Posts
by Randy Right
(Alabama,Monore)
Tuesday, May 8, 2012
May 5, Looking for Work
Saturday, April 28, 2012
‘If I Wanted America to Fail …’
Here’s an abbreviated version of a video by Free Market America on administration policies that the group says are undermining domestic energy production, economic growth, jobs and America’s overall prosperity. Of course, the mention of energy caught our ear. Take a look:
A longer version has gone viral, with more than 1.2 million views. Both versions make valid points about the need for abundant, affordable energy and the threat to America’s economy when that is denied – as well as the drag on jobs and growth posed by unnecessary regulation.
“If I wanted America to fail …” is a rhetorical device, of course. But it underscores ways America’s economic potential may be undercut by well-intentioned activism and political agendas.
Hey, Jay Carney, You Forgot Something!
POLITICO Pro Energy reports that while talking to reporters about crucifixion comments by EPA’s Region 6 administrator, White House spokesman Jay Carney assured that the administration has “a commitment to ensure natural gas is an essential part of our future.”
Hold on. Something missing here … oil!
Sure, natural gas is an essential part of our future. But Carney must’ve had the Roman legions on his mind when he neglected to mention oil as equally important. We’ll remind him:
Actually, by usage, oil is the most essential piece of America’s energy portfolio, supplying about 37 percent of our energy right now, according to the Energy Information Administration (EIA). Natural gas is second at about 25 percent.Oil will be America’s energy of the future, too. EIA says it will supply about 35 percent of our energy in 2035 (natural gas still second at 25 percent).All energy sources are important now and in the future -- we’ll need a true all-of-the-above strategy. Any discussion of America’s energy policy needs to start with America’s energy reality, and that needs to start with oil. While we would certainly welcome an actual commitment to natural gas, the Administration also needs to be committed to securing our liquid fuel needs, and we can do it, we are not energy poor, we have the resources and the technology to develop them safely. This is what energy progress looks like:
Our Energy and Economic Crossroads
During a recent conference call with reporters API Chief Economist John Felmy said the country is at a “crossroads of energy and economic policy.” That’s quite a crossroads. Chad Moutray, chief economist at the National Association of Manufacturers, pointed out that manufacturing has added 462,000 net new jobs since 2010, and that continued growth hinges on energy and regulatory policy. So, where do we stand?
The administration’s energy policy is a muddle, as IPAA President and CEO Barry Russell argues in this Roll Call piece:
“Obama calls to expedite infrastructure projects, but in the wake of rejecting the Keystone XL pipeline. Obama claims increased oil and natural gas production on his watch, but then follows up with accusations that oil companies are profiting at the expense of the American people. Obama repeatedly calls for an ‘all of the above’ energy strategy, but then singles out the oil and natural gas industry for new regulations and targeted tax attacks.”
OK. Not so great. How about regulatory policy?
Last week’s new EPA rule on emissions from oil and natural gas development had positive elements – for example, delaying industry compliance with some costly and labor-intensive requirements until 2015. Still, overall, the administration’s regulatory approach hasn’t been encouraging, chiefly seen in policies that limit access to federal areas onshore and offshore.
Fuel Fix reports that deepwater drilling in the Gulf of Mexico is getting busier, but take a look at the actual numbers:
“The government awarded 163 deep-water drilling permits for the Gulf in 2009. The number dropped to 74 in 2010, but has climbed since then to 79 in 2011 and 44 through March of this year.”
And:
“[Analyst Robert] Kessler also noted that the time required for approval of exploration and development plans is still 150 days on average, compared to 54 days before the moratorium, another indicator of the added expense and challenge since the spill.”
Felmy cautioned that added regulatory layers “can slow development” of America’s vast energy resources. “Look at the totality of all EPA rules,” he said. “It really is an onslaught.” Moutray said the economic recovery is tenuous, and that the manufacturing sector is looking for broad energy options and sensible, stable policy from government:
“Energy is critical. We need affordable sources of energy to remain competitive globally. … We need an all-of-the-above approach that doesn’t pick winners and losers, that stresses the ‘all’ and not just favored projects. … We must have as many tools as possible for energy.”
Energy is the linchpin for economic growth – especially in the manufacturing sector. Developing energy from shale in Pennsylvania, North Dakota and Texas has produced jobs and a rising economic tide capable of lifting state and regional economies. Ohio and other states are poised to benefit as well.
The question is whether Washington will allow that kind of activity to go forward, or will it sap the momentum with red-tape delays and new layers of restrictive regulation, possibly duplicating effective state regulatory efforts? Will the administration continue to threaten higher taxes on an industry that pays its fair share already and is ready to do much more on energy and jobs? Will it get serious about domestic oil production, onshore and offshore, and end its obstruction of the Keystone XL pipeline?
As Felmy noted, these are components of an energy strategy that could see the United States reach energy self-sufficiency through North American resources in just 12 years.
Good questions for consideration at the crossroads.
Friday, April 27, 2012
Rhetorical Engagement on the Keystone XL Pipeline
Rounding up some of the latest rhetoric by Keystone XL pipeline opponents – separating fact from fiction (and utter fantasy) – while striving for an informed energy discussion. It’s not easy.
Let’s start with a great big fact:
The U.S. Energy Information Agency (EIA) reports that oil and natural gas supply 62 percent of the energy we currently use. In 2035, EIA says oil and gas still will supply about 60 percent of the energy we use.That’s the energy reality, according to the government. We run our economy and our lives on oil and natural gas. It’s the energy of today and tomorrow. Yes, America will need all energy sources in the years to come, but any notion that we can embark on an “off-oil” strategy without severe economic and social repercussions is uninformed, disingenuous or, as suggested above, fantasy.
Against that backdrop let’s review a couple of recent energy-related offerings – one that links the Keystone XL’s construction and Canadian oil sands production to the possible destruction of other cultures and the environment. Another serves up some warmed-over gasoline exports myths.
Post #1:
“It is undeniable that Keystone XL would bring about immense devastation to other cultures. Consider the members of Canada's First Nations groups, who have been more vocal about the need to stop the pipeline than almost anyone else. If Keystone XL were approved, their way of life would enter a rapid downward spiral and ultimately collapse.”
Actually, this is deniable. First, a number of pipelines already crisscross energy-rich Alberta:
Click on the map for a larger view, and you’ll see the red dotted line representing the Keystone XL follows a path already taken by other pipelines in Canada. The idea that the Keystone XL would threaten anyone as described in the post is ridiculous.
Second, click on the link in the post and you’ll see that opposition from the First Nations groups is mostly directed toward a pipeline that would go west from Alberta to the coast, a proposal that has gained traction as Canada started thinking about other customers for its oil – following the Obama administration’s Keystone XL rejection.
Let’s go on. The post makes claims about environmental devastation from the proposed pipeline:
“In order to exploit a region's tar sands, new roads must be built, enormous machines have to be brought in, and, most harmfully, every tree in the surrounding region needs to be cleared or burned. A population that relies on nature will be totally unable to continue to sustain itself if oil companies wipe out almost all biodiversity and bring in dangerous chemicals and pollution.”
If the author had done some homework, it would’ve been clear that Canadians are dead serious about protecting their environment. Clear-cutting and/or burning trees? By law oil sands development areas have to be restored to their natural state by companies operating there. One, Suncor, has developed a way to reclaim its tailings ponds, as well as a process that will eliminate the need for tailings ponds altogether. The company has turned one former tailings pond into a lush meadow, with hundreds of thousands of tree seedlings planted.
Similar environmental consciousness is being shown by other companies. Last week there was this story about Shell’s efforts to offset its oil sands footprint with the purchase and preservation of acres of forest.
One more from Post #1:
“Most infuriatingly, it is not even as though the U.S. needs tar sands oil or else it will not be able to fuel ambulances or power schools. The reality is that Americans use a huge amount of energy to perpetuate inefficiency and wastefulness. Furthermore, enormous reserves of potential renewable energy go unused every day because individuals and legislatures refuse to make sufficient investments. In other words, by continuing to support tar sands oil (as we already started doing several years ago with the construction of other pipelines from Canada) we are choosing to decimate other cultures and livelihoods before even fully investing in robust efficiency standards and renewables.”
A distillation of the above: The United States isn’t spending enough money on improving efficiency or developing other fuel sources.
Yet, according to EIA’s 2011 energy outlook report, the U.S. used about half as much energy for every dollar of GDP as it did in 1980. Meanwhile, investments in greenhouse gas-reducing technologies start with the oil and natural gas industry, which spent $71 billion on these between 2000 and 2010 – almost as much as all other private industries combined ($74 billion) and nearly double what the federal government spent ($43 billion). As for renewables, energy analyst/blogger Geoff Styles offers perspective:
“[Renewables] produce electricity rather than liquid fuels, and less than 1% of US electricity is generated from oil today, compared to more than 10% in 1980. Electricity from renewable and nuclear power doesn't compete with imported oil or any other kind of oil; it competes with domestic energy sources like coal and natural gas, most of which now comes from conventional and unconventional gas fields, rather than as a byproduct of producing oil. So by all means let’s have a conversation about renewables in the context of reducing greenhouse gas emissions today and displacing oil from transportation when there are tens of millions of electric vehicles on the road in the future, but in terms of oil prices now and in the near future, they are a rhetorical diversion.”
Quickly, Post #2 incorrectly argues that crude delivered by the Keystone XL would be refined for export to Europe and Latin America. This has been discussed here and here. EIA weighs in on exports and gasoline prices, here.
The Keystone XL enjoys broad U.S. support, demonstrated in poll after poll after poll. A majority in both houses of Congress supports the pipeline. Nebraska’s governor, who had concerns last fall, enthusiastically supports it now. It’s time to stop erecting phony arguments and flimsy excuses as obstacles to the project’s promise of stable energy and jobs.
The Right and Wrong Side of the Energy Divide
Interior Secretary Ken Salazar talked about a divide in America between the “real energy world and the imagined energy world” during a speech Tuesday in Washington. He’s got that right – but it’s not like the administration is on the right side of that divide. Consider:
It dismisses calls for increased access, saying it takes years to develop oil and natural gas resources, and then takes credit for increased production.It says it wants more oil and natural gas when in reality its policies set back production in the all-important Gulf of Mexico and on federal western lands.It says 75 percent of America’s offshore resources are open for development when in reality 87 percent of areas are off-limits.It says oil and natural gas are the energy of the past even though they currently supply 62 percent of the energy we use and in 2035 will still supply about 60 percent.It repeatedly suggests that America is an energy pauper, when in reality the country has tremendous energy wealth, with ample supplies onshore and offshore.It claims the oil and natural gas industry doesn’t pay its fair share in taxes when in reality it sends $86 million a day to the U.S. Treasury in rents, royalties and income tax payments, and its companies rank 1-2-3 on Forbes’ recent list of those paying the most in income taxes.Now, the Interior secretary’ s speech was on-target in some ways. Salazar said that “overwhelmingly, Americans agree on energy.” They do indeed:
84 percent believe increasing domestic oil and natural gas production could enhance the country’s energy security, according to a Harris Interactive poll last month.64 percent in that same poll said they believe some in Washington are intentionally delaying domestic oil and natural gas development, potentially hurting the economy and leading to higher consumer energy costs.Anywhere from 56 percent to nearly 70 percent in other polls say they support construction of the Keystone XL pipeline that would bring upwards of 830,000 barrels of crude oil per day from Canada to U.S. refiners – which the administration continues to obstruct while pretending others are at fault for the delay. Here’s video of the secretary doing just that after Tuesday’s speech (courtesy The Daily Caller):More Salazar:
“Americans want to cut our reliance on imported oil. They know that a lot of factors affect gas prices – including world markets and international events – and that, unfortunately, there’s no silver bullet in the near term.”
No question, world crude oil markets play the biggest role in prices at the pump – 76 percent of the cost right now – and affecting near-term change is problematic. But market signals do matter. And it’s time to take charge of our energy future by choosing the right policies to affect the long-term energy equation. For too long opponents of accessing available U.S. resources have used the “no silver bullet” line to block sound energy decisions – like drilling in remote Alaska, which by now would be an important part of the energy mix if it had been undertaken when it first began to be debated more than a decade ago.
Salazar once more:
“The energy world is changing … Whether it’s our oil and gas technology, our solar power plants, or our auto manufacturers, the pace of American innovation is staggering. The U.S. is determined to lead in the new energy world. So it’s no longer a question of whether you support renewable energy or conventional energy, or whether you favor the environment or the economy. The American people have decided to take an all-of-the above approach.”
The United States needs all of its energy resources, but a real all-of-the-above approach must do more than pay lip service to oil and natural gas production – today’s energy and tomorrow’s. The challenges are daunting, but historically Americans have risen to meet challenges with the help of strong leadership – in contrast to the rhetoric of resignation and powerlessness that frequently comes from the current administration. API President and CEO Jack Gerard, speaking last month at a congressional hearing on energy:
“With sound policy and bold leadership, we can put this country’s vast resources to work to change the current energy equation. … A strategy that confidently deploys resources here at home will send a clear message to global markets that the United States is serious about affecting supply. To the American people it will say help’s on the way. … With the right policies and strong leadership, we can secure our energy future instead of surrendering it to outside forces.”
There He Goes Again…
There has been a lot of good analysis of the president’s latest pursuit of alleged manipulation in the oil trading markets. The Council on Foreign Relations’ Blake Clayton makes a number of good points here, and energy blogger Robert Rapier notes the two-way risk inherent in commodities trading, here.
What’s clear is that the president’s concern isn’t new (see 2008, 2009 and 2011), and that White House officials had trouble connecting today’s announcement with anything substantive, as can be seen in a succession of tweets by Yahoo! News’ White House correspondent, Olivier Knox:
“White House punts on whether today's Pres Obama announcement re: oil speculation would have any impact on gas prices. (cont’d)”
“(cont'd) "We would leave that to outside analysts to disentangle,” senior administration officials tells reporters on conference call.”
“White House also refused to describe impact/extent of enforcement of laws re: oil speculation over past year."
“In short: White House won't describe extent of the problem of oil speculation, won't predict impact of today's announcement.”
But we digress. What caught our ear was the president plowing some familiar rhetorical turf, with a couple of demonstrably misleading riffs. Presidential Riff 1:
“The problem is we use more than 20 percent of the world’s oil and we only have 2 percent of the world’s proven oil reserves.”
This is a favorite of the president’s but it’s simply misleading, using a technical classification of one kind of oil reserve to camouflage the fact that the United States is sitting on approximately 200 billion barrels of oil, which the president never mentions, discussed here and here. This line earned “two Pinocchios” from the Washington Post Fact Checker back in March and probably deserves three Pinocchios now, because the White House keeps using it.
Presidential Riff 2:
“Even if we drilled every square inch of this country right now, we’d still have to rely disproportionately on other countries for their oil.”
False. According to the Wood Mackenzie energy consulting firm, if the United States pursued a pro-development strategy that included more domestic drilling – offshore, in remote Alaska and other places – as well as a stronger partnership with Canada (including the Keystone XL pipeline), we could see 100 percent of our liquid fuel needs supplied here and from Canada by 2024.
The real problem here is an administration that continues talking as if the United States is energy poor when in fact we’re energy rich. The president talks about an all-of-the-above approach to energy but has done little to support and enhance oil and natural gas, which supply more than 60 percent of our energy now and will continue to supply about 55 percent of it in 2035.
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