In the Pipeline: 7/27/11

It was the best of times, it was the worst of times — the tale of two states and their use of natural gas Wall Street Journal (7/26/11) reports: Politicians wringing their hands over how to create more jobs might study the shale boom along the New York and Pennsylvania border. It’s a case study in one state embracing economic opportunity, while the other has let environmental politics trump development…The Marcellus shale formation—65 million acres running through Ohio, West Virginia, western Pennsylvania and southern New York—offers one of the biggest natural gas opportunities. Former Pennsylvania Governor Ed Rendell, a Democrat, recognized that potential and set up a regulatory framework to encourage and monitor natural gas drilling, a strategy continued by Republican Tom Corbett…More than 2,000 wells have been drilled in the Keystone State since 2008, and gas production surged to 81 billion cubic feet in 2009 from five billion in 2007. A new Manhattan Institute report by University of Wyoming professor Timothy Considine estimates that a typical Marcellus well generates some $2.8 million in direct economic benefits from natural gas company purchases; $1.2 million in indirect benefits from companies engaged along the supply chain; another $1.5 million from workers spending their wages, or landowners spending their royalty payments; plus $2 million in federal, state and local taxes. Oh, and 62 jobs…Statistics from Pennsylvania bear this out. The state Department of Labor and Industry reports that Marcellus drilling has created 72,000 jobs between the fourth quarter of 2009 and the first quarter of 2011. The average wage for jobs in core Marcellus shale industries is about $73,000, or some $27,000 more than the average for all industries.

Do you think it is possible that Bill Daley took a look at a map and figured out that all the voters he wants in 2012 would hate this idea? E&E News (7/27/11) reports: Controversial new U.S. EPA standards for smog won’t be ready this week, the agency said today, as business groups and other critics on Capitol Hill pushed the White House to declaw the rules that were submitted for final review earlier this month…Administrator Lisa Jackson is getting ready to finalize new air quality standards for ozone, the main ingredient in the smog that can blanket big cities on hot summer days. She told a federal court that EPA would be done with the national standards by July 29, but they won’t be ready by then, said Brendan Gilfillan, the agency’s press secretary, in an email…It is the latest delay for the standards, which were proposed in January 2010. A final decision will be made “shortly,” after the rule clears the interagency review process led by the Office of Management and Budget, Gilfillan said…The process has prompted intense lobbying from industry groups and environmentalists. John Engler, a former Republican Michigan governor who is now president of the Business Roundtable, wrote in a Wall Street Journal op-ed today that a crackdown on ozone would cost $20 billion to $90 billion annually, making it “the single most expensive environmental regulation in U.S. history.”…Those concerns were echoed in a letter yesterday from 34 senators, most of them Republicans.

Flow, baby, flow — House passes bill that forces the State Department’s hand on the Keystone XL Pipeline Wall Street Journal (7/27/11) reports: The House of Representatives on Tuesday voted to speed up the decision-making process for a controversial oil pipeline that TransCanada Corp. wants to build from Canada to Texas…In a vote of 279-147 Tuesday, the House approved a bill that forces the Obama administration to either approve or deny the Keystone XL pipeline proposal by Nov. 1. The pipeline, if constructed, would stretch nearly 1,700 miles and cross six U.S. states. Among them are Montana, Nebraska and Oklahoma…The U.S. government has been reviewing the Canadian company’s pipeline since the end of 2008. The Obama administration has vowed to make a decision on its construction by the end of this year…The White House said in a statement Monday that the imposition of a Nov. 1 deadline is “unnecessary” and “could prevent the thorough consideration of complex issues.” The Democrat-controlled Senate is also unlikely to approve the bill…Environmental groups oppose the Keystone XL pipeline, in large part because it would transport a type of oil known as tar sands oil. The groups contend the process of producing this type of oil causes more damage to the environment than traditional oil. The groups also say tar sands oil is more corrosive to pipelines and present a greater risks of leaks.

Friend of the cause, Nick Loris explains that Americans are energy dependent…on the government for subsidies Heritage (7/27/11) reports: Americans are becoming too energy dependent. But it is not dependence on foreign sources of energy that is the problem; it is growing dependence on the federal government. According to the Energy Information Administration, the United States spent $8.2 billion on energy subsidies in 1999. That spending more than doubled to $16.6 billion in 2007, and with the stimulus funding and other provisions, it promises to have a much higher price tag in the years ahead. With direct expenditures, targeted tax breaks, mandates, loan guarantees, and other preferential treatment, Washington is deciding how Americans produce and consume energy. Increasing America’s access to energy resources creates competition, lowers prices, drives innovation, and creates economic opportunity. Subsidies do the opposite. Congress should make it a priority to ensure that no new subsidies are put in place and remove the ones already in place…What Are Subsidies and Why Are They Harmful?…In public policy, subsidies come in many shapes and sizes and are thus often difficult to define comprehensively. The definition “direct transfer of money to a group or industry” is too narrow, so for the purpose of this paper, a better definition is “Using the political process to support the production or consumption of one good over another.”

See, this is the sort of ‘transformative change’ Barry kept talking about.  These poor people, like everyone else, thought he was kidding Baltimore Sun (7/26/11) reports: Baltimore Gas and Electric stood by its PeakRewards program Saturday, even as participating customers’ tempers continued to flare after thousands of air conditioning units were turned off for hours as part of the energy-saving program during the intense heat of the day before…The extreme heat triggered the first “emergency event” in the four-year history of the program, and the effects were different from what customers had come to expect — many wondered why they couldn’t override the shutdown. Without air conditioning for up to 10 hours, many customers’ homes reached 90 degrees and higher. In the past, air conditioning has only been turned off for a few hours at a time…Customers had trouble getting through to BGE’s customer service line and were confused when online records said that the air conditioning had been turned back on, even though it had not.

Governor Moonbeam almost sounds like a man here.  Makes you wonder if Linda Ronstadt made a mistake.  But it really makes you wonder what could be accomplished if his focus was better E&E News (7/26/11) reports: California Gov. Jerry Brown yesterday promised to overcome those working to block widespread renewable energy…”When local communities try to block installation of solar like they did in San Luis Obispo, we act to overcome the opposition,” Brown (D) said, referring to the city where environmental groups have been protesting two large-scale solar plants over environmental and endangered species concerns…”In Oakland I learned that some kind of opposition you have to crush,” the former Oakland mayor said. “You can talk, but you have to move forward.”…Brown’s goal, being fleshed out this week at an invitation-only conference at the University of California, Los Angeles, is to build 12,000 megawatts of distributed renewable energy, building on and extending former Gov. Arnold Schwarzenegger’s target of 5,000 MW by 2020…Local, small-scale solar, biomass and other renewables avoid the need for expensive transmission lines, Brown said, and, at least in theory, don’t take as long to build as traditional utility-scale projects…The two-day conference at UCLA is a far cry from Republican Schwarzenegger’s star-studded events that focused on brokering “subnational” agreements.

“as a result, all may not survive.”  Are you sure?  Because the really smart guys from Harvard – you know, the Administration appointees who are destroying the Nation – keep telling us that these guys are money Boston (7/26/11) reports: In Massachusetts – one of the leaders in alternative energy policy – it is far from monolithic. The state counts at least 1,200 companies spread across several industries, from new-age batteries, to fuel made from plant waste, to technologies that help business and households use electricity more efficiently…That diversity has been promoted by state and federal leaders offering subsidies to alternative technologies of all kinds, and pushing mandates to encourage their adoption. But the sector, which has depended heavily on government support, could be reaching a crossroads as Washington moves to slash multitrillion-dollar deficits, and states deal with their own tight budgets…Just over a week ago, executives from several local alternative energy firms traveled to Washington to meet other industry leaders and discuss challenges to the sector, including competition for financing. Among the concerns: the future of ARPA-E, a federal agency that has doled out hundreds of millions of dollars to advanced energy projects across the country since 2009, and tens of millions in Massachusetts…“One of the big challenges with the federal budget is whether ARPA-E is going to be funded,’’ said Peter Rothstein, president of New England Clean Energy Council, a trade group in Boston…Ultimately, both government and venture capitalists may need to abandon scattershot approaches that seed an array of firms and begin to target investments – analyzing which companies, industries, and activities may have competitive advantages to succeed. As a result, all may not survive.