Issue of the week: Natural Gas

The United States continues to see breakthroughs in natural gas: Not only in the multiple shale formations around the country, that are producing volumes of fuel large enough to transform the nationwide energy outlook, but also in Washington, where the White House recently issued a report outlining the multiple economic and environmental benefits of natural gas.

“The surge in domestic natural gas production can lower energy costs, reduce pollution and drive investment,” the new report states.

Those of us advocating for energy policies that work for working Americans have long known about the natural gas boom, and we have appreciated its significance. But because so much of our energy security depends not just on the resources in the ground but on the policies out of Washington, we celebrate this public recognition of this important natural resource.

The White House report, Investing in America: Building an Economy that Lasts, was written to outline the best strategies for accelerating job growth and rebuilding an economy based on “investment, production and innovation.” It cites natural gas several times in its 14 pages, noting the dramatic change over the past decade that has turned the United States from a country building facilities to aggressively increase its natural gas imports, to one that has enjoyed a 24% increase in domestic natural gas extraction since 2006.

More important, the report connects the dots, showing what this massive increase in production of affordable, domestic natural gas means to the economy and the employment picture. It notes that natural gas supports energy-intensive manufacturing, one of the sectors of the economy hardest hit by the downturn. Affordable fuel makes American industry more competitive.

Today’s natural gas industry contributes $385 billion to the national economy. It supports millions of U.S. jobs directly and indirectly and is adding jobs at a much faster pace than the overall economy. On a microeconomic level, one report finds that the rise in affordable natural gas has returned almost $1,000 a year in disposable income to the typical household.

And, while the White House report makes reference to some of the most productive shale formations like the Marcellus Shale, it arguably does not sufficiently credit shale for the game-changing role it has played in the natural gas industry. As recently as the year 2000, shale accounted for just one percent of natural gas production. Today, it accounts for about 20% of our natural gas and that could grow to 50% by 2035.

With the White House’s recognition that increased natural gas supplies have been a boom to our economic recovery, we urge the Administration and Congress to now support policies that enhance the ability to find and develop shale gas resources. Clean, affordable, and plentiful supplies exist right here in the United States. But, what we need now are clear, thoughtful policies that support the long-term development of these vital energy resources.