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Jack Gerard's Speech at The Governor's Utah Energy Summit, 2017

As prepared for delivery

Jack N. Gerard

The Governor’s Utah Energy Summit: Governor’s National Energy Panel

May 4, 2017

I want to thank Governor Herbert for hosting this event again this year and for his steadfast commitment and leadership in advancing all forms of energy development in Utah and across the nation.

You and other like-minded governors and other elected leaders, from both parties, understand that getting energy policy right means a brighter future for the nation's economy and the environment.

Our country's rise to global energy leadership has been primarily fostered in the states through smart, forward-looking policies that promote responsible energy development, protect the environment and workers and spur economic growth. 

President Trump appears to be taking a similar approach to energy policy. He and his team understand that a strong, prosperous and secure America is built on long-term domestic energy abundance, reliability and security.

He has signaled, through his early actions, a new direction for energy policy that embraces a true all of the above approach based on respect for the role that markets play in innovation and on doing what’s best for the consumer.

The hard work, innovation and core commitment to safety by the millions of women and men who work in the industry are what led to the improvement of America’s energy landscape and outlook.

Now, at the federal level, we have a better partner that will help to continue the United States’ positive energy trajectory.

No one would have predicted our nation’s positive transformation a decade ago, which was achieved in the face of a regulatory onslaught that discouraged fossil fuel development.

And those policies have consequences. Let’s consider a few important facts that illustrate the impact of federal energy policy/regulation on Western states. 

  • Nationally, oil and natural gas production have declined nearly 12 percent on federal lands since 2008 – compared to an 82 percent increase on state and private lands.
  • From 2008 – 2015, according to BLM, drilling permits on federally controlled onshore land dropped by 47 percent and the actual number of wells drilled dropped 68 percent. 
  • In stark contrast, on private and state lands, oil production is up 115 percent, and natural gas production is up 66 percent, from 2008 to 2015.

All of which demonstrates that this disparity is not due to geologic differences but due to political decisions made in Washington D.C. 

Today, federal energy policy places a vast majority of the federal government’s land off-limits to responsible energy development.

For example, only about 15 percent of land controlled by the Bureau of Land Management is open to energy development.

And offshore, 94 percent has been placed off limits –although just last Friday President Trump issued an executive order that directs “It shall be the policy of the United States to encourage energy exploration and production, including on the Outer Continental Shelf, in order to maintain the Nation's position as a global energy leader and foster energy security and resilience for the benefit of the American people.”

The executive order’s goal to “[P]ut the energy needs of American families and businesses first and continue implementing a plan that ensures energy security and economic vitality for decades to come,” is an important and significant shift in tone and direction for the federal government.

The issuing of this executive order and other early actions by the president are helping to redirect the nation's energy policy and reversing policies that needlessly hinder domestic energy development.

Since taking office, of the 27 executive orders issued in his first 100 days in office, six directly address the need to promote the development of America’s vast energy resources, including an executive order that reverses the previous administration’s rejection of the Keystone XL and the Dakota Access Pipelines; withdrawing executive branch actions that needlessly constrain domestic energy development and provide little benefits to consumers or improvements to the environment such as the Clean Power Plan and reversing the decision to restrict energy development in most of the Arctic.

For its part, Congress has taken the rare step to pass Congressional Review Acts to stop rules put into place during the closing days of the previous administration that hinder economic growth and domestic energy production.

President Trump, his team, and congressional leaders reject the notion, offered by some that we have to make a choice between growing our economy, expanding energy development and use and continuing to improve the environment.

We don’t. Because today we’ve achieved all three simultaneously, which is another facet of the America’s 21st-century energy revolution. 

According to the EPA, greenhouse gas emissions from electricity generation are at their lowest point in 30 years even as electricity demand rises.

And our nation’s best-in-the-world refineries are producing advanced, cleaner gasoline and diesel fuels. A good example is the decision by the local Chevron and Tesoro refineries, spurred by the leadership of Gov. Herbert and state lawmakers that incentivize the production of Tier 3 fuels right here in Utah.

These world-class facilities in Utah and across the nation, in combination with more fuel-efficient vehicles, have reduced U.S. air pollutants by 70 percent since 1970; even as vehicle miles traveled have increased by more than 170 percent.

For the first time since America’s 21st century energy revolution began, the regulatory direction of our nation emphasizes partnership and collaboration rather than confrontation with industry.

Facts and market realities will guide policy discussions, including the recognition that according to most experts we’ll need more energy from all sources for decades to come. 

In 2040 the Energy Information Administration projects that oil and natural gas will supply 60 percent of U.S. energy needs even under the most optimistic scenarios for renewable energy growth.

What’s more, they project that worldwide energy consumption will increase by 48 percent by 2040 and that 78 percent of that will be met by fossil fuels.

However, there are those that have a contrarian vision and to severely restrict or stop fossil fuel development entirely. 

The fact is energy policies that seek to constrain or to stop domestic energy production are, in reality, anti-consumer and could dampen future economic growth and make America energy insecure once more.  

That’s the conclusion of a study API commissioned that examines the real world impacts of a “keep-it-in-the-ground” national energy policy.

In short, the average American family would pay more for the energy and products they rely on every day.

The study estimated that by 2040 the average American household could see an annual increase of almost $2,000 in their energy bill.

If you factor in the “hidden” energy costs that include other goods and services whose price is affected by energy costs, the increase more than doubles to $4,550 in 2040. 

It could also mean a cumulative loss of $11.8 trillion in the nation’s GDP through 2040 and the loss of almost 6 million jobs in 2040.

In contrast, America's energy abundance has lowered energy costs for consumers. According to reports, the average American household saved as much as $1337 due to lower utility costs and other energy-related savings in 2015. In addition, AAA reports that American drivers saved as much as $550 in transportation fuel costs.

The 21st century energy renaissance has given us a once in a generation opportunity to address some of today's most pressing issues, including creating middle-class jobs, tackling income inequality, ensuring sustained affordable energy for consumers and enhancing our national security. 

Ultimately, the question before us is not if we have the energy we’ll need, or the means and methods to safely and responsibly, develop, transport, store and refine it. We do.

The question is whether we have the vision to work together, beyond political labels or partisan mindsets, to advance policies that promote the safe and responsible development of our nation's vast energy resources to benefit the American consumer, the economy, and the environment.

I would suggest that we should look no farther than North American energy, developed, transported and refined by Americans to help meet the world’s ever-growing need for energy, and in doing so create economic growth, opportunity and prosperity for families and communities in every region of this nation.

In the coming weeks, months and years we want to create a new American understanding of energy -- and with it a national energy policy – based on science, respect for the free market and the entrepreneurial spirit of the nation’s workforce.

Now is the time to set aside the acrimony and division that has marked too much of past national energy policy discussions.

And instead work together, with the states at the lead, at all levels of government, without regard to party, region or political outlook on a positive, forward-looking energy future based on the understanding that our nation’s best energy future can only be achieved through a true all of the above energy strategy.

Future generations are looking to us to get our nation’s energy policy right, today. They are counting on us to leave them a country that is second-to-none in energy production, security, economic prosperity and environmental protection.

Thank you for your time.