GAIN Spokesman says 2020 Democrats need to get real on energy

The New Hampshire Union Leader recently published an op-ed by GAIN spokesman Craig Stevens in which he discusses the ongoing 2020 Democratic primary race. He goes into detail regarding the candidates’ radical stances on energy policy, positions which he theorizes are not based on facts, but rather aim to attract far-left voters.

Take the candidates’ approach to energy policy. Despite the fact that the United States is at the top of its proverbial energy game — producing record amounts of oil and gas — the proposals in circulation among some 2020 hopefuls lack any grounding in the realities of America’s ability to produce energy resources or the ongoing need to use them.

Rather than making the most of our vast resources, unmatched workforce and leading innovation, candidates are choosing instead to pursue the most quixotic of goals in hope of standing out to early voters. Primary season is traditionally known for bringing out the best in a candidate. It should not justify irresponsible and unrealistic policy.

Stevens specifically calls attention to Washington Gov. Jay Inslee, whose outlandish energy proposals include calling for a complete ban on development of oil and gas resources on public lands, and prohibiting crude oil exports. This position clearly does not align with American interests; as 80% of US energy consumption in 2018 came from fossil fuels. Joe Biden’s own environmental plan, labelled by his campaign as a “clean energy revolution” is estimated to cost Americans over $5 trillion. However, natural gas was endorsed as a positive fuel source for America by President Obama himself in 2014.

Working towards a sustainable energy future for generations to come is important. But these aren’t serious proposals, and they ignore the inherent strengths of American energy.

Not all that long ago, natural gas was hailed as a “bridge fuel,” a foundation of bipartisan energy policy. In his 2014 State of the Union address, President Obama argued that natural gas “can power our economy with less of the carbon pollution that causes climate change.”

A disconcerting number of today’s candidates and activists, however, seem to have a different view. They fail to recognize the important role natural gas plays in meeting our nation’s energy needs while lowering carbon emissions at the same time.

Stevens concludes by applauding Democratic candidates like Colorado Sen. Michael Bennet and Montana Gov. Steve Bullock for approaching energy policies with a rational and realistic point of view, and encourages other candidates to follow suit.

Radical proposals make for a good stump speech, but they don’t always translate to the real world. As the campaign advances, here’s hoping we see more pragmatism and considerably less energy fantasy.

Read the full article here.

New York Pipeline Delay Causing Real World Consequences

New York and New Jersey have rejected construction permit requests for Williams’ Northeast Supply Enhancement Project, thanks to politicians bowing to environmental extremists who disingenuously call the project “dangerous and reckless” and vow to use any means necessary to prevent it from being built. A concerning trend has developed in which many energy infrastructure projects – like Williams’ Northeast Supply Enhancement Project – are denied permits based on ideological opposition to fossil fuel use rather than the individual project merits and fact.

But kowtowing to these groups by New York Gov. Andrew Cuomo and New Jersey Gov. Phil Murphy is having real world consequences that are hitting the pocketbooks of small business owners in New York:

“About $400,000. That’s how much two New York City deli owners say National Grid Plc may cost them by refusing to supply natural gas to a new burger restaurant they’re planning in Brooklyn.

The men are victims of a complex face-off between the utility that supplies gas to the metropolitan area and state regulators. New York and New Jersey have denied approvals for the $1 billion Williams Cos. pipeline expansion that National Grid has said is needed to boost their gas capacity.

Williams Cos. has vowed to reapply for approval but, in the meantime, National Grid is declining to approve any new contracts to supply gas. It’s a decision that could hamstring new businesses and housing, say support groups in New York and on Long Island.

The deli owners learned in early July the utility wouldn’t accept their application for gas. Now they say they may have to cancel their plans. ‘We have already hired employees, who are sitting and waiting, asking ‘When can we come into work?’ Muhammad Quereshi, one of the men, said in a telephone interview. The denial, he said, leaves them to pay back $400,000 in business loans they expected would come from the new restaurant’s profits.

Nobody knows how many businesses are affected yet, but any business that wants to come in and requires natural gas — in particular, restaurants — will face difficulty trying to get it.

The delay is also having an environmental impact, experts note:

Business advocates say that while they understand the need for environmentally-friendly alternatives to gas, the technology for renewables isn’t there yet to meet the energy needs of the region. The decision not to approve the pipeline extension is also thwarting a regional transition from heating oil to cleaner-burning gas.

“Renewable projects are a long-term play, but they’re not here yet,” said Kevin Law, president and CEO of the Long Island Association. “They can’t turn on lights, heat our homes or cool our buildings for many years to come.”

And it’s hampering economic development throughout the region:

The utility cutoff will ‘undo a lot of the success we’ve had in growing the Long Island community in the last 10 years,’ Law said.

New York City and Long Island aren’t the only areas in the state facing the issue. Westchester County was put under a moratorium on new natural gas service by Consolidated Edison Inc. in March. At the time, the County projected that the construction of 16,000 homes could be suspended.

The issue has forced some developments to be redesigned to accommodate new methods of heating, said Mitchell Pally, CEO of the Long Island Builders Institute.

Pally said he expected several projects to leave the area since “it’s hard enough to develop in Long Island. Without an adequate and sustainable energy source, it will be much more difficult.”

‘It’s definitely stopping development at a very base level,’ said Thomas Grech, president and Chief Executive Officer of the Queens Chamber of Commerce.”

Pipelines are carefully reviewed and permitted by local, state, and federal regulators as part of a rigorous, multi-year process. Study after study has proven that pipelines are the safest, most efficient, and most environmentally-friendly method of transporting the energy products that American consumers rely on every day. It’s time politicians stop playing politics with pipelines just to score points with environmental extremists.

GAIN Strategic Advisor Col. Tom Magness (USACE) Featured on Pipeliners Podcast

GAIN Strategic Advisor Col. Tom Magness (U.S. Army Corps, retired) was recently featured on Pipeliners Podcast, an outlet for professionals who care about pipeline operations to discuss the latest information and benefit from each other’s experience. The segment focused on the rigorous pipeline permitting and review process, tapping into Magness’ extensive experience with the U.S. Army Corps of Engineers, where he oversaw the completion over numerous multi-billion dollar infrastructure programs – from Southern California to Afghanistan.

Magness describes the Corps’ role as “Permit. Our job is to permit, to allow for reasonable development, and we need to work with these folks and find a way, and do that in a way that preserves the public interest.” In addition, he highlights the value of input from the public when it comes to infrastructure projects and describes the importance of reliable infrastructure in moving our nation forward:

When you’re trying to find balance between issues that sometimes have the appearance of being in complete opposite of one another, that can be a real challenge. What is important is we’ve got to find common ground for better or for worse.

I always like to start my public hearings, and many permits, as part of the process, there’s a public hearing component to it. Usually the district commander or the colonel is required to oversee that public hearing.

You get people, and they’re going to say whatever they want to say. As a professional, I’ve got to listen to them, but I would always try to start those public hearings with the Pledge of Allegiance.

Let’s get on the same page here. We’re all trying to do the right thing for our nation, and now let’s move forward. These were some difficult issues, and the first thing that I would tell you is we should all feel very good about the professionals that we have doing this business.

They’ve committed their life in the Army Corps of Engineers. These are civilian regulators that have put themselves, oftentimes, in harm’s way to be the face, the public face of the Army Corps of Engineers is our regulatory program. These folks are true professionals, and they understand the need for balance.

They’re going to make decisions based on science and based on the facts, and their judgment, I think, is solid, and they do the best they can. They’re the ones that present the decision to the colonel, and the colonel is the one that says yes or no. We should feel real good about the people that we have doing that job.

The podcast also highlighted Magness’ experience mitigating conflict and arbitrating divisive conversations between stakeholders who held different views. It is crucial that projects are evaluated independently and based on their individual merits – rather than on widespread or an ideological basis.

Sometimes you have to see beyond the emotion, and the emotion of some is not no, but heck no, that there’s no possible way that we would ever allow…

Let’s take a pipeline project. There are some who are opposed to the project just because of what it is, and the fact that it’s moving carbon products, and that there is no alignment, there is no location, there is no construction technique that would ever satisfy them if that is their position. No.

I’ve found it important to, “Let’s put this on the table. We’ve got to find a way. Can we all agree that there is a way? We may not know what it is right now, but that there is a way that we could get to yes that would balance our requirements for environmental stewardship and sustainable development. Can we all agree we’re going to find that way?”

We’ve got to get all the parties to agree to that, otherwise, you’re never going to move forward. There are some who start and end with, “It’s a no,” and that is not helpful.

In conclusion, Magness emphasized the importance of the public comment period and working closely, and transparently, with community members and local officials. Relationships are key.

What I don’t want to happen is we get to the end of a process, and then somebody jumps in with an objection that is going to cause us to go back to the beginning again. We’ve got to get all these people at the table from the beginning. We’ve got to establish some trust. There has to be a relationship.

I want people to pick up the phone and call me if there is an issue. I worked hard to build one on one relationships with the leaders of all those agencies so that we could have enough trust to move the process forward. We’ve got to trust the process.

Bipartisan Support Growing for Michigan’s Line 5 Project

Safe, modern energy infrastructure should not be a political matter – and six Michigan State House Democrats agree. In a joint statement, state Representatives Brian Elder, Tenisha Yancey, Wendell Byrd, John Chirkun, Terry Sabo, and Sara Cambensy expressed their support for a common-sense improvement project for the Enbridge Line 5 oil and gas pipeline that crosses the Straits of Mackinac.  They wrote:

“Our natural resources and our economy are too important to await the outcome of protracted litigation,” the lawmakers wrote. “We need to start the Line 5 Tunnel now.”

This statement comes in response to Democratic Michigan Attorney General Dana Nessel’s recently filed legal action seeking the immediate shut down of the existing operation of the Line 5 pipeline. As the GAIN Coalition has previously highlighted, the lawsuits brought by Nessel undermine the regulatory certainty needed for new investments in pipeline infrastructure.

The six representatives said they were “deeply disappointed” by Nessel’s action, adding the legal battle “guarantees the status quo.” The lawmakers supported the deal that was reached by the previous Michigan Governor and Enbridge in 2018 to encase the pipeline with a tunnel – the so-called Line 5 Tunnel.

The GAIN Coalition commends the six Michigan representatives for speaking out against the Attorney General’s lawsuits. Michigan’s – and North America’s – energy security should not be used as a political pawn.  Policymakers across the country should take note of these state Representative’s comments.

Bakken Bottleneck: The Need for Additional Pipeline Capacity in North Dakota

As the Bakken continues to produce record amounts of crude oil, North Dakota officials are anticipating challenges in the coming months transporting oil and natural gas to keep up with booming production. The Bismarck Tribune recently highlighted this challenge, pointing out increased production levels:

May’s numbers — the latest available — show that North Dakota wells produced 1.39 million barrels of crude per day, just 800 per day more than in April. Natural gas production dropped slightly to 2.82 billion cubic feet per day.

In order to sustain the continued growth in oil production in the Bakken, North Dakota will require building new and upgrading existing oil pipeline projects.  As North Dakota Department of Mineral Resources Director Lynn Helms reported to the Tribune:

Work is underway on a number of facilities to capture more of that gas, including several processing plants and Oneok’s Elk Creek Pipeline, which will carry natural gas liquids from eastern Montana to Kansas. Operations at processing plants depend on moving those natural gas liquids, such as propane, butane and pentane, out of state. The demand is so high to transport those liquids that the oil and gas industry is turning to trucks and rail to get those products to market, Helms said.

There are a number of new projects underway to ensure more crude oil is transported in the safest and most efficient way – by pipelines.  There is the recently announced Liberty Pipeline project, which will move oil from the Bakken to Cushing, Oklahoma.  And even more recently, there was an announcement of plans to expand capacity of the currently-operating Dakota Access Pipeline project.

The GAIN Coalition welcomes these new investments in Bakken pipeline infrastructure and their important role in meeting our nation’s energy needs.

Summer natural gas prices on track to be lowest in more than 20 years

The U.S. Energy Information Administration (EIA) recently forecasted the lowest summer average national natural gas price since 1998. EIA expects Henry Hub natural gas prices will be 55 cents/MMBtu, about 19%, lower than last summer’s average. EIA also forecasts Henry Hub natural gas spot prices for June, July, and August this year will average $2.37 MMBtu. Henry Hub in Louisiana is the benchmark price for North American natural gas.

With record levels of natural gas production, the U.S. must continue to invest in new energy infrastructure and expand the existing network to increase reliable, affordable natural gas access to American consumers across the country.

As a recent Wall Street Journal article pointed out, not all consumers in different regions of the country have experienced the benefits of the natural gas boom. The article highlighted some of the highest prices in the country:

Elsewhere, prices soared due to bouts of cold weather coupled with supply disruptions, including an explosion along a British Columbian pipeline and a leaky underground storage facility near Los Angeles. At a trading hub in Sumas, Wash., natural gas rose to $200 per million British thermal units in March, the highest ever recorded in the U.S. In Southern California, prices went as high as $23; the average over the winter was a record $7.23.

Policymakers at all levels of government must come together to prioritize investment in our critical energy infrastructure. Reliable, affordable energy is key to continued economic growth and bolsters American national security.

Why we need PennEast and other natural gas pipelines

The Morning Call published an op-ed written by GAIN spokesman Craig Stevens concerning America’s growing need for natural gas pipelines like the PennEast pipeline project. Stevens reasons that in 2019, 31% of power generated from the regional PJM transmission system has come from natural gas – a 25% increase from 2005. He goes on to explain how this natural gas boom brings with it considerable economic benefits:

This level of productivity brings considerable economic opportunity. Clean, affordable, reliable natural gas keeps business and industry productive while also generating direct benefits in the form of jobs, state and local tax revenue, cost savings and community investment. According to the Pennsylvania Public Utilities Commission, for instance, the state has distributed more than $1.5 billion in impact taxes since 2012, supporting hundreds of locally driven community improvement efforts.

The PUC also pegs household savings tied to natural gas production at roughly $1,200 thanks to lower heating and electricity costs. PricewaterhouseCoopers, meanwhile, estimates that more than 322,000 Pennsylvania jobs are either directly or indirectly tied to natural gas production.

Pennsylvania is a clear example of the advantages that natural gas development can bring to a state. The problem is that, in order to sustain this increase in natural gas production, new pipeline infrastructure needs to be constructed, and that isn’t happening.

The source of the capacity challenges isn’t complicated. There’s no shortage of investment potential, supply or engineering know-how. Rather, it’s simple political activism that’s dragging progress to a halt and threatening the region’s energy outlook.

A paper released recently by a local environmental advocacy group, for example, attempts to stop progress on proposed pipelines by raising environmental concerns. The irony of this effort, as is so often the case with pipeline opposition, is that the approval of the infrastructure being protested would represent a significant step forward in improving sustainability efforts.

Stevens goes on to note that the PennEast pipeline, a project worth $1 billion in investment, would help bring natural gas in fields from Pennsylvania to New Jersey. The project is expected to save energy consumers $1.3 billion, and generate thousands of jobs, but is still facing backlash. He concludes that, even if it makes activists upset, pipeline projects must move forward as natural gas demand continues to increase.

Political opposition is nothing new, and it’s not going anywhere. But even as activists speak out, it’s essential that elected officials and the public alike move forward in pursuit of modern pipeline expansion that strengthens energy security while also preserving our environment. The facts demand it, and the opportunity is too significant to ignore.

The Mid-Atlantic region has been dealt a strong hand. It’s up to us to make sure we don’t throw those cards away.

Read the full article here.

 

Senate Hearing Emphasizes Positive Impact LNG has had on U.S. Economy

Last Thursday, the U.S. Senate Committee on Energy & Natural Resources held a hearing discussing the “Important Role of US LNG in Evolving Global Markets.” Senator Lisa Murkowski (R-AK) and Senator Joe Manchin (D-WV) led the discussion. Witnesses who gave testimony included Hon. Steven Winberg, Assistant Secretary for Fossil Energy in the DoE; Dennis Arriola, Executive VP of Sempra Energy; and Charlie Riedl, Executive Director of the Center for LNG.

Discussion centered on the fact that U.S. LNG production and exports are at an all-time high. Witnesses testified about the effects this recent LNG boom has had on global and domestic markets and the U.S. economy. Dennis Arriola was optimistic that, as LNG production increases and more pipelines and export terminals are constructed, millions of new jobs will be created in addition to the thousands that have generated so far. “It’s clear: LNG exports create a lot of jobs, good paying jobs, here in this country,” according to Arriola.

Steven Winberg confirmed the positive impact that increased LNG exports have had on the U.S. economy, stating, “There is no doubt that natural gas has transformed our nation, and the world, for the better… It has created countless American jobs and has made our air cleaner.” Winberg continued that using LNG as a source of energy in combination with renewables such as wind and solar would be the best option for making U.S. energy more environmentally friendly. “Increased use of natural gas has helped lower energy-related carbon emissions to levels not seen since the last 1980s,” Winberg said, emphasizing that an “all of the above strategy” (renewables and natural gas acting as partners) would be the best when it comes to implementing cleaner energy in the United States.

Charlie Riedl agreed that using a mix of natural gas and renewable energy sources to power America would help lower carbon emissions, saying that “LNG exports could reduce global greenhouse emissions, by displacing more carbon intensive fuels.” He continued by emphasizing the positives LNG exports will bring: “U.S. LNG exports benefit everyone, with billions of dollars in investments, and thousands of dollars of good paying jobs here at home.”

Other points of discussion included a potential LNG trade deal between China and Alaska, with Chinese officials financing a pipeline project in Alaska, with the condition that China would receive 75% of all LNG produced from that terminal. However, there are many risks involved with this project according to Dr. Melanie Hart, Senior Fellow and Director of the China Program at the Center for American Progress. She emphasized that a foreign state-owned enterprise has never had a majority stake in a U.S. natural gas project before, and that multiple firms in the U.S. had rejected working on this project before China agreed to finance it. Dr. Hart was right to raise these concerns.

The hearing reiterated key facts about LNG that we already know; that LNG productions are at an all-time high, and that we need more infrastructure to transport said LNG in the safest, most environmentally friendly manner possible. The witnesses touched on the ongoing fights between environmental groups and pipeline developers, and how recent projects have been stalled by constant harassment and vandalism from activists. Senator Lee (R-UT) affirmed, “But in order for it [LNG] to benefit American consumers in the way that it should, we have to be able to get it from Point A to Point B.” As GAIN has reiterated time and again, there’s a serious natural gas distribution problem in this country: natural gas customers are getting rejected in New York, while Texas has so much natural gas that they’ve started burning the surplus because it’s cheaper than storing it. The facts show that this recent LNG boom has bolstered the economy and created thousands of jobs; and experts agree that more pipelines are vital when it comes to keeping this momentum going.

Empire State Embodies Misinformed Energy Policy

Last week, Forbes published an op-ed written by Dan Eberhart, CEO of oilfield services firm Canary Energy, in which he discusses how Democrats are using the wrong strategy by stonewalling the oil and natural gas industry. He warns that this method will not bring the votes they hope for, and will instead further alienate those who could benefit from the jobs and economic productivity that oil and natural gas are bringing to this country.

“These presidential hopefuls will no doubt further the initial dog-pile we saw at the first round of Democratic debates by calling for the repeal of so-called ‘subsidies’ for conventional producers, even though what they really mean are tax incentives utilized by most manufacturing industries. They will continue to attack oil and natural gas as climate-change boogeyman, even though the United States’ shale boom has created a path to energy independence, driven carbon emission to record lows and is helping bring alternative fuels online.”

Eberhart specifically calls out Governor Andrew Cuomo, and the damage that his anti-energy views have wrought on the state of New York. Decisions like banning hydraulic fracturing and putting halts on pipeline projects have cost New York jobs, economic opportunities (which have gone instead to other states like Pennsylvania), and resulted in higher consumer costs. The Constitution Pipeline project, worth $683 million, was projected to provide natural gas to 3 million homes, generate 2,400 jobs, and bring in over $160 million in revenue. What happened? Andrew Cuomo denied the project a necessary water permit, pleasing his base at the cost of jobs and income for the rest of New York.

He goes on to list similar projects that Cuomo has halted, which also caused New York to miss out on jobs, revenue, and investment opportunities. Projects include Northeast Supply Enhancement, which could have generated $23.7 million in GDP, and the Northern Access Pipeline, which was projected to generate $735 million in investment and economic activity.

Eberhart concludes that Democrats should face the facts and admit that energy like oil and natural gas is promoting the US economy, and that we need these pipeline projects in order to sustain this economic growth.

“While Democrats may jump at the chance to beat up on oil and gas, their calls to end fossil fuels hardly deal in reality. Traditional fuels supply more than 80 percent of U.S. energy. Technological advances are making these resources safer, cleaner and more efficient, allowing for falling carbon emissions even while production – and economic growth – increase.

Shale development and robust infrastructure capabilities are helping to drive our economy, secure the country’s energy independence, reduce our carbon footprint and better protect our communities and the environment. Voters likely won’t hear that on stage during the forthcoming Democratic debates either. But if there is any reminder needed of where the candidates stand on ensuring affordable and reliable energy, all they need to do is look at the problems Gov. Cuomo has created in New York.”

Read the full article here.

Domestically Produced Natural Gas Powering U.S. Economy

New data from the U.S. Energy Information Administration shows that more than 90% of the natural gas consumed in the U.S. in 2018 was produced domestically. This dramatic reversal of fortunes comes less than a decade after many thought the U.S. was all but certain to be increasingly reliant on foreign imports to meet natural gas demand.

U.S. natural gas production hit a new record high of 89.6 billion cubic feet per day (Bcf/d) in 2018, an 11% increase from the year prior. The consecutive year-over-year increase was drive in part by the addition of new pipeline capacity in key producing regions, including the Marcellus and Utica shales in Ohio, Pennsylvania, and West Virginia as well as the Permian Basin in West Texas and southeastern New Mexico.

The benefits of increased natural gas production are clear with more and more Americans gaining access to clean, affordable energy resource. In fact, a recent study from the National Bureau of Economic Research found that declining heating costs resulting from abundant natural gas supplies has led to a decrease in winter mortality rates.

“We find that lower heating prices reduce mortality in winter months. The estimated effect size implies that the drop in natural gas prices in the late 2000s, induced largely by the boom in shale gas production, averted 11,000 winter deaths per year in the US. We also find that the effect does not just represent short-run hastening of mortality.” (emphasis added)

Greater use of natural gas is also empowering the U.S. to achieve meaningful reductions in greenhouse gas emissions. As the International Energy Agency noted in 2017:

“The US power sector has led the world in cutting CO2 emissions since 2008, thanks largely to natural gas displacing coal.”  

Ernst Moniz, the former U.S. Secretary of Energy under President Obama, echoed this point during a policy address at Columbia University’s Center on Global Energy Policy:

“First of all, it is a fact that in these last years the natural gas revolution shall we say has been a major contributor to reducing carbon emissions. The president has a goal as I mentioned at 17 percent by 2020. We are about halfway there and about half of that is because of the substitution of natural gas for coal in the power sector essentially driven by market forces.” (emphasis added)

It’s clear that natural gas will play an increasingly important role in meeting the energy needs of American households and businesses for decades to come.