Energy Today - February 17, 2011
Rayola Dougher
Posted February 17, 2011
Energy Outlook: Cutting the Federal Budget Wisely: Now, one could argue in the abstract whether a tax credit or deduction constitutes a gift of "taxpayer money" (i.e., the government's) or an opportunity for the taxpayer in question to remit less of his own money to the government. I know how I feel about that when it comes to filing my form 1040. One might even arrive at different answers in different situations. As a practical matter, however, what counts in the current context is not whose money this is in the first place, but whether taking more of it leaves either the federal government or the US economy better off. Even from the perspective of tax revenue, a recent study found that after an initial increase, the long-term impact of higher taxes on the oil & gas industry resulted in reduced government revenue. Higher taxes on US oil & gas production will translate into less of both--and so less to tax--while also yielding more future imports and higher trade deficits, along with reduced energy security. The President's remarks also suggested incorrectly that oil and gas are yesterday's energy, and not also today's and tomorrow's. In 2009 oil and gas accounted for 62% of our energy consumption, and the US Department of Energy expects them to continue to supply as much as 57% of our needs in 2035, after subtracting the contribution of liquid biofuels. Treating these key energy sources as undesirable could have serious consequences for our energy and economic security in the years ahead. Nor would it assist our efforts to reduce greenhouse gas emissions. Natural gas can contribute significantly to reducing the emissions from the power sector, which accounts for 40% of US CO2 emissions, and the main opportunities for reducing emissions from transportation, where most of our oil use takes place, are on the user side--conservation and more efficient cars, trucks and planes--and not on the extraction, refining and distribution side of the industry. Reuters: Senator pushes for oil sands pipeline approval: A leading Republican Senator on Wednesday called for the White House to approve the Keystone pipeline that would transport crude from Canadian oil sands to the Gulf coast. Senator Dick Lugar, the top Republican on the Senate Foreign Relations Committee, said the State Department should move to quickly approve TransCanada's application to build the 2,000-mile Keystone XL pipeline. "Boosting trade with Canada offers tremendous opportunity to improve our energy security," Lugar said in a speech to the Alliance to Save Energy. "This pipeline is critical to American efforts to enhance the reliability of our oil supplies," he added. Lugar said the United States is too dependent on oil from hostile nations and the government must work to decrease vulnerability to supply shocks from the Middle East.
Additional Resources:
The Detroit News: Automakers want House to block 15% ethanol fuel blend
Homer Tribune: Cutting oil taxes increases jobs