For Streamlining Energy Infrastructure

Mark Green
Posted July 18, 2017

Current legislation in Congress will be a big help in advancing the energy infrastructure the United States needs to connect our nation’s vast energy wealth with those who benefit from it: individual Americans, businesses and manufacturers.    

The House legislation would streamline federal review and approval of natural gas pipelines by codifying and reinforcing current regulatory deadlines and by clarifying the roles of the permitting agencies that are involved in infrastructure projects. API President and CEO Jack Gerard, in a recent letter to House leaders:

Ensuring we have a robust energy infrastructure system that keeps pace with growing production and demand is essential to helping American families and businesses have reliable access to affordable energy. … Whether it is powering our nation’s electricity grid, delivering natural gas to heat homes and run appliances, supplying raw materials and energy to industry and manufacturing, or delivering the transportation fuels we use every day, this investment will ensure that these critical products are there when and where they are needed most.

American energy represents tremendous opportunity for our country. According to a recent study by ICF, we have the abundance of natural gas and oil reserves that would support up to $1.34 trillion in private investments through 2035 in a broad array of infrastructure: pipelines, refining and oil products transport, surface and lease equipment, gathering and processing facilities and storage and export terminals.

Infrastructure development would add up to $1.89 trillion in contributions to U.S. GDP through 2035 and support, on average, up to 1.047 million American jobs annually, the IFC study estimated.

This infrastructure would facilitate broad economic growth associated with energy. Another ICF report found that the lengthy value chain of U.S. natural gas reaches all 50 states, supporting millions of jobs and supplying billions to the economy. Safe and responsible natural gas development will continue to benefit the country for decades to come, ICF projects, including:

• Total end-use cost savings of $100 billion by 2040 – or $655 per U.S. household – could be realized with increased supply of natural gas.
• Total added value from direct, indirect and induced activities and jobs throughout the economy could grow to more than $1 trillion in 2040.
• Jobs growth from about 4 million non-agriculture jobs in 2015 to between 5.2 million and 5.9 million by 2040.

Accompanying economic growth and consumer benefits associated with natural gas are climate benefits. Primarily because of increased natural gas use, U.S. energy-related carbon dioxide emissions are near 30-year lows:

The emergence of natural gas, which was the leading fuel source for electricity generation in 2016, is key to a market-based approach that supplies key energy needs while protecting public health and the environment.

So we circle back to legislation to streamline approvals of additional infrastructure to deliver energy that provides these benefits. This should be lawmakers’ focus, avoiding issues that could undermine the legislation’s core intent, such as provisions that would dictate the source of pipeline materials. Timely, efficient construction of pipelines in the U.S. depends on reliable, available supplies of line pipe and other materials – the disruption of which could delay projects, impacting energy, jobs and the economy. Likewise, the legislation should not make it more difficult to site projects to serve the greater public good.

Finally, we’ll again encourage the Senate to move on the administration’s nominations to fill vacancies on the Federal Energy Regulatory Commission (FERC), which has lacked a quorum to conduct official business on a range of issues, including the siting and permitting of natural gas pipelines. Last week the president nominated Kevin McIntyre to head FERC. The previous nominations of Neil Chatterjee and Robert Powelson await full Senate confirmation. Senators should act as quickly as possible to restore FERC’s quorum so that it can play its important role in advancing energy infrastructure.