Energy Tomorrow Blog
Posted July 7, 2021
To serve consumers, support economic growth and help protect the environment, the U.S. needs more natural gas pipeline infrastructure. Last week’s U.S. Supreme Court decision – that states do not have an outsized authority to block federally approved projects from obtaining the land for those pipeline routes – is a significant step forward for those purposes.
The decision underscores the authority of the Federal Energy Regulatory Commission (FERC) under the federal Natural Gas Act (NGA) to review and approve pipeline projects that demonstrate a public necessity and cross state lines, such as the 116-mile PennEast natural gas pipeline from Pennsylvania to New Jersey.
The NGA delegates the federal government’s eminent domain authority to private parties once FERC has approved and certified the pipeline project, which allows those who invest in and build pipelines to have regulatory certainty and a clear permitting process.
Posted July 1, 2021
In recent weeks API Chief Economist Dean Foreman has noted the return of petroleum demand, as economies strengthen in the U.S. and globally, to a level that’s outpacing supply (see here). In the Q&A that follows, Dr. Foreman discusses the impacts of the supply-demand mismatch on American consumers and markets, as well as the consequences of the Biden administration’s energy policy signals.
Posted June 1, 2021
U.S. Energy Secretary Jennifer Granholm continues voicing support for our nation’s pipeline network, which is critically important to Americans’ everyday lives, the economy, national security and environmental progress.Granholm last month said pipelines are “the best way to go” to deliver fuels after a cyberattack disrupted service on the Colonial fuels pipeline. Last week she said her department wants to build more pipes, particularly to transport low-carbon fuels.
Posted May 27, 2021
Posted May 18, 2021
With President Biden in Michigan promoting his $174 billion government plan to boost electric vehicles and charging stations, let’s be clear on three things:
The natural gas and oil industry doesn’t oppose electric vehicles (EVs). To the contrary, a number of API members are involved in developing technologies and infrastructure that support EV adoption.
In the U.S. free-market economy the government shouldn’t push the market and consumers toward a specific policy outcome, with mandates that limit Americans’ transportation choices.
It’s unfair to hit up taxpayers to publicly fund EVs and their charging infrastructure – without regard to whether they own an EV.
Rather, our industry supports the concept that different vehicle technologies that reduce greenhouse gas emissions should be allowed to compete equally for consumer and market acceptance and growth. A hallmark of the U.S. economic system is fair competition, that is determined by the ability of a technology or product to meet consumer needs affordably and reliably.
Posted May 14, 2021
You can read the latest here on Colonial Pipeline’s restoring service on its 5,500-mile line that delivers million of gallons of fuel products every day from the Gulf Coast to New York. The company says the entire pipeline system has been safely restarted and was delivering product to all served markets.
U.S. Energy Secretary Jennifer Granholm said most areas should return to normal this weekend. On its website, Colonial said some markets may experience, or continue to experience, intermittent service interruptions and that “Colonial will move as much gasoline, diesel, and jet fuel as is safely possible and will continue to do so until markets return to normal.” The service station tracker on GasBuddy.com provides updates to specific locations.
While the cyber attack on the pipeline interrupted supplies at numerous retail outlets along the East Coast this week, the incident and response by our industry and associated sectors showed the multifaceted fuel supply system is resilient and works quickly to restore supplies during difficult circumstances – as it has following hurricanes and other unusual events.
Posted April 28, 2021
We’ve written quite a bit recently about how the economic recovery so far has spurred increased demand for oil and refined products (see here, here, and here). The demand for air travel and consequently jet fuel, which historically have related strongly to the pace of economic growth, lagged the economy so far.
In fact, U.S. passenger traffic in April 2021 was roughly half of what it was in 2019, per the Transportation Safety Administration, so many people are asking why ticket prices have already begun to rise. After all, even as summer approaches, aren’t there a lot of idle planes and crews eager to be re-hired and return to service?
There is in fact a lot of idle capacity. Yet, ticket prices also seem to have increased recently and outpaced the return of passengers – for example, with recent price spikes for airfare to some attractive destinations.
Posted April 8, 2021
When President Biden killed the Keystone XL pipeline in January, it was more than just canceling an important piece of energy infrastructure. It was a setback for the U.S.-Canada energy and trade relationship that has benefited both countries economically and in terms of their security in the world.
A new ICF study assessing U.S.-Canada cross-border petroleum trade finds that there is growing integration of North American energy markets, which in turn leads to lower costs for consumers and increased energy security for both countries. Frank Macchiarola, API senior vice president of Policy, Economics and Regulatory Affairs, talked about the study’s findings during a virtual conference hosted by the Canadian Association of Petroleum Producers.
Posted March 17, 2021
One of the great benefits of increased U.S. oil production over the past decade and a half is strengthened U.S. energy security – decreased reliance on foreign oil suppliers and insulation for American consumers against sudden price increases due to geopolitical events, such as the recent attacks on Persian Gulf oil facilities.
Years ago, an episode like that could’ve caused serious alarm in the United States and globally. Yet, the apparent lack of significant or enduring oil price movement following last weekend’s attack shows the tremendous influence U.S. oil production has had on global markets. The same was true after missile attacks on Saudi facilities in 2019 (see here), which substantially reduced Saudi Arabia’s oil exports for a short period. Both events and their aftermath indicate that U.S. domestic production has largely mitigated the price volatility historically associated with serious geopolitical events.
Still, some cautions are in order. First, U.S. energy security can’t be assumed. It takes long-range planning and investments, safe access to domestic resources, the ability to expand pipeline and export facility infrastructure, and a policy-level approach that anticipates unforeseen events that could affect global energy supply and have dire impacts on U.S. security, economic growth, and consumers.
Posted February 18, 2021
More than 4 million Texas homes and businesses have been without electricity this week as an Arctic air mass left the state coping with temperatures hovering around zero. Electricity and natural gas use spiked and rolling blackouts were ordered as energy systems experienced what the Webber Energy Group’s Joshua Rhodes called a “black swan event” that taxed all parts of those systems at the same time.
I spoke with Dustin Meyer, API vice president of Natural Gas Markets, to find out what happened in Texas, to understand the conditions that left the nation’s No. 1 energy state struggling for power and heat and what resources could help prevent this from happening again.
Bottom line points: Texas’ difficulties represent a failure of the grid across the board, with all generation technologies falling short of expectations; as in California last summer, events in Texas underscore the need for a diverse energy supply and smart planning to support the health of the U.S. power grid; natural gas, unique among energy sources in supplying needed attributes that ensure grid reliability, is and will remain a key in that diverse mix; and natural gas has carried most of the energy load in Texas this week, and without its contributions the energy picture would have been even worse. Expanded infrastructure would help make natural gas systems more resilient.