Energy Tomorrow Blog
Posted September 27, 2021
Initiatives in more than two dozen U.S. cities to phase out or straight-up ban natural gas service in new homes and buildings could set up Americans for one heck of a stomach punch. And we’re not just talking figuratively.
The Wall Street Journal reports that several dozen U.S. municipalities, including New York and Denver, have either passed or proposed measures that restrict or ban natural gas in new buildings or those that have had substantial renovation. The gut punch for Americans comes in what that reality would look and feel like – heat pumps and electric appliances in place of natural gas-fueled furnaces, water heaters, ovens and stoves.
Posted September 23, 2021
This week I addressed the Economic Club of Pittsburgh – in the heart of Pennsylvania’s natural gas and oil region – and I talked about the state’s critical importance to the larger U.S. energy picture and the key role our industry plays in meeting the challenge of supplying the energy that powers our nation and also in reducing emissions, toward a lower-carbon future.
Energy has transformed Pennsylvania and continues to do so. Pennsylvania’s natural gas and oil industry directly and indirectly supported nearly a half million jobs across the commonwealth’s economy in 2019. Our industry’s total economic contribution to Pennsylvania ranked among the highest in the nation, with more than $78 billion directed to the state’s GDP – including nearly $41 billion in labor income.
Posted September 15, 2021
We’ve long made the point that natural gas is the essential partner for the growth of wind and solar energy (see here, here and here). You simply must have a partnering energy source, in sufficient quantity, to fuel power generation and maintain reliability when the wind doesn’t blow and/or the sun doesn’t shine.
Just ask Europe and California. Both are experiencing conditions that make this case.
The two also underscore the flaw in policy proposals that exclude natural gas from the future energy mix – as does the Clean Electricity Performance Program (CEPP) now being debated in Congress.
Posted August 10, 2021
We’ve previously noted some of the non-fuel uses of natural gas and oil, many of which were highlighted in a 50-state series from a few years ago. More recently, we posted on the ground-breaking role natural gas and oil play in developing carbon nanotubes, microscopic structures that can be used in any of a number of applications, from electronics to construction.
So, while people commonly think of natural gas and oil as fuels for transportation, generating electricity and heating homes, they are significant in crafting synthetic fabrics, detergents, asphalt, lubricants, some skin care products, and a host of other products. Without oil and gas, you’d find it more difficult to travel on a smooth road (asphalt), launder your dirty clothes, maintain your cars or even keep your skin clear.
Here’s another emerging technology – using a new natural gas technology to make plastics in a process that is more efficient than current processes and could help reduce greenhouse gases.
Posted July 20, 2021
Natural gas and oil are the energy foundation for U.S. economic growth, job creation and the opportunity for Americans to prosper all across the country. This is seen in a new analysis of our industry’s economywide and countrywide impacts: 11.3 million jobs supported in 2019 across all 50 states and the District of Columbia – generating 3.5 additional jobs elsewhere in the economy for each direct industry job, accounting for 5.6% of total U.S. employment; supported nearly $1.7 trillion to U.S. gross domestic product, or nearly 8% of the national total; supported nearly $900 billion in labor income or 6.8% of U.S. national labor income.
The analysis by PwC commissioned by API is based on the latest available government data (2019). Like other industry and business sectors, our industry was hard hit by the economic effects of the 2020 pandemic, but the 2019 data – generated during a period of robust U.S. growth, indicates the importance of the natural gas and oil industry post-pandemic, as the U.S. and global economies and petroleum demand ramp up. The U.S. Energy Information Administration projects (EIA) that 2022 global oil and liquid fuels demand will eclipse 2019 levels.
Given EIA’s forecast, it’s critically important that national policy supports – and doesn’t hinder – domestic natural gas and oil production.
Posted July 15, 2021
As we await the Biden administration’s report on the federal natural gas and oil leasing program, let’s note the welcome news that oil and gas permitting approvals this year are on track to reach their highest levels since George W. Bush was president.
Permitting at that pace is good for near-term U.S. production, no question. In January, when the administration suspended new oil and gas leasing on federal lands and waters, it said permitting would continue, and it has. The country benefits from safe, responsible and robust domestic natural gas and oil production.
Americans shouldn’t conflate permitting and leasing. Drilling permits are issued when companies are ready to develop from acreages, onshore and offshore, previously leased from the federal government. Put another way, leases typically are secured years before development occurs. We’re seeing permits go through at a significant rate because investment and planning have been completed and acreages are ready to go into production. Permitting is about production that’s imminent; leases represent energy in the future.
Posted July 12, 2021
There’s a good deal of discussion in Washington about a national clean electricity standard, which would use government mandates to set targets for reducing carbon emissions from the power sector.
Such an approach is one way to go, but there’s another – one that already has achieved significant greenhouse gas emissions by using the power of the marketplace to effect change: U.S. natural gas.
The increased use of natural gas is the leading reason for reduced U.S. emissions in recent years, including carbon dioxide. At the same time, technologies and industry innovation have helped reduce methane emissions associated with natural gas and oil production, and new advances are on the horizon. This pathway leads to a lower-carbon future and the ability to meet growing world demand for energy.
Posted July 8, 2021
The Biden administration says it is keeping a close eye on the OPEC+ talks on crude oil production because, as White House Press Secretary Jen Psaki said, it wants “Americans to have access to affordable and reliable energy at the pump.”
Unfortunately, the U.S. is mostly a spectator as OPEC+ debates crude oil supply, which continues to be outpaced by demand, putting upward pressure on crude costs. Because the cost of crude is the biggest factor in gasoline prices, U.S. pump prices have reflected this mismatch between demand and supply.
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 June 29, 2021
During a speech to the Houston Economics Club last week, API President and CEO Mike Sommers talked about the United States reaching an “inflection point” in terms of its energy and economic future. Choices made today could have impact far into the future.
As the world’s leading producer of the world’s leading energy – natural gas and oil – the U.S. can choose the market-based approach that over the past decade led to abundant domestic energy, supporting economic growth, reducing reliance on foreign oil and building greater security.
The other choice is the apparent approach of the Biden administration to curtail domestic production of natural gas and oil, swapping their reliability and affordability for aspirational fuels that could take the U.S. back to a period of energy uncertainty.