, natural gas ticked above $12 per thousand Btu’s (MMBtu). But in Chicago last week, traders bought and sold gas at $1.92 per MMBtu, a small fraction of the price seven years ago. At these prices, almost nobody is building new coal plants when they could generate electricity with gas, solar or wind.

Coal Moratorium

Bankrupt coal companies have left behind enormous reclamation and cleanup liabilities

Sure, you’ll hear candidates for Congress complaining about Obama’s climate initiatives, or EPA regulations. True enough, in the long run, everyone knows that coal will have to start paying its health and environmental costs.

But the politicians seldom mention this fact: The industry is going belly-up BEFORE any of the Administration’s regulatory actions have taken place. The EPA enacted rules a few years ago to make sure coal plants didn’t emit too much mercury pollution that poisons children; but the Supreme Court blocked the rules last year. And the hotly-debated Clean Power Plan, the centerpiece of Obama’s climate program, is also on ice, thanks again to the Supreme Court. Even if the EPA gets the green light, no state will have to submit any plans before 2018.

And yet, the coal industry has already fled en masse to the safety of bankruptcy, long before government action will force them to clean up their act.

Then what happened to these guys?

We don’t minimize the collapse of coal and gas prices worldwide, and the virtual disappearance of Chinese demand. But there’s so much more. First, virtually all the big coal miners layered on mountains of debt to finance enormous acquisitions in recent years. Alpha Natural Resources bought rival Massey Energy for $7 billion. Arch Coal bought International Coal for $3.4 billion. Peabody paid $5.1 billion for MacArthur Coal. And Walter Energy bought Western Coal for $3.3 billion. And what did they get from the feeding frenzy? Lots of coal reserves that few people really want these days. But the debts are coming due, and they simply can’t pay.

Second, the coal industry faces structural changes that have sent bankers and investors packing. The sustained glut of natural gas has encouraged utilities to build gas-fired power plants, a move that locks in the natural gas advantage over coal. In 2013, for example, natural gas represented more than 50 percent of new power generating capacity in the United States. Coal accounted for just 11 percent, putting it a distant third, behind solar (22 percent) and only slightly ahead of wind (8 percent).

Natural gas prices continue to fall, undermining coal markets

Natural gas prices continue to fall, undermining coal markets

And even though coal still has the lion’s share of overall electric generating capacity, U.S. coal-fired power plants are aging, and many are nearing the end of their useful lives. Without new plants, coal demand is destined to plummet. And there are very few new plants.

Third, these changes pale in comparison to the sea change in public thinking. Whether it’s mercury, or greenhouse gases, or sulfur oxides or acid runoff, the American public is waking up to the reality that coal pollution is too expensive for the public to bear in the name of private profits. Whether or not the Clean Power Plan or EPA mercury regulations survive in their current form, no serious observer can imagine a future in which coal plants pollute the world and jeopardize its climate systems, all for the sake of their own profits. In fact, the whole world has confirmed this reality by agreeing to the terms of the Paris Treaty, under which every country will make substantial cuts in climate-warming emissions. Coal, everywhere, will have to remain in the ground.

Uber-financier Goldman Sachs sums up these changes in a brilliant nutshell. They declared in January that it’s time to slowly ease coal out of the energy mix, with a friendly pat on the head for all the good it did for the U.S. economy. “Just as a worker celebrating their 65th birthday can settle into a more sedate lifestyle while they look back on past achievements,” the report noted, “we argue that thermal coal has reached its retirement age.”

So, who picks up the tab?

Bankruptcy is not death. Companies don’t file under Chapter 11 as some sort of final act before breathing their last. They use the courts to gain relief from their obligations to shareholders, creditors, employees, retirees and the public. They can’t afford to pay everything they owe, so the court determines who loses, and by how much. In theory, the rehabilitated companies emerge with a new lease on life. They can’t pay, so others absorb the cost.

In the case of bankrupt coal, who pays?

Well, for starters, you do. Not you alone, mind you. In West Virginia, 120,000 retired miners and their families could lose their pensions and health care – for many their only source of income. But you’re caught in the mix as well. That’s because it costs enormous amounts to clean up the toxic mess that coal mining leaves behind. You’d think that Federal and state governments would compel coal companies to reclaim their strip mines and shattered mountains as they go, but it doesn’t happen that way. In Montana, North Dakota and Wyoming, there are 450 square miles of land torn up by mining; but only 10 percent has been reclaimed.

This means that the coal companies have put off for another day the cost of reclamation. For bankrupt Peabody, the cost is estimated at $1.4 billion. For bankrupt Arch and Alpha, it’s $485 million and $640 million, respectively. And in bankruptcy, they will shed these liabilities for pennies on the dollar. These abandoned wastes cannot be left alone. They’re ugly, yes. But they’re also perpetual sources of water pollution, slowly leaking acidic and otherwise toxic wastes into streams and groundwater supplies.

Moonscapes left behind by mountaintop removal cost billions to reclaim

Moonscapes left behind by mountaintop removal coal mining cost billions to clean up

And so you will pay, as a federal and state taxpayer. For these three companies alone, your share is about $7. Another $7 for your spouse, your mom, each of your kids, your neighbors. Everyone in the country gets to chip in $7 to clean up the mess left behind by just three coal companies. Did I mention that 28 of them are in bankruptcy?

Now, you and I may think that this is scandalous. But actually, this is standard operating procedure for the coal industry. In the best of times, the U.S. coal industry leaves enormous costs for everyone else to pick up – sometimes called “external costs.” These include things like respiratory diseases, toxic mercury levels, ocean acidification, climate-altering greenhouse gas concentrations, and the effects of drought and flooding.

Until 2010, we didn’t really know the scale of these costs. That’s when the U.S. National Academy of Sciences produced a study called The Hidden Cost of Energy: Unpriced Consequences of Energy Production and Use. Its findings were shocking. Coal burned in a single year by U.S. power plants costs everyone else on the planet another $200 to 300 billion in “external costs.” That’s billions, with a “B”. And it amounts to a tax of about $30-40 levied on every human on Earth. Only for U.S. coal. Only for one single year.

So if you’re following the news, watch carefully in the year ahead as the American coal industry winds its way through bankruptcy. When it’s over, you and I will be a bit poorer. But until we summon the resolve to leave coal unburned, all of us will continue to bear enormous external costs, arising not only from coal’s nominal “failure,” but from their normal levels of success.

Isn’t it time we get to work on ways to leave it in the ground?

The Iowa Caucus & the Story of Farmer Dog

Now that the Iowa Caucuses are over, the rest of the country might want to know about the Renewable Fuel Standard, that healthy-sounding thing that almost all the candidates from both parties swore to enforce (while campaigning in Iowa, of course). Here it is in terms you can read to your kids. It was written in 2011, and some things have changed since then. But the basic story line is as true as ever:

In a faraway country called Cornlandia, there lived a dog named Farmer Dog.  Farmer Dog was a free dog.  He depended on nobody, and he liked it that way.  He drove his tractor when he wanted to, and he plowed his ground when he wanted to.  He was a free dog.

Farmer Dog on his tractor

Farmer Dog on his tractor

One day, his neighbor told Farmer Dog that he wasn’t as free as he thought.  The gasoline that he used to fill his tractor was bought from a bad duck named Qadaffy, who lived in a foreign land.  Qadaffy Duck pumped oil from deep beneath his ground, and put it on a ship that sailed to Cornlandia.  Recently, Qadaffy Duck had been charging more and more and more for his oil.

Qadaffy Duck had the oil that Farmer Dog needed, so he wasn’t really free.  This made Farmer Dog mad.

But Farmer Dog was a resourceful dog.  So he decided to make his own gasoline out of something that he could grow in Cornlandia – CORN.   It wasn’t really gasoline.  It was called Ethanol.  But Farmer Dog could make plenty of Ethanol.  All he had to do was grow plenty of corn.

Qadaffy Duck sold Farmer Dog the oil for his tractor

Qadaffy Duck sold Farmer Dog the oil for his tractor

So Farmer Dog climbed onto his tractor to plow the ground and plant the corn.  But there was a problem:  he had no gas in the tank!  Farmer Dog was a resourceful dog.  Even though he was mad, Farmer Dog asked Qadaffy Duck for ten buckets of oil for his tractor.  It took one bucket of oil to run the pump, and Farmer Dog went away with nine buckets.  But crude oil isn’t gasoline, so Farmer Dog went to a neighbor who could turn the remaining oil into gasoline.  It took another bucket of crude to run the refining machine, and Farmer Dog went back home with eight buckets of gasoline.

He poured four of those buckets into his tractor, and it roared to life, plowing the soil, planting the seeds, cultivating the ground, and harvesting the mature corn.  When he was done, his wagon was full of bright yellow corn, but the four buckets of gasoline were used up.

He took the corn to the distiller and asked him to make it into Ethanol, so he could be free from the evil Qadaffy Duck. The distiller needed Farmer Dog’s last four buckets of gasoline to run the distilling machine.  Now the last of the gasoline was all gone.  Farmer Dog watched as the distiller worked.  Ethanol poured from his machine, bucket after bucket!  When the distilling was finished, there were eighteen buckets of Ethanol, which Farmer Dog happily took home.

But there was a problem.  The Ethanol didn’t provide as much power as Qadaffy Duck’s gasoline.  It was about one-third weaker!  Farmer Dog was not happy.  All this work to be free from Qadaffy Duck’s oil, and only enough Ethanol to equal about 12 buckets of gasoline: only two more buckets than the ten he had bought from Qadaffy Duck to start with!

All that work and all that cost to gain only two buckets of fuel!

Farmer Dog was not happy, but he was a resourceful dog.  He had an idea: What if he could get the people of Cornlandia to give him a little extra money for every bucket of Ethanol he made with his corn? Better yet, what if he could make all his neighbors buy a little of his Ethanol to mix with their gasoline?  Then, maybe it would be worth it.

Off he drove to visit Governor Mutt, Cornlandia’s top dog.  The Governor thought Farmer Dog’s idea was brilliant, and he made all Farmer Dog’s neighbors give him extra money for every bucket of Ethanol he made.  He also made them all buy a little of Farmer Dog’s Ethanol to mix with their gasoline.

Governor Mutt made everyone buy Farmer Dog's ethanol

Governor Mutt made everyone pay for Farmer Dog’s ethanol

Farmer Dog was happy, and he made more and more Ethanol, since everyone had to buy some.

But there was a problem.  Farmer Dog’s neighbors were not happy at all.  The corn they had once bought to feed their chickens and dairy cows was now gone for Farmer Dog’s Ethanol.  Now the chickens laid no eggs, and the cows gave no milk!  They had to buy Farmer Dog’s Ethanol.  And worse yet, they had to pay Governor Mutt’s tax for every bucket he made from his corn!

Farmer Dog was selling so much Ethanol that he needed more and more gasoline to run his tractor and the distilling machine.  Qadaffy Duck sold him all the oil he needed.  Qadaffy didn’t seem to be such a bad duck any more.

And Farmer Dog and Qadaffy Duck lived happily ever after.

** THE END **

Ethanol graph

 

 

 

 

Note to reader:  I actually made this story up.  But here are a few actual facts for you (current as of 3/2011):

FactWorld corn prices have increased by 73% since June 2010, according to a World Bank January 2011 report.

FactAccording to the World Bank, rising global food prices swelled the numbers of those in extreme poverty by 44 million souls last year alone – people living on less than $1.25 per day.

FactA 2008 report by the World Bank attributed 70-75% of the world food price rises to subsidies for biofuels like corn ethanol.

FactOne tankful of ethanol consumes more than enough corn – 8 bushels – to feed one African person for an entire year.

Fact34.9 percent of the U.S. corn harvest went to make ethanol last year, almost as much as for animal feed. This year, about 36 percent of the American corn harvest will be ethanol.

FactU.S. acreage to grow corn for ethanol last year was as big as the entire state of Ohio, or Virginia or Tennessee.

FactU.S. law requires the use of ethanol in fuels:  13.2 billion gallons of it last year.

FactAmerican taxpayers paid $23 billion in taxes or government deficits last year because of subsidies for corn ethanol. The Congressional Budget Office reported that the cost to U.S. taxpayers from ethanol subsidies totaled $1.78 per gallon of ethanol produced.

FactWhile researchers disagree on the exact number, they all agree that making ethanol uses a lot of fuel.  Some argue that it uses more fuel than the actual ethanol produced.  But even the most optimistic admit that for every unit of ethanol produced, you have to consume at least two-thirds of that amount in petroleum.

FactIf we used all the corn grown in the U.S. for nothing but ethanol, we would only satisfy 12% of our gasoline demand.  But if we count the petroleum used to make the stuff, we would only have about 3% more fuel – and no corn at all for that old-fashioned practice … eating.

Why do you spend your money for that which is not bread, and your labor for that which does not satisfy? Listen diligently to me, and eat what is good, and delight yourselves in rich food.   Isaiah 55:2

Thanks for reading, and may God bless you.

Keystone: Don’t Like This Senate? Buy Yourself a Better One

Two notable facts come into focus as the U.S. Senate today came within a whisker of forcing through the approval of the Keystone XL pipeline – linking the Alberta tar sands petro-moonscape with warm-water U.S. export terminals in Texas. First, the Koch Brothers are revealed to be the largest non-Canadian owner of tar sands mineral rights, holding acreage the size of the state of Delaware. Second, those same Koch Brothers are estimated to have spent roughly $300 million to influence U.S. Congressional elections this year.

That’s roughly $300 in political spending for every acre of tar sands oil they own.

When you think about it, that’s a pretty small investment for so much oil.

The Washington Post reports today: “You might expect the biggest foreign lease owner in Canada’s oil sands, or tar sands, to be one of the international oil giants, like Exxon Mobil or Royal Dutch Shell. But that isn’t the case. The biggest non-Canadian lease holder in the northern Alberta oil sands is a subsidiary of Koch Industries, the privately-owned cornerstone of the fortune of conservative Koch brothers Charles and David. The Koch Industries subsidiary holds leases on 1.1 million acres — an area nearly the size of Delaware — in the oil sands region of Alberta, Canada.”

And during the election season, The Huffington Post reported: “The billionaire Koch brothers and their political network are planning to spend almost $300 million during the 2014 election cycle, some of which will go toward a renewed effort to combat unprecedented carbon regulations unveiled by the Obama administration last month.” Of course, the exact amount can’t be known, because U.S. law permits the Kochs and others to keep most of their spending secret.

Tar sand petro-moonscape. Courtesy of Sierra Club Canada

Tar sand petro-moonscape. Courtesy of Sierra Club Canada

If your business plan called for the destruction of more than a million acres of boreal forests, digging out vast mountains of tar-soaked soil, wringing out a killing in oily bitumen, and leaving behind indigenous peoples  awash in enormous lakes of toxic sludge, wouldn’t $300 per acre seem like a small price to pay? Especially if the Congress you purchased was willing to force its farmers and ranchers to give you a pipeline right-of-way through the heart of its breadbasket?

We continue to pray for justice for the victims of tar sands oppression. Today, those prayers test our faith in new ways, as the rich and powerful flex their muscles in Congress. Lord, open our eyes to see the true Sovereign of this world, with eyes unclouded by the many pretenders who claim it as their own.

“Behold my servant, whom I uphold, my chosen, in whom my soul delights; I have put my Spirit upon him; he will bring forth justice to the nations…. He will not grow faint or be discouraged till he has established justice in the earth; and the coastlands wait for his law.” (Isaiah 42:1, 4)

Climate Peril: Denmark Leads, the US Retreats

Two articles in today’s paper cast in sharp relief the major crisis facing God’s Creation today, as we struggle with the unfolding threat of global climate change. One tiny country – Denmark – has made so much progress in developing sustainable energy that they are facing complexities such as excessively cheap electricity. In the other, a newly-elected American congressional majority is swearing to kill the only significant national climate initiatives underway in the country.

Denmark emits 9.8 tons of CO2 per person every year. But the average American more than doubles that level, with a whopping 19.7 tons of CO2 emissions per year. The overall difference, however, is enormous: there are only 5.6 million Danes, compared to some 310 million Americans. Whatever leadership the Danes exhibit, it is overwhelmed by American negligence and gluttony.

Wind provides 28% of Denmark’s electricity (Danish Wind Industry Association)

So what’s going on in Denmark? Well, they have already achieved 40 percent renewable power on their electric grid, and plan to be at 50 percent in six years. More amazingly, they plan to use no fossil fuels whatsoever by 2050: none for the electric grid, none for transportation, none for heating and cooling. None.

And the US? Our wind, solar and geothermal power accounts for a modest 6 percent of our consumption (with another 7 percent coming from legacy hydroelectric dams). It seems that our policy is now driven by worries about the plight of the tiny handful of coal miners living in the state represented by the new Senate Majority Leader. Even if it kills the planet’s natural systems, those Kentuckian miners, and – much more importantly – their bosses and lobbyists, are not going to lose a single job. No mention of the fact that there are four times as many American solar, wind and geothermal workers today as there are coal miners.

In Denmark, they’re developing smart appliances that talk to the power grid and cut back when electricity is expensive, but run full blast when there is abundant wind or sunshine; and they’re adjusting electricity prices by the hour to provide incentives to consume power when sustainable sources are most available.

In the US, all the talk is about ramming through approval of the massive Keystone XL pipeline which will carry carbon–heavy Canadian tar sands oil to export refineries in Texas. Canadian oil companies will profit; unspeakably wealthy multinational oil exporters will profit; but American Midwesterners will watch nervously as nearly a million barrels of highly pressurized, corrosive tar sands oil course through their precious aquifers every day – all while the cynical claims of pipeline jobs are repeated by politicians, despite having been debunked repeatedly.

In Denmark, they have a Climate czar, who coordinates their response to the defining global crisis of our century. In the US, we have an Ebola czar, after one person died of the disease.

In Denmark, they worry about electricity becoming so cheap that gas-fired plants will go out of business, even if they might be needed for standby power on windless nights.

In the US, Congress is vowing to prevent the EPA from enforcing the Clean Air Act carbon standards on coal-fired power plants. If they prevail, then the American skies will continue to be used as an unlimited, free dumping ground for coal and gas soot and smog, as though the air belongs to the drillers and refiners, and not to every human and other creature on God’s earth.

Creation-care advocates in the Christian church surely wonder what judgment awaits these two countries, as global climate systems spiral out of control, as oceans become dangerously acidic, as growing seasons in poor countries suffer waves of drought and flooding, and as extinctions of threatened species run at thousands of times historical levels.

Two-thirds of Americans stayed home on Election Day last week. And perhaps many of those non-voters might have agreed that Denmark’s play-book looks smarter – and possibly more Christian – than ours. But that’s a largely academic question, now, isn’t it?

“O let the nations be glad and sing for joy: for you judge the peoples with equity, and govern the nations upon earth.” (Psalm 67:4)

Clean Wind Electricity for Your Home

It seems the landscape for national and global climate policy just changed pretty significantly this week, didn’t it? With the new Senate leadership, efforts to kill climate-friendly policies are already in gear. And “greatest-hoax” climate denier Sen. James Inhofe is set to take the reins of the Environment and Public Works Committee.

From one point of view, US environmental policies are now largely in the hands of the man who has written: “I stood alone in saying that anthropogenic catastrophic global warming is a hoax.” Not the National Academy of Sciences, or the EPA, or the American Geophysical Union, or the American Meteorological Society – but James Inhofe, who claims that the 97 percent of the world’s climate scientists have simply conspired to pull the wool over the eyes of mankind.

Now, maybe this makes us mad. Maybe we’re depressed. Maybe we’re ready to give up.

Switch your home electric from coal to clean wind!

Switch your home electric from coal to clean wind!

Well, if so, maybe it’s time for us to actually DO something about it. Here’s a suggestion: Let’s stop complaining about oil-funded politicians complicit in the abuse of God’s creation, and take action ourselves. And here’s one big – and easy – thing we can do: SWITCH FROM DIRTY COAL TO WIND ELECTRICITY FOR YOUR HOME RIGHT NOW.

I just did it, and it was simple. Some of you know that solar PV provides lots of our electricity here at Good Hand Farm. Eight years ago, we installed panels that basically run the farm, and that provide about half of our house needs. Earlier this year, we took advantage of an essentially free program to solarize two of our neighbors’ homes.

But the balance of our electric needs – not covered by our solar production – was still filthy. The power we had to buy from our New Jersey utility (JCP&L) comes from coal (43%) and gas (17%) – that’s 60% from fossil fuels. And most of the balance is nuclear.Picture1

So instead of just fuming about oil-funded politicians running congressional policy, I decided to do something. With a few clicks – and one phone call – I found a 100% wind-power producer that my utility accepts, and made the switch. There were a range of options and prices, but I like the choice I made. My previous dirty electricity cost me 9.63 cents per kWh. My new provider, Stream Energy, charges 9.98 cents, fixed for one year.  That might run me about $2.00 per month more than I was paying for coal. Nothing changes on my bill, and my electric utility continues to service everything just as before.

Except for one thing: We no longer use any fossil fuels and greenhouse gases to power our home and farm.

Want to give it a try? Details will vary depending on where you live, so go to this page to find out who covers your area. And if you want to try the choice I made, then just click here, and then choose the “Enroll-Now” option. (If enough of you go this route, I’ll start to get further savings on my bill, and then you can do the same thing with your friends.)

And in the bargain, maybe you can look in the mirror tomorrow, and stand a little taller. Maybe our politicians are bent on the unfettered abuse of our Father’s world, but you don’t have to follow them.

You are not powerless. It may feel that way sometimes, but you can affect what happens on God’s good earth. Take the step, and join me on the road to a cleaner, more sustainable world.

Cheery Energy Ads? Look Out!

I force myself to listen. Believe me, it’s not easy. The mute button is right there, and I could spare myself the indignity. And yet I grit my teeth, and listen to the peppy music, watch the smiling faces, and follow the actors portraying happy American energy workers telling us how good it all is.

Of course, we’re talking about those oil, gas and coal ads that permeate the news-hour airwaves. First, it was the “Clean Coal” people touting a carbon-capture technology (that actually didn’t exist at operational scale). Then it was ExxonMobil telling us how clean their Canadian tar sands operations were (I’ve been there, and the scale of pollution is terrifying). Next came the natural gas people telling us how smart and safe it is for America to inject toxic chemicals below our aquifers in the current fracking boom. And permeating them all, that lovely promise of jobs, jobs and more jobs.

And finally, there is BP.

BP, those wonderful people who brought us the Deepwater Horizon disaster in the Gulf of Mexico. They’re still not finished blanketing the airwaves with those “Look! All better!” ads. “Today the beaches and Gulf are open for business,” says the narrator, “and many areas are reporting the best tourism season in years!”

Maybe we’ll forget that in May 2010, BP fouled much of the immense Gulf of Mexico, in the worst oil spill in the history of the petroleum industry. BP’s Deepwater Horizon drilling rig blew up, killing eleven workers and opening a deep-water oil gusher that flowed unabated for 87 days. An estimated 219 million gallons of oil escaped into the Gulf waters, followed by 1.84 million gallons of chemical dispersants which may have been even more damaging. Crude oil from the blowout has been found as far away as Tampa Bay.

In the wake of the disaster, BP pled guilty to criminal charges, and to two felony counts of lying to Congress. The company was fined a record-setting $4.52 billion in fines. And the company was forced to set aside a total of $42.2 billion for cleanup and damages to people and businesses.

But you’d never know it from the ad campaign, would you? “Two years ago, the people of BP made a commitment to the Gulf, and every day since we’ve worked hard to keep that,” says one ad. “I want you to know that there’s another commitment that BP takes just as seriously – our commitment to America.”

It all sounded so nice.

But the U.S. District judge presiding over a suit under the Clean Water Act apparently wasn’t swayed by the ads. Yesterday, Judge Carl J. Barbier found BP guilty of gross negligence and willful misconduct in the blowout, exposing BP to as much as $18 billion more in civil penalties on behalf of victims. In a 153-page decision, Judge Barbier recounted “a chain of failures” – including skimping on safety tests and dishonest analysis of results – resulting in the explosion and spill.

There is still much that remains unknown about the effects of BP’s actions in the Gulf. Some cite evidence that the well is still leaking. Others point to mortality of baby dolphins, which increased by a factor of ten after the spill. Oil-related carcinogens in the Gulf have increased by a factor of 40, with unknown impacts on humans and marine life. Deep coral reefs have suffered significant damage, with largely unknown impacts on ocean ecosystems. Many of us have been to the Mississippi Delta to witness first-hand the damage to local fishing communities. It may be many years before we really know the true cost of the BP Gulf spill.

But one thing that we can know beyond doubt it this: All those cheery fossil-fuel ads have had only one purpose—to mask the extent of the damage and the ongoing risks of tar sands mining, fracking and mountaintop removal coal. And now, ever more clearly – of deep-water oil drilling.

It’s up to you whether you hit the mute button on those commercials or not. But I suspect that, whatever they’re saying this time around, we should take it with a huge grain of salt.