A recent op-ed published in the Albuquerque Journal by former EIA administrator Guy Caruso highlights how New Mexico’s energy sector could face hurdles under a Biden administration. President-elect Joe Biden plans to roll out a federal leasing ban that would inhibit fracking on federal lands designed to produce oil and natural gas. The federal government owns more than a third of the state’s land. If enacted, the ban would be detrimental to New Mexico’s economy. Caruso sheds light on the Land of Enchantment’s valued energy production:
“According to the Energy Information Administration, in a span of five years New Mexico grew from the seventh- to third-largest oil-producing state in the union. Similarly, New Mexico is eighth in natural gas production. Accessible natural gas makes it affordable, and households are reaping the benefits; residential natural gas prices are 40% below the national average.”
New Mexico has grown to become one of the top U.S. energy producers. The economic benefits from the state’s oil and gas sector are critical to keep in mind as they could create unnecessary strain for the public sector. Caruso explains:
“Without oil and natural gas operations, Gov. Michelle Lujan Grisham and Santa Fe legislators would be out $3.1 billion, according to 2019 statistics. Energy sector-related tax revenues have totaled nearly $20 billion and consistency provided over 30% of the annual state budget since 2010.
Are our politicians in Washington comfortable hamstringing states knowing that education, infrastructure and health care facilities will suffer? And what about private citizens?”
In addition to damaging state tax revenues, Caruso highlights how a federal leasing ban could threaten over 60,000 jobs throughout the state. It is critical for President-elect Biden to consider the economic consequences when implementing policy shifts in a new leadership. Transitional energy policy cannot be effective unless it is realistic. Caruso warns how Biden’s harsh approach could be harmful:
“America has built much of its recent economic success on the back of an independent energy industry that begets capital investment and improves national security. Washing away a comparative advantage like energy is a direct path to stunting the economy and hurting consumers. New Mexicans will be the first hurt if natural gas and oil become targets.”