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All-of-the-above energy strategy needs more-of-the-below, Issa says

The Obama administration’s stated all-of-the-above energy strategy favors alternative and renewable sources and discourages fossil fuels, a US House committee chairman charged. “It’s actually simple: Any energy made above ground counts. Any made underground doesn’t,” Oversight and Government Reform Committee Chairman Darrell E. Issa (R-Calif.) said as the committee began a May 31 hearing on the administration’s energy strategy.

“An all-of-the-above energy strategy can’t succeed on its own,” he maintained. “We need to have an all-of-the-below strategy too.”

Committee Democrats disputed his assessment, saying that US oil and gas production has grown in the 3½ years Obama has been president and his critics won’t recognize it. “I’m trying to make sure that credit is being given where credit is due. All the stats are going up,” said Ranking Minority Member Elijah Cummings (Md.).

“It upsets me that this president is being given credit for nothing,” he continued. “I hear it in every committee I’m on, and it gets on my nerves. If oil and gas production increases, his critics say it’s happening in spite of what he’s doing. When the jobless rate comes down, they say it would have happened without him.”

One witness, Daniel J. Weiss, a senior fellow at the Center for American Progress Action Fund, said to most Americans, an all-of-the-above energy strategy means developing more traditional energy resources while using less of them; investing in research and development of newer, cleaner future technologies; and reducing public health-threatening pollution from producing and burning crude oil, natural gas, and coal.

“President Obama, employing the tools provided to him by the 110th, 111th, and previous Congresses, has accomplished all of these goals,” he said. “The United States is producing more oil and gas from private and federal lands. We are importing and using less oil. We are investing in efficiency, wind, solar, and other new technologies of the future. And the administration’s reductions in smog, acid rain, and toxic air pollutions will prevent up to 45,000 premature deaths annually.”

Regulatory excess

But other witnesses argued that proposed federal regulations threaten to aggravate existing serious delays. US gas production has increased, but it’s in spite of, not because of, the federal government, Michael L. Krancer, secretary of Pennsylvania’s Department of Environmental Regulation said. “We see federal policies and actions which seem to be geared toward picking selected winners and losers in the energy generation market instead of policies which foster a true all-of-the-above energy extraction and utilization process,” he told the committee.

He said Pennsylvania officials see this interference not only in the US Environmental Protection Agency and other federal entities’ treatment of and intervention in hydraulic fracturing, and the US Army Corps of Engineers’ increased intervention into natural gas pipelines and other infrastructure projects, but also in new interpretations of existing federal regulations and proposals for new ones. “The ‘all-of-the-above’ moniker actually means ‘only-the-above,’ meaning solar, wind, and nuclear,” Krancer said.

Other witnesses suggested that the federal government actually hinders instead of encourages energy production in areas it controls. “Where the federal government has the most controls, the administration has put in more obstacles to oil and gas producers,” said Kathleen Sgamma, government affairs director at the Western Energy Alliance in Denver.

“As a result, oil production has declined by 14.7% and gas increased by a scant half of a percent from fiscal 2010 to 2011, according to the Office of Natural Resources Revenue,” she continued. “Moreover, natural gas production on all federal lands declined by 27% in fiscal 2011 from its fiscal 2009 level, while gas production on state and private lands increased 28% over that time period.”

Charles T. Drevna, president of the American Fuel & Petrochemical Manufacturers, said the Obama administration’s regulatory proposals threaten to undermine energy progress that actually was achieved by ingenuity and innovation on private land. “There were no plans or policies or ‘blue ribbon’ panels involved. There were no subsidies and no government favored winners and losers,” he asserted. “Rather, the drastic turnaround came in areas and sectors where the government could not stand in the way of market incentives to find and produce more supply.”

Drevna suggested that the federal role should not be to manage the oil and gas industry, but to provide an environment which facilitates growth (and the jobs that come with it) while balancing proposed regulations’ benefits and costs. “AFPM urges Congress and the administration to consider the cumulative impact of new regulations prior to imposing them, to examine both the efficacy and cost of existing regulations, and to eliminate costly or ineffective regulations hampering American energy producers,” Drevna said.

Contact Nick Snow at nicks@pennwell.com.


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