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A Consumerist, not "All of the Above," Energy Policy




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The author of this entry is responsible for this content, which is not edited by the Wilson County News or wilsoncountynews.com.
June 15, 2012 | 2,136 views | 1 comment

By Robert L. Bradley Jr.

President Obama just can't decide on Keystone XL. Earlier this year, he denied approval for the project, which would have unleashed construction of a 2,600-mile pipeline to transport oil from Canadian shales to American refineries.

Yet at a recent campaign stop in Cushing, Oklahoma, the Energy-Impresario-in-Chief said he did support the pipeline -- well, part of it. He announced a plan to fast-track Keystone's southern leg, a 484-mile track running from Cushing to the Gulf Coast.

A White House that rejects a major energy project one day, then demands fast-track approval for that same project, hasn't exactly established a coherent energy policy. What is that about half-slave, half-free?

Obama's limited Keystone approval is part of an "all of the above" energy strategy. Supposedly, his administration will support any project that will ramp up supply, bring down prices, and reduce dependence on foreign energy sources.

Sounds great. The problem is, the actual content of Obama's "all of the above" approach is heavily biased toward "green tech" and doesn't even include coal, which generates more domestic electricity than any other source.

And in the grand scheme of things, approval for Keystone's southern leg -- an estimated $2.3 billion privately funded project -- is relatively small compared to the tens of billions of dollars flowing to miniscule wind and solar.

A smarter approach is to avoid playing favorites. Unless the government has good reason to deny a project, it should be approved and allowed to compete on the open market. Let customers and private investors decide what's worth pursuing.

Here are five major steps this administration can take to move energy policy from that sham of "all of the above" to one of "consumer first."

First, avoid needless restrictions on hydraulic fracturing -- colloquially known as "fracking." This shows profound promise for developing our reserves of oil and natural gas without compromising the environment. Recent back peddling by EPA on adverse findings and lawsuits is a good start.

Lifting unnecessary restrictions would immediately boost our domestic energy supply. There's an estimated 273 trillion cubic feet of recoverable natural gas in North America and 1.7 trillion barrels of recoverable oil. That's enough to power this country for 250 years.

Second, regulators need to throttle back hasty regulation on offshore exploration imposed after the 2010 Deepwater Horizon disaster. When the Interior Department lifted its drilling moratorium , new mandates and go-slow permitting resulted in half of the pre-spill activity (15 versus 30 projects).

Third, the government must streamline permitting. Even when energy companies can initiate new projects, getting final approval can be so long and costly they end up quitting.

This means we're losing important new projects simply because of bureaucratic overreach. Today, just six percent of the country's onshore energy deposits and 2.2 percent of offshore reserves are actually being developed. That must change.

Fourth, the President needs to clean house. A number of his officials are hopelessly biased against traditional energy exploration.

Energy secretary Steven Chu once said, "We have to figure out how to boost the price of gasoline to the levels in Europe." And Obama's scientific advisor John Holdren: "More energy for its own sake (or for profit's sake) can no longer serve as the goal of national energy policy."

Chu, Holdren, and other federal officials who are anti oil, gas, and coal have no place in an administration that's allegedly concerned about pocketbook energy issues.

Finally, the White House should drop plans to levy new punitive taxes on energy development. The President's 2013 budget raises taxes on oil and gas by $27 billion over the next decade. Instead, simplify the tax code to eliminate preferential treatment and let the market sort out winners and losers.

"All of the above" is a smokescreen for good energy subsidizing bad. Government officials don't -- and can't -- know the "answer" to this country's energy challenges. They should stop trying and let consumers decide in a free and open marketplace.

Robert L. Bradley Jr is the CEO & Founder of the Institute for Energy Research and author of seven books on energy history and public policy. He blogs at www.masterresource.org.
 
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Elaine K.  
Floresville  
June 15, 2012 8:47am
 
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