The People of America's Oil and Natural Gas Indusry

Just Say ‘Yes’ on Natural Gas, Infrastructure

Mark Green

Mark Green
Posted July 1, 2016

When you see the significant economic, consumer and climate benefits to the U.S. from increased  use of natural gas, it’s quite a puzzle when some won’t take “yes” for an answer – yes to lower energy costs, yes to infrastructure jobs, yes to carbon emissions reductions. Unfortunately for Massachusetts residents, that’s the path the state legislature appears to be taking. More below. First, a review of how clean-burning natural gas is making life better across the rest of the country.

Let’s start with reduced household energy costs, which are helping to lower Americans’ cost of living, according to the U.S. Energy Information Administration (EIA). In constant 2015 dollars, EIA says average annual energy costs per household peaked at about $5,300 in 2008 then declined 14.1 percent in 2014.

household

Some of that’s due to lower gasoline prices – another piece of good energy news, which surging U.S. oil production helped make possible. But the affordability and availability of natural gas is directly impacting home heating costs and the costs of electricity generation, with the price of electricity in the nation’s largest power grid 40 percent lower than it was five years ago.

power_sector

In terms of the broader economy, affordable and abundant natural gas is helping the manufacturing sector with reduced operating costs and also in lower costs as a feedstock for a number of items made from natural gas.

Now let’s look at climate. It’s pretty simple: The United States is leading the world in the reduction of energy-associated carbon emissions. This is mostly because of the increased domestic use of clean-burning natural gas, which EIA projects will, for the first time ever, be the No. 1 energy source for electricity generation this year.

share

More gas-fired power generation helped the U.S. cut carbon emissions last year to 21 percent below 2005 levels. Thumbnail analysis: While there’s lots of talk around the globe about ways to reach climate objectives, the United States is doing it.

This is winning, on multiple fronts.

Now, about Massachusetts, where regional natural gas pipeline capacity is unable to meet demand from residential customers and power providers during cold weather, resulting in New Englanders paying the highest prices for electricity in the Lower 48. Jude Clemente writes in Forbes:

New England’s much higher prices hurt families and businesses and are wreaking havoc on New England’s poor and the elderly. Manufacturers are shutting down or cutting operations due to higher energy prices. Excluding isolated Hawaii, New England holds the top four states with the highest energy prices (here), and none of the six states rank above 28th in “best states for business” (here).

Even so, Massachusetts’ state Senate adopted an amendment to energy legislation this week that prohibits the Department of Public Utilities from approving private natural gas pipeline financing, which could impact consumers.

Steve Dodge, Massachusetts Petroleum Council executive director, says a strong majority of state residents are concerned about energy costs and don’t think lawmakers are doing enough to help the situation. The region has some of the newest, most efficient gas-fired power plants in the country, Dodge says, but needs more pipeline infrastructure. Dodge:

“[W]ithout new pipeline infrastructure, New England consumers and businesses will be at a disadvantage – hurting our economy and making it hard to keep good paying jobs in our region. Failing to expand the region’s energy infrastructure could cost families and businesses $5.4 billion in energy costs in the next four years alone.”

Natural gas is providing economic and consumer benefits to other parts of the U.S. – while also helping advance climate goals. Infrastructure is key. With the prolific Marcellus Shale region of Pennsylvania near, more pipeline capacity could allow Massachusetts and the rest of New England to see more of these benefits – if they’ll just say yes.

ABOUT THE AUTHOR

Mark Green joined API after a career in newspaper journalism, including 16 years as national editorial writer for The Oklahoman in the paper’s Washington bureau. Mark also was a reporter, copy editor and sports editor. He earned his journalism degree from the University of Oklahoma and master’s in journalism and public affairs from American University. He and his wife Pamela live in Occoquan, Va., where they enjoy their four grandchildren.