Good Business – The Benefits of American Energy
Posted June 23, 2014
It’s hard to overstate the revolution that’s under way in American Energy. In just a few years we’ve gone from a scenario of energy scarcity to energy abundance – thanks in large part to the innovations and investments of America’s oil and natural gas industry. As the White House noted in its May report, “The All-Of-The-Above Energy Strategy as a Path to Sustainable Economic Growth,” dramatic increases in domestic oil and natural gas production have brought jobs, energy security and economic growth. A chart from the U.S. Energy Information Administration (EIA) shows the surge in oil and natural gas employment:
“All-Of-The-Above” is not just a strategy, or a simple catch-phrase. It represents our reality. Analysis by EIA as well as international and private analyses show that oil and natural gas provide the bulk of the energy we use today (62 percent) and will continue to provide the majority of the energy we use for many years to come (60 percent in 2040). EIA’s chart:
That’s because oil and natural gas are available, reliable, portable and energy rich – essential for a prosperous economy and modern living. With new technologies increasing our technically recoverable reserves – oil from shale up 35 percent, natural gas up 38 percent, in 2013 compared to 2011 – America’s oil and natural gas companies are poised to ensure that we have the energy we need for sustainable economic growth.
- In March of 2014 U.S. crude oil production was at its highest level since May of 1988. The International Energy Agency estimates that by next year the U.S. will surpass Saudi Arabia and Russia in crude oil output.
- U.S. natural gas production in 2013 was at its highest level ever.
- U.S. net imports of crude oil and petroleum products in 2013 were at their lowest level since 1988.
- Domestic production satisfied 84 percent of total U.S. energy demand in 2013.
- Electricity and natural gas cost savings from shale energy is saving billions of dollars for the nation’s school districts and state and local governments, according to an IHS study.
- A related IHS study estimates the average American household realized a $1,200 increase in disposable income because of the shale energy revolution, which is expected to grow to $3,500 per household in 2035.
- America’s oil and natural gas industry delivers approximately $85 million on average per day to the federal treasury in rents, royalties and bonus payments.
- The oil and natural gas industry supports 9.8 million jobs or 8 percent of the U.S. economy, contributing $598 billion in labor income and $1.2 trillion to U.S. GDP in 2011, according to PwC.
The numbers are remarkable – all underscoring the oil and natural gas industry’s role as a dynamic, positive engine that is driving our economy forward, creating opportunity for millions of Americans and making all of our lives better.
And yet there are discontents. Instead of celebrating the change in America’s fortunes, some want to end America’s energy revolution and to end our transformation into a global energy superpower. Lacking a plan to provide actual energy to actual people, opponents of the oil and natural gas industry are waging a public relations campaign in an attempt to paint the industry as “risky” and unresponsive to future energy and climate realities.
Again, to the facts:
- Oil and natural gas companies are the largest investors in greenhouse gas mitigation technologies.
- Increased use of natural gas is a leading contributor to the decline of U.S. energy-related emissions from 2005 to 2012, bringing them to their lowest point since 1994.
- The White House’s climate plan depends on further increases in the use of natural gas to supply the energy we need.
- Oil and natural gas companies spend billions every year on improving and securing our energy infrastructure to ensure we have the energy we need to live and grow.
In 1846 a philosopher complained:
“A revolutionary age is an age of action; ours is the age of advertisement and publicity. Nothing ever happens but there is immediate publicity everywhere.”
Well, the energy revolution is happening, and the oil and natural gas industry is constantly in action securing and supplying the energy we’re using today while investing in developing and deploying the energy we will use tomorrow.
According to President Obama, our economy “wouldn’t run very well” if we stopped the production of oil and natural gas. As begrudgingly conceded by The Nation columnist Katha Pollitt, a drastic cutting of greenhouse gas emissions “would cause the world economy to collapse.”
“The environmentally sane standard of living for a population our current size would probably be somewhere between that of the average Englishman and the average Ethiopian…”
Using 2014 numbers that would mean American per capita gross domestic product (at purchasing power parity) would have to fall more than 60 percent. That’s right, 60 percent.
With a goal like that, it’s no wonder that opponents of the industry hide behind rhetoric, dubious reports, advertising and immediate publicity. Instead of attacking our industry, they should say thanks, for much of the energy that makes these efforts, not to mention their global travel, possible.
About The Author
Mark Green joined API after a career in newspaper journalism, including 16 years as national editorial writer for The Oklahoman in the paper’s Washington bureau. Previously, Mark was a reporter, copy editor and sports editor at an assortment of newspapers. He earned his journalism degree from the University of Oklahoma and master’s in journalism and public affairs from American University. He and his wife Pamela have two grown children and five grandchildren.
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