Climate Doers

Mark Green
Posted March 20, 2015

More unhelpful talk from the administration directed at America’s energy industry – strange, given the key role played by the oil and natural gas industry in the nation’s recovery from recession, in reducing oil imports, in making the U.S. more secure in the world and in reducing greenhouse gas emissions, all on the current administration’s watch.

It’s not that some in the administration haven’t noticed these positives. Interior Secretary Sally Jewell at CSIS this week:

“… it’s no coincidence that our economic recovery has been accompanied by the biggest energy transformation of our lifetimes. The energy revolution we experienced in these last six years helped spur the recovery, but it’s also been accelerated by the policies our country put in place. Since 2008, American oil production has surged, from 5 million to 9 million barrels a day. And our dependence on foreign oil has fallen to its lowest level in more than 30 years. … These shifts in U.S. energy markets aren’t marginal or temporary. They are tectonic shifts …”

And the president’s Council of Economic Advisers:

Over the past ten years, the U.S. economy has undergone a revolution in the production and consumption of energy. Increasing production of oil, natural gas, and renewable energy has contributed broadly to employment and gross domestic product (GDP) growth during the recovery from the Great Recession. … Declining net oil imports have helped reduce the U.S. trade deficit and improve energy security. … The combined effect of increased production of natural gas, oil, and liquid biofuels has positioned the United States as the leading petroleum, natural gas, and biofuels producer in the world.

Yet, in a recent interview President Obama talked about energy companies and climate change in adversarial, unproductive tones – echoing other administration messaging lately that borrows from the activist community. Like that messaging, these recent remarks are divorced from reality:

“In some cases, though, you have elected officials who are shills for the oil companies or the fossil fuel industry and there's a lot of money involved.  Typically in Congress the committees of jurisdiction, like the energy committees, are populated by folks from places that pump a lot of oil and pump a lot of gas.”

Interestingly, that comment followed another in an apparent moment of understanding. The president:

“You can’t fault somebody for being concerned about paying the bills or being able to fill up your tank to get to your job.”

No, no you can’t. You also can’t fault somebody for wanting security – both personal and economic – or for wanting choices over where they live, what they eat, the products they buy, where they travel, how many children they have, et cetera, et cetera, et cetera … No, indeed, you can’t fault somebody for wanting energy.  All-of-the-above energy, affordable energy, energy when they want, in the amounts they need.

As for climate change, let’s be clear: The oil and natural gas industry is a scientific industry and an engineering industry, and foremost, it’s an energy industry. We’re not ideological, so we’ll leave the moralizing and finger pointing on climate and climate denial to others, because we are not climate talkers, we are climate doers.

We are leading the way on investments in greenhouse gas emission-reducing technologies, putting in an estimated $165.4 billion (including shale gas investments) from 2000 through 2012, according to a study by T2 and Associates (see chart, below). That’s more than the rest of private industry combined ($91.2 billion) and more than double the federal government ($79.7 billion). These investments include efficiency improvements, advanced vehicle technology, fuel substitution, wind, biofuels and solar.

We are leading the way on reducing carbon dioxide emissions, with increased natural gas use responsible for 62.39 percent of all CO2 savings since 2005, according to the U.S. Energy Information Administration.

We are constantly improving operations – illustrated by recent field studies finding that methane emissions from natural gas production are being reduced.

And yes, there is a lot of money involved in selling people a product that they choose to buy, and that is a very good thing – especially for the true owners of America’s oil and natural gas companies: millions of Americans. It’s also good for the federal government, which receives about $85 million a day from the oil and natural gas industry in the form of income taxes, rents, royalties and other fees. Industry companies pay considerably more in taxes than the average manufacturing company, with income tax expenses (as a share of net income before income taxes) averaging 40.2 percent in 2013, compared to 25.2 percent for other S&P Industrial companies.

A postscript: Last week it was announced that global emissions of carbon dioxide declined, during a period of economic expansion, for the first time in 40 years.  That’s great climate news and further proof that America’s energy industry is leading the way.