The Middletown Press (Middletown, CT)
New England’s need for more energy infrastructure isn’t going away
New England is in the midst of an energy crisis. As The Wall Street Journal recently noted, the region has been plagued by an inability to construct adequate energy infrastructure to meet demand across the Northeast, resulting in electricity rates well above the national average.
Another more visible effect of this lack of infrastructure was the arrival of a huge tanker in Boston Harbor in January, carrying Russian natural gas.
The tanker, Gaselys, brought liquefied natural gas from a facility in the Russian Arctic called Yamal, which is funded by the Russian company Novatek. The United States issued sanctions forbidding any financing of projects owned by Novatek after Russia invaded Crimea in 2014. And yet, because the Treasury Department did not prohibit the purchase of natural gas from Yamal, the Russians still ship natural gas from that location to Boston.
The United States is in the midst of record-setting natural gas production. The Marcellus and Utica shale formations in the Appalachian Basin hold a wealth of natural resources that can heat homes throughout the Northeast, as well as provide feedstock for electricity generation and power the region’s manufacturers and businesses.
Even though the United States exports natural gas to markets around the world, we still have trouble delivering domestic supplies of oil and natural gas to our own country. Adequate midstream infrastructure is required to transport those resources from production centers to end markets. Until that infrastructure is in place, the U.S. will be forced to rely on foreign imports … even exploiting legal loopholes with our eyes wide open.
Regulations and political opposition slow the creation of new energy infrastructure, with companies spending years trying to get pipelines approved. The process is too long and expensive.
Domestic energy production is at a peak, thanks to American ingenuity. When U.S. production pushed prices down a few years ago, the Organization of the Petroleum Exporting Countries (OPEC) famously flooded the market with more oil, hoping to drive shale operations out of business. But domestic producers became more efficient and are now thriving, threatening former top dogs like Saudi Arabia and Russia.
The United States is using this domestic energy surplus to outflank our political rivals. For example, Russia wants to build a natural gas pipeline to Germany. This would have been hard to challenge before the United States began generating surpluses of energy to export. But in late January, Secretary of State Rex Tillerson announced U.S. opposition to the pipeline, saying it would threaten European stability. With our ability to export natural gas to Europe, Russia knows this is no idle talk from the Secretary of State.
But we still don’t have enough infrastructure to move that energy to the parts of the country where demand exceeds supply. We can fix that. By streamlining the bureaucratic process for energy infrastructure projects, the federal government could boost domestic production, making our country less reliant on foreign imports.
Sometimes one simple fix can bring a big payoff. This is one of those times.