Foundations for a Forward-Looking Energy Policy

Mark Green
Posted February 7, 2013

Hard to surpass the week on Capitol Hill – when it comes to sketching a pro-development approach to energy that could give major lift to the U.S. economy while helping make our country more energy secure.

On the House side, an Energy and Commerce subcommittee heard experts like Daniel Yergin describe North America’s energy resources (video here and here). Meanwhile, U.S. Sen. Lisa Murkowski of Alaska unveiled a blueprint for greater U.S. energy self-sufficiency by the year 2020. Both provided excellent data and arguments for greater domestic oil and natural gas production that will make our country stronger, more prosperous and more secure. Highlights:

Yergin, vice chairman of IHS CERA:

“The United States is in the midst of the ‘unconventional revolution in oil and gas’ that, it becomes increasingly apparent, goes beyond energy itself. Today, the industry supports 1.7 million jobs – a considerable accomplishment given the relative newness of the technology. That number could rise to 3 million by 2020. In 2012, this revolution added $62 billion to federal and state government revenues, a number that we project could rise to about $113 billion by 2020.”

More Yergin:

“Owing to the scale and impact of shale gas and tight oil, it is appropriate to describe their development as the most important energy innovation so far of the 21st century. … It is striking to think back to the hearings of even just half a decade ago, during the turmoil of 2008, when it was widely assumed that a permanent era of energy shortage was at hand. How different things look today.”

Mary J. Hutzler, Institute for Energy Research:

“The United States has vast resources of oil, natural gas, and coal. In a few short years, a forty-year paradigm – that we were energy resource poor – has been disproven. Instead of being resource poor, we are incredibly energy rich.”

The challenge, which policymakers must begin addressing more directly, is focusing on actions that can make America’s energy wealth work for America: in terms of jobs, direct and associated economic growth, revenues for governments – and, of course, the energy that makes our lives modern and comfortable and our aspirations possible.

Murkowski, vice chairman of the Senate Energy and Natural Resources Committee, spoke to this while outlining her plan:

“Energy is good. Energy provides the basis for advanced civilization and improved standards of living. It allows us to live comfortably in climates that would otherwise be too hot or too cold. It allows us to transport ourselves and cargo around our neighborhood or around the world. It allows us to produce food in the quantities necessary to feed the world’s population. It allows us to manufacture and communicate and enables every aspect of modern life.”

Her plan has a number of positive features for greater domestic oil and natural gas production, including:

• Expedited federal energy permitting – for resource extraction and infrastructure projects.

• Construction of the full Keystone XL pipeline.

• Plans for energy development on the outer continental shelf, to more accurately estimate available resources while setting minimum production targets.

• Streamlined and simplified federal offshore permitting – specifically repealing a number of recent additional requirements imposed on shallow-water Gulf of Mexico drillers.

• Access to 2,000 acres in the non-wilderness portion of the Arctic National Wildlife Refuge coastal plain, for energy exploration and production.

• Full access to the National Petroleum Reserve-Alaska for oil and natural gas leasing, accompanied by appropriate infrastructure development (roads, bridges, pipeline facilities).

All are integral to an energy strategy that safely and responsibly manages our resources – with more drilling, reasonable and predictable regulation and tax policies that encourage energy investment