Oil and gas keep America, Pennsylvania competitive
As 2022 begins, the demand for natural gas and oil isn’t going away — in fact, it’s growing. As economic activity bounces back, the demand for natural gas and oil has outpaced available supply. This imbalance, combined with misguided policy decisions that create uncertainty in the energy sector, has put upward pressure on the cost of energy, all at a time when the inflation rate has reached its highest point in nearly 40 years.
What is needed now is more domestic supply and the infrastructure to deliver it, as well as smart policies at the state and federal level that support Americanmade energy.
The fact is, natural gas and oil account for nearly 70% of energy consumption in the U.S., and will remain a leading source of energy for years to come. The International Energy Agency projects that natural gas and oil will supply nearly 50% of the world’s energy in 2050.
After decades as a net energy importer, the U.S. is the No. 1 producer of natural gas and oil in the world. As a direct result of hydraulic fracturing, which is used in 95% of new wells, America has surpassed Russia as the largest producer of natural gas, with Pennsylvania ranking second in the nation, behind only Texas. Hindering energy development and infrastructure projects, however, could reverse this trend and return us to the days of relying heavily on foreign nations, many with less strict environmental and safety standards than the U.S.
Thanks to an abundance of natural gas in the Marcellus and Utica shales, Pennsylvania has, within a matter of years, transitioned to a key producer and exporter of natural gas, supporting thousands of jobs and generating billions in revenue for the state, including more than $2 billion in impact fees from unconventional wells.
Pennsylvania’s shale gas boom has also insulated U.S. consumers from extreme spikes in price such as those seen recently in Europe, which has restricted natural gas and increasingly relies on renewables for electricity. High home-heating costs are also a problem in the Northeast, where policies have prevented the expansion of natural gas pipelines.
In the U.S., about half of all households now use natural gas as their primary home-heating fuel. The shift from less clean sources of energy to natural gas for electricity generation has helped drive down carbon dioxide emissions to the lowest point in a generation, proving natural gas is a powerful tool in the fight against climate change.
Methane emission rates have also decreased. According to U.S. Environmental Protection Agency and Energy Information Administration data, average methane intensity declined by nearly 58% between 2011 and 2020 in major U.S. production regions, including Appalachia.
To build upon this environmental progress while meeting the increasing demand for energy, we need policies that encourage U.S. natural gas and oil production and maintain and expand energy infrastructure. The disruption to Colonial Pipeline’s operations in May underscored the vital importance of pipelines and our energy supply chain. People need access to affordable, reliable energy — and pipelines deliver it, safely and efficiently.
A year ago, however, the Biden administration canceled the Keystone XL pipeline, eliminating over 1,000 construction jobs. More recently, in an attempt to lower prices at the pump, the administration pleaded to OPEC+ nations to increase production while releasing 50 million barrels of oil from the Strategic Oil Reserve — a relatively small amount compared to daily U.S. consumption of more than 20 million barrels per day. These hasty and shortsighted policy decisions send mixed messages to producers and the entire industry — and don’t help consumers.
Even in this challenging new year, as we navigate COVID- 19 variants, our economy is rebounding, and so is the demand for natural gas and oil. That demand shouldn’t be met by imported energy.
In Pennsylvania and the Appalachia region, natural gas development has been a game-changer, both economically and environmentally. State and national policies that support homegrown energy not only improve access to affordable, reliable and cleaner energy but also encourage long- term economic growth and stability. As we embark upon a new year, we know from past experience that our economic and environmental outlook is brighter when the U. S. is leading the world in energy production.