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U.S. Needs Multiple Sources to Generate Electricity

Mobile, AL was the site for the Gulf Coast energy forum. Consumer Energy Alliance partnered with PACE to host the forum on the future costs of energy in the Southeast. Speakers raised concern that the U.S. is limiting its ability to generate affordable electricity if the EPA places new restrictions on coal-based power plants.

AL.com: 

Most companies are still unpacking the contents of the 645-page proposal, but pledges to litigate have already been made. Attorney General Luther Strange said he was considering legal action to protect the state’s 16,000 coal-related jobs.

At least until next year or the earliest lawsuit is filed, power companies must consider ways to limit coal usage, the cheapest form of energy.

At the forum Thursday, Jim Compton, chief executive of the South Mississippi Electric Power Association, said the regulations push companies toward more natural gas usage — which is a mistake in his view.

“The (EPA) rule — I’m afraid — wIll bring us to a situation where we will be dependent on one source of generation that will be natural gas,” Compton said. Natural gas exploration has been a boon for the U.S.

The executives used the opportunity to envision what would happen if another wave of Polar Vortex-like cold creeped down into the deep South again. On Jan. 7, energy use climbed when the below-freezing temperatures swept across most of the country.

New England’s Cold Weather is Costing Consumers

MassLIVE.com features a guest viewpoint from Consumer Energy Alliance on the future costs of energy in New England.

Guest viewpoint: Dramatic change needed for energy consumers
June 07, 2014 
By DAVID HOLT

There’s no easy way to say this: New England’s energy future is dim. Limited pipeline capacity, federal and state regulations, and a change in the mix of electricity and heating generation are just a few of the things that exacerbated the price spikes from this winter’s polar vortex. Temperate spring weather will provide some respite from sky-high bills. However, high electricity prices may be a new norm for New England.

Experts cited limited natural gas pipeline capacity and increased demand as the primary causes for this winter’s price spikes. As the U.S. Department of Energy (DOE) concluded, a strong cold snap in January caused an increase in natural gas demand for heating, a surge that “taxed the region’s natural gas pipeline capacity, causing a run-up in regional natural gas prices.” Wholesale prices for natural gas supplies for Boston averaged $22.53 per million British thermal units (Btu) from January 1 to February 18 – a record high price that exceeded by 50% last year’s record of highest prices since 2004.

Higher utility bills aren’t too surprising in Nor’easter season. But New Englanders may be frustrated to learn that families across the Midwest and Mid-Atlantic spent much less to survive the polar vortex. Illinois residents, including Chicagoans who suffered through the worst winter on record, paid an average of $8.32 per million Btu this February while Massachusetts families paid $14.57 per million Btu – or 75% more – to heat their homes. In Pennsylvania, where production from the nation’s largest natural-gas field has led to an historic depression on natural gas prices, residential prices were 25% cheaper than the Bay State.

So, we should build more pipelines, right? Yes, expanding the region’s energy infrastructure is part of the immediate solution. The boom in oil and natural gas production in new areas, such as Pennsylvania, requires that we match that new production with new, efficient ways to send energy to consumers. Regulators across the region are evaluating ways to encourage pipeline expansion in order to militate against future price spikes and ensure New England consumer also benefit from our nation’s low cost natural gas.

However, new energy infrastructure isn’t in itself enough to protect consumers. In order to make New England truly competitive, the region will need to address head-on how it generates its electricity. A dramatic shift from coal-fired power to natural-gas has already contributed to natural gas price spikes. The Wall Street Journal recently reported that in 2000 “only 15% of the electricity used in Connecticut, Massachusetts, Vermont, New Hampshire, Rhode Island and Maine came from natural gas. That has increased to nearly 50% as coal and fuel-oil plants have been phased out to meet tighter clean-air regulations.”

Unfortunately, this problem will only get worse in the future. The DOE predicts that the New England region will retire more than 1,369MW of generation between 2013 and 2016. This figure includes the forthcoming retirement of the Vermont Yankee nuclear plant, which supplies four percent of -electricity for the entire region, and announced retirements for coal-fired plants such as Dominion’s 750-MW Salem Harbor facility. The same report estimates that 1,193MW of capacity will be added in the same period, half of it from natural gas.

Retirements of coal-fired and nuclear plants will have real consequences for New England consumers. Over-reliance on one fuel source for electricity generation leaves consumers more susceptible to price spikes. Furthermore, the retirement of baseload sources of coal-fired and nuclear power will create challenges for grid operators and could threaten the reliability of the grid.

Federal, regional and state policymakers will need to confront today and tomorrow’s energy challenges with rational, balanced solutions. Consumers and residents will also need to better understand their roles in advancing a sound energy future. We should all adopt smarter consumption behaviors, particularly in winter and summer when demand peaks. We should also strive to support a responsible build-out of our nation’s energy development and infrastructure. “Not-in-my-backyard” opposition to projects like Northern Pass Transmission, Portland-Montreal Pipe Line and Cape Wind will discourage future projects, leaving New England out in the cold.

EPA Regulations Raise Concern

Washington, DC – Consumer Energy Alliance, an advocate for energy consumers, released the following statement today reacting to the Environmental Protection Agency proposing a 30% reduction in carbon emissions from existing power plants.

Michael Whatley, an Exec. VP with Consumer Energy Alliance who once served as the staff director and chief counsel for the U.S. Senate Energy Public Works Clean Air and Climate Change Subcommittee, raised a warning flag that the regulations will disproportionately affect energy consumers in states in the Midwest and Southeast that are heavily reliant on coal to generate electricity:

We are very concerned with the numbers. In the name of ‘flexibility,’ EPA is handing the states an unfunded mandate with instructions to eliminate coal-fired generation. We need to have all options on the table – including nuclear, natural gas, renewables and coal – in order to ensure that utilities and electric cooperatives can deliver affordable and reliable electricity to America’s families, factories and farms. Unfortunately, both the level of cuts in coal-based generation and the timelines for implementation that are proposed today will cause substantial reliability concerns and will ensure higher electricity prices across the board.

Consumer Energy Alliance hosted electricity affordability forums called Powering Our Future in Nashville, TN and Columbus, OH in 2013 as part of an effort to educate state lawmakers on the forthcoming EPA regulations.

Clay Robbins, an executive with Oglethorpe Power Corporation, explained during the Nashville event the costs his company undertook complying with existing regulations:

“In order to meet existing EPA rules on SO2, NOX, and mercury, Oglethorpe Power will have more than doubled its original investment in its ownership shares of Plant Scherer and Plant Wansley by the time all of the controls are placed into service in early 2014.” He continued, “However, during the timeframe that these control systems have been under construction, emissions of each of these matters have decreased by 85% or more while generation output has significantly increased. The costs of these modifications will necessarily be borne by our consumers, many of those in rural areas who are least able to afford any additional increases in their energy bills for very marginal additional benefits.”

Consumer Energy Alliance has launched an affordable electricity petition for the public to alert President Obama and Members of Congress about their support for affordable electricity:

Policies that promote sound regulation, diversification of fuel for power generation and the efficient production and transportation of electricity help lower the cost of powering our cars, homes and businesses.  Coal, nuclear, natural gas and renewable electricity providers each face regulatory hurdles that limit their long-term certainty and impede planning.

EPA Air Quality Regulations Raise Concern

Washington, DC – Consumer Energy Alliance, an advocate for energy consumers, released the following statement today reacting to the Environmental Protection Agency proposing a 30% reduction in carbon emissions from existing power plants.

Michael Whatley, an Exec. VP with Consumer Energy Alliance who once served as the staff director and chief counsel for the U.S. Senate Energy Public Works Clean Air and Climate Change Subcommittee, raised a warning flag that the regulations will disproportionately affect energy consumers in states in the Midwest and Southeast that are heavily reliant on coal to generate electricity:

We are very concerned with the numbers. In the name of ‘flexibility,’ EPA is handing the states an unfunded mandate with instructions to eliminate coal-fired generation. We need to have all options on the table – including nuclear, natural gas, renewables and coal – in order to ensure that utilities and electric cooperatives can deliver affordable and reliable electricity to America’s families, factories and farms. Unfortunately, both the level of cuts in coal-based generation and the timelines for implementation that are proposed today will cause substantial reliability concerns and will ensure higher electricity prices across the board.

Consumer Energy Alliance hosted electricity affordability forums called Powering Our Future in Nashville, TN and Columbus, OH in 2013 as part of an effort to educate state lawmakers on the forthcoming EPA regulations.

Clay Robbins, an executive with Oglethorpe Power Corporation, explained during the Nashville event the costs his company undertook complying with existing regulations:

“In order to meet existing EPA rules on SO2, NOX, and mercury, Oglethorpe Power will have more than doubled its original investment in its ownership shares of Plant Scherer and Plant Wansley by the time all of the controls are placed into service in early 2014.” He continued, “However, during the timeframe that these control systems have been under construction, emissions of each of these matters have decreased by 85% or more while generation output has significantly increased. The costs of these modifications will necessarily be borne by our consumers, many of those in rural areas who are least able to afford any additional increases in their energy bills for very marginal additional benefits.”

Consumer Energy Alliance has launched an affordable electricity petition for the public to alert President Obama and Members of Congress about their support for affordable electricity:

Policies that promote sound regulation, diversification of fuel for power generation and the efficient production and transportation of electricity help lower the cost of powering our cars, homes and businesses.  Coal, nuclear, natural gas and renewable electricity providers each face regulatory hurdles that limit their long-term certainty and impede planning.

Shale Energy Is Helping Rural America Revive Its Economic Engine

Writing for Real Clear Energy, Consumer Energy Alliance President David Holt, discusses how shale gas development is helping to boost the economies of rural communities throughout the United States. Learn more about these stories at EnergyVoices.org.

Sarah McQuiddy says Greeley is back. She remembers 2010 when the economy was stumbling and local unemployment rate had climbed over 10%. Four years later Greeley is arriving at its watershed. The discovery of oil and natural gas in the Denver-Julesberg Basin has spurred new hiring, new investment and new business for the once jobs-strapped rural county.  

Greeley, CO is a community of 95,000 located sixty miles northeast of Denver in Weld County. McQuiddy is the president of the Greeley Chamber of Commerce. She is watching Greeley become the new destination for job seekers.

Engineers, geologists, environmental managers, laborers, electricians, welders, truck drivers are just a few of the many positions needed on the job site. Then there are the new opportunities with local businesses. Kramer’s Wedge Store in Kersey is the only stop for fuel and food between the rural Wattenberg oil field and Greeley; the store has become the most important stop for energy workers going to and from their daily jobs.

Owner Steve Kramer has had to hire more staff to run the kitchen and checkout stands.  They prepare around 500 breakfast burritos per day in addition to other breakfast and lunch foods. The store has never sold as much diesel as they have in the last few years. With all the large pickups for use in local oil field operations, Steve has even had to add additional fuel pumps in order to keep up with demand.

Colorado is not just home to new jobs, it is also home to the strictest set of environmental regulations in the country. Governor John Hickenlooper brought together industry and activists to write the nation’s strictest set of environmental regulations that protect air and water quality as well as public health. The state’s newly minted regulations will improve air quality and help reduce carbon emissions.

Back east, small towns in Ohio and Pennsylvania, many hard hit industrial towns are roaring back to life because of development in the Marcellus Shale. A similar story is being told in south Texas where the Eagle Ford Shale is transforming small agricultural communities and sleepy border towns. Job seekers in North Dakota certainly don’t have to look very long, as the states’ energy development has resulted in a U.S.-leading 3 percent unemployment rate.  

Farmers all across the nation are finding an unexpected business partner in their new neighbor: selling mineral rights and contracting to build service roads for oil and natural gas wells. The new revenue is helping farmers buy new equipment. 

Without the oil and gas wealth of neighboring counties, Little Refugio County, Texas has existed on agriculture and commerce generated by the flow of traffic from a nearby highway. But now, with production in the nearby Eagle Ford shale booming, the little community is seeing dramatic growth.

Even with no drilling taking place within the county, residents see a boost from new service companies relocating to their small town. Jobs are easy to come by, and the bigger problem they have is housing. With an influx of new residents, the town of Refugio is doing all it can to attract developers and build new homes to fill the demand.

Shale energy is an economic driver for rural America and an energy resource for the entire country. Communities being misled by special interest conglomerates like the Sierra Club and Food and Water Watch are stopping their neighbors from earning new prosperity. Advancing shale energy brings jobs, new tax revenues to fund schools and local initiatives, and it utilizes natural gas, which is helping reduce America’s carbon footprint. Any organization countering these claims is masking its true goal.   

Shale energy should be promoted. There is real prosperity to be made. The stories are real, just ask the folks in Greeley.  Today’s energy renaissance is the latest chapter in our pursuit of the American dream.  

Brian Welch Joins Consumer Energy Alliance Board of Directors

Houston, TX – One of the nation’s leading energy and risk management experts, Brian Welch, joins the Consumer Energy Alliance nine person board of directors, the organization’s President, David Holt, announced today.

Welch is a 30 year veteran in the insurance industry specializing in risk management with a focus on energy including upstream, downstream and midstream. Welch joined Wortham Insurance & Risk Management in 1994, becoming a Managing Director in 2000, and then joined their Executive Committee in 2009.

“Brian  is a seasoned expert and leader in energy and risk management that believes strongly in CEA’s mission to help ensure stable prices for consumers and improve energy security,” said David Holt. “He understands that energy development impacts everyone and knows firsthand the importance of advancing sound energy policies that will boost new investment and economic activity.”

“Dependable and affordable energy is essential to our economy, so I am grateful for the opportunity to join the CEA board of directors,” said Brian Welch. “Along with the current board members, I look forward to working with CEA to help ensure that consumers are actively engaged in the conversation about the importance of energy to the economy and how we should develop and diversify our energy resources.”

CEA is made up of over 240 member companies and over 400,000 citizens who support an “all of the above” energy policy.

Consumer Energy Alliance board members, include: Jennifer Diggins , Director, Public Affairs, Nucor Corporation, John Heimlich, Vice President and Chief Economist Airlines for America; Mark Pulliam, Treasurer, Solution Partner with Sabre Airline Solutions; David Holt, President of Consumer Energy Alliance; Troy Bredenkamp, General Manager, Nebraska Rural Electric Association; Brett Vassey, President and CEO, Virginia Manufacturers Association; and Wayne Zemke, Caterpillar, Incorporated.

Go Nuclear on an Energy Bill

Originally answering a question from National Journal, Will Midterms Move the Needle on Energy Issues?, CEA’s David Holt urges the U.S. Senate to structure an Energy debate under the same rules judicial nominees are now considered.  Go Nuclear.

National Journal: Will Midterms Move The Needle On Energy Issues?  

U.S. Senators should go nuclear on an energy bill.

What would happen if the same rules and procedures which streamline the approval of judicial nominees were applied to a debate on U.S. energy policy? The Keystone XL Pipeline would have congressional approval, overreaching EPA regulations would be kept in check, and the country would be benefiting from energy policy that works with, not against, the U.S. economy.

It’s a mad idea.

The Obama Administration is aggressively pursuing its agenda for energy and environmental regulations, some of which fail to contemplate economic impacts. Meanwhile, the U.S. Congress is stalemated, stuck in time like the Hatter in Lewis Carroll’s Alice’s Adventures in Wonderland. “There is a place. Like no place on Earth,” Lewis Carroll’s Hatter says. “A land full of wonder, mystery, and danger! Some say to survive it: You need to be as mad as a hatter. Which luckily I am.” Carroll wasn’t writing about the U.S. Senate. But, looking at what has transpired over the past few weeks in the Senate, you wonder if your Senator needs to be as mad as a hatter to be effective in the world’s most deliberative body.

The U.S. Senate is designed to be the saucer that cools the heat of a raucous U.S. House. Under Majority Leader Reid’s thumb, the U.S. Senate is stuck in a never ending, mad tea party. Fifty-eight members of the U.S. Senate, 241 members of the U.S. House of Representatives, and 78 percent of registered voters all support the Keystone XL Pipeline, but the U.S. Senate remains gridlocked.

Senate Democrats may start to feel trapped in this wonderland, unable to advance a solution for their constituents who want to see Keystone XL built. A recent poll conducted on behalf of Consumer Energy Alliance found that voters in Iowa, Kentucky, Michigan, Montana, and New Hampshire would be less likely to vote for a Democrat candidate if President Obama further delayed or denied the permit for Keystone XL. Despite the overwhelming support for the project, a congressional solution seems doomed.

The whole idea of it is just maddening.

Arkansas Lawmakers Urge Action on Keystone XL

pipeline staging yard

Little Rock, Arkansas – Members of Arkansas’ Congressional Delegation joined with state lawmakers, business and labor leaders this morning in front of 350 miles on 80 acres of steel pipeline stored at Welspun Tubular to highlight the economic fallout from ongoing delays to approve the Keystone XL Pipeline.

U.S. Senator Mark Pryor (D-AR):

“Building the Keystone XL Pipeline is a no brainer. Unfortunately, we’re still waiting on the President to approve this project. I’m pleased to be here today at Welspun to reaffirm that we’re not backing down. We’ll continue to fight for this project because building the Keystone XL Pipeline is about securing our nation’s economic future.”

U.S. Congressman Tom Cotton (R-AR):

“Approving the Keystone XL pipeline is a win for Arkansas¹s economy. The House voted to approve the pipeline last year, but unfortunately it remains stalled in the Senate, where it so far has to even be scheduled for debate. Our underground transportation infrastructure is aging and this is an opportunity to replace it with state-of-the-art pipe, built right here in the Natural State. I appreciate Welspun for hosting today¹s event and will continue to work to get the Keystone XL pipeline approved.”

U.S. Congressman Tim Griffin (R-AR):

“Hardworking Americans are ready for a real, all-of-the-above energy strategy, and building the Keystone XL pipeline will strengthen our energy security and grow American jobs. Here at Welspun in Little Rock, the project has already contributed to more jobs from additional pipe construction. Government analysis shows Keystone will add $3.4 billion to the U.S. economy. It’s time for President Obama to do the right thing for American workers and allow Keystone to be built.”

Michael Whatley, Executive VP, Consumer Energy Alliance:

“Politics at its worst has kept 3,900 construction workers off the job and it has kept this pipeline from helping America become energy self-sufficient. The small and large firms which drive the U.S. economy need access to affordable and reliable sources of energy. Delaying construction, denies energy consumers, both commercial and residential, access to affordable energy – whether that is gasoline or diesel to drive their car or truck or it is the home heating oil they use to keep their families warm during the winter.”

Consumer Energy Alliance polled in April and found 70% of Arkansas voters approve of the Keystone XL Pipeline and 46% will factor in a candidate’s position on energy issues before voting on Election Day.

Arkansas based Welspun Tubular, Inc. is one of the manufacturers tapped by TransCanada to build the 36’’ diameter steel pipeline needed to complete the fourth leg of the Keystone pipeline system. The last leg will need 3,900 construction workers to build out the 1,100 miles of new pipeline capable of transporting 830,000 barrels of crude oil a day from Hardisty, Alberta to Steele City, NE.

Consumer Energy Alliance coordinates www.BuildKXLNow.org a nationwide grassroots campaign to build support for building the Keystone XL Pipeline.

Nedy Ayala – Colorado Energy Voices

In Beaver County, PA energy politics are national

Consumer Energy Alliance Mid-Atlantic Director Mike Butler penned an opinion piece for the Shale Reporter about Beaver County, PA, energy politics in the region and the impact of shale energy development on the local economy.

Even before Beaver County, Pa. became nationally known from Shell’s announcement to build a proposed $2.5 billion cracker plant in Potter Township, energy has been an integral part of the county’s history and economy. In fact, in many ways the county stands out in the ongoing national energy debate and provides a case study for national trends in energy production, consumption and transportation.

Beaver County was at the center of early 20th century America’s industrial renaissance with its coal production and Ohio River steel mills. In 1957, Beaver County became the birthplace of commercial nuclear power.

 Like the rest of the nation, Beaver County was hit hard by the collapse of America’s traditional manufacturing might. Yet it has remained an important center of commerce with its nuclear power plant and Conway Rail Yard – the second largest rail yard in the U.S. In Shippingport, the nation’s birthplace of commercial nuclear energy generation, the Beaver Valley Nuclear Power Station generates enough electricity to power 1 million homes daily and is one of the county’s largest employers.
Now Beaver County may once again be at the epicenter of an American economic transformation.

With energy production serving as one of the fastest-growing industries and an engine for economic growth in the U.S., there is great opportunity ahead for the area. In addition to a number of local projects, all eyes have been focused on the construction of the proposed ethane cracker in the county. While still under review, that undertaking will be a major economic catalyst for the region since it would help to create a market for the state’s natural gas and provide numerous jobs.

Beaver County has already seen its share of economic upside from the early plays with Marcellus Shale production, such as county revenue from Pennsylvania’s Act 13 funding. In addition to leasing activity in the area providing tens of thousands of dollars to property owners, the area has seen a number of indirect benefits, such as increased demand at the Conway Rail Yard.

Fortunately, this economic activity has potential to reverse decades of decline in old mill cities, such as Aliquippa and Ambridge, as well as accelerate growth in places like Chippewa.

Beaver County’s assets in terms of geography, transportation and existing industrial infrastructure make investment attractive for multi-billion-dollar companies like Shell. Beaver’s industrial legacy, combined with workforce development and education, can ensure a strong and able local labor force in the region.

Outside of shale development, the county’s present energy activity and future outlook also connects to the larger national story. It has been at the forefront of the state launching its renewables program. With its thriving and diverse energy and transportation sectors, the county boasts a broad and robust national strategy that includes coal, natural gas, nuclear and renewable energy components.

Concurrent with a fierce national debate over energy policy in this election year, State Sen. Jim Ferlo (D-38) has introduced a bill, on the heels of the Pennsylvania Democrats’ platform, calling for a moratorium on shale production in the state.

With Beaver County and the state of Pennsylvania uniquely positioned for economic growth for many future generations, a number of public officials in Pennsylvania have spoken out against this legislation and potential fracking bans or moratoriums. This political fight has significant ramifications for Beaver County and the country. And we will only continue to see this unfold in local, state and national elections this year.

Arguably, what happens here in Beaver County might set the tenor and tone for this national debate. With this in mind, CEA intends to report on both the national and local energy stories, with a focus on the nexus of energy policy and politics, to help generate a balanced energy policy discussion here on Shale Reporter. With a new take on former House Speaker Tip O’Neill’s famous axiom “all politics are local,” CEA looks forward to discussing why in Beaver County all energy politics are national.

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