Facebook Instagram Linkedin RSS Twitter Youtube

2012 Saw Record High Gasoline Prices, What does Lucky ’13 have in Store

After a record year in 2012, gasoline analysts see lower gasoline prices in 2013. AAA reported the annual average price of gasoline in 2012 set a new record at $3.60 per gallon nine cents more expensive than the previous high of $3.51 in 2011. AAA is optimistic 2013 will not be a record repeater.

In 2012, the average household consumed some 1,140 gallons of gasoline for an annual average cost of $4,112. This was just slightly below the record $4,127 that an average household spent in 2011, when it consumed approximately 1,174 gallons of gasoline. AAA continues to expect that the national average price in 2013 will be less expensive than the record average in 2012, and analysts continue to predict that demand destruction is likely to persist even with a recovering economy.

Analysis from Consumer Energy Alliance finds the two year trend for gas prices is up, up 30% in fact.  Pair rising prices with just 2% increase in annual income and gasoline becomes a growing burden on the family budget.

Motorists shouldn’t hold out hope for a major reduction in price unless the United States can increase its refinery capacity and take significant steps towards energy independence, says Consumer Energy Alliance Ex-VP Michael Whatley. “The biggest obstacle is policy.”

A recent CEA report notes the United States is on pace to overtake Saudi Arabia as the world’s number one producer of oil. This is a positive sign considering there is only an increase in demand globally. However a shrinking capacity in the U.S. to refine oil into gasoline as well as bottlenecks in transporting crude to refineries are keeping prices here high. Today there are 144 operating oil refineries in the United States down from 301 in 1980. (Source).

Inaction by lawmakers in Washington D.C. is also hurting prices. Congress has yet to effectively address the Administration’s restrictions to domestic resources such as opening federal lands to exploration or expanding sites in the Outer Continental Shelf for exploration. Leaders like Virginia Governor Bob McDonnell are actively lobbying Congress to rewrite the current leasing plan to include exploration off Virginia.

Down the street from the U.S. Capitol, the U.S. Environment Protection Agency has stated it has the authority to implement a low carbon fuel standard (a carbon emissions cap aimed at gasoline and diesel engines), which would more than double the already sky-high gasoline prices.

Policy and the economy are not the only factors. Natural disasters, similar to Hurricane Sandy which devastated parts of the East Coast, can have significant impact on gasoline prices, especially if a disaster forces the idling of refineries as Hurricane Isaac did in 2012.

As AAA notes:

The largest one-day change in the national average in 2012 was on August 29 when prices surged by nearly five cents per gallon the day after Hurricane Isaac made landfall on the Gulf Coast.

Policy makers in Washington + Mother nature = uncertain future for gasoline prices.

New Investment from Shell Could Boost Production

From the Anchorage Daily News:

Alaska’a Arctic Is Key To North American Energy Self-Sufficiency: In an op-ed recently published in the Anchorage Daily News, CEA-Alaska Communications Director Mary Ann Pease wrote about the 160% increase in the cost of regular gasoline since 2002 and the role of Alaska’s Arctic in achieving increased price and supply stability.  Alaska’s annual contribution to global energy supply has fallen 44% from 377 million barrels of crude oil (2002) to an estimated 210 million barrels (2012).  Alaska’s resources will play a key role if North America is to achieve energy self-sufficiency by 2020, but roadblocks include state tax and fiscal policies and federal overreach into state resource development.  This op-ed also ran in the Alaska Journal of Commerce.

COMMENTARY: Shell’s Arctic effort can stem production decline

MARY ANN PEASE, GUEST COMMENTARY

Dec 27, 2012 – 10:27 AM AKST

In 2002 a gallon of regular gasoline cost U.S. consumers $1.44. Ten years later that same gallon cost $3.65, a 160 percent leap. U.S. median household income increased 20 percent during the decade. A recent “Frontline” TV show on PBS noted that some families in America are choosing between food for the children and gasoline for the family vehicle. Energy costs are taking a larger share of the family budget than ever before.

The vast majority of changes to retail gasoline prices are due to changes in crude oil prices that are driven by worldwide supply and demand. Alaska’s contribution to global energy supply dropped from 377 million barrels of crude oil in 2002 to an estimated 210 million barrels in 2012. Had Alaska production remained steady, $16 billion in additional annual economic activity would exist here at home, contributing to jobs and increasing price and supply stability. Instead, that $16 billion in cash is exported each year to prop up foreign regimes.

This astounding 44 percent decline in oil production, while other energy producing provinces thrive, sends a clear and convincing message that state and federal policies are out of whack with the best interests of energy consumers in Alaska and the U.S. Consumer Energy Alliance, or CEA, believes North America can achieve energy self-sufficiency by 2020.

CEA’s “New Energy Future” report provides a path to use new technologies to increase conventional and alternative energy supplies as well as improve efficiency to reach that goal.

Alaska will play a key role in achieving self-sufficiency. With over 50 billion barrels of recoverable oil, untold amounts of natural gas, and millions of tons of mineral resources required to develop alternative energy sources, Alaska’s onshore and offshore resources rival those of any place on the planet. Roadblocks include state tax and fiscal policies — which everyone seems to agree need modification — and mindboggling federal overreach into state resource development. 

While opposition to onshore oil field development in such places as the Arctic National Wildlife Refuge seems to be falling off a cliff as science replaces emotional appeals (Alaskans want it, the caribou like it, and America needs it), offshore Arctic exploration faces greater challenges. For those who favor domestic jobs, energy, and scientific research, this is particularly vexing since drilling in Alaska coastal waters began in the 1960’s and has occurred with no associated irreparable harm.

Technology continues to improve. Investments in environmental and personnel safety have exploded. Permitting processes are more stringent than anywhere in the world. Cultural, subsistence and societal concerns are now addressed before any activity occurs. While Alaskans have a right to expect due diligence with respect to these issues, they also have a right to expect progress on providing economic opportunities and bringing domestic energy supplies to market.

Royal Dutch Shell’s Arctic offshore experience is demonstrative of an effort where all Alaska stakeholders — consumers, students, labor unions, businesses, governments, local communities, environmental groups— can work together to advance the best interests of the economy as well as the global environment. After spending over $5 billion and years of effort, Shell came tantalizingly close to completing exploration wells this year, but extreme caution, adverse sea ice conditions and certification issues for an oil spill containment vessel thwarted a well-organized and fully mobilized drilling effort.

While Shell now has all necessary permits to drill and will have a fully certified fleet of vessels for the 2013 drilling season, drilling opponents may continue to attempt to derail this properly permitted and extensively vetted exploration activity. It is unclear why these national and international groups want to force offshore exploration out of Alaska to parts of the world where permitting lacks environmental, scientific, and regulatory rigor.

While oil and gas exploration in Alaska is expensive and protracted, all Alaskans, especially young Alaskans, should welcome the opportunity to take on this challenge of demonstrating to the world how to do this correctly. Alaskans need to support a robust drilling program in the Arctic.

Mary Ann Pease is the Communications Director for Consumer Energy Alliance Alaska, and has been involved in local energy issues for over two decades. You can reach CEA at consumerenergyalliance.org.

 

CEA Urges Governor Heineman to Approve Keystone XL for Benefits to Nebraska

Final route avoids significant environmental impacts while maximizing economic benefits

Houston, TX:  Today, Consumer Energy Alliance (CEA) issued the following release regarding the Nebraska Department of Environmental Quality’s transmittal of the Final Evaluation Report on the Keystone XL Pipeline to Governor Heineman earlier today:

“We commend the Nebraska Department of Environmental Quality for its dedication to a thorough, scientific-based evaluation and for its consistent engagement with landowners and the public throughout this process and call on Governor Heineman to approve the new route through Nebraska.”

“CEA is pleased to see that the re-route process has clearly and effectively resolved concerns about impacts to the environmentally sensitive Sand Hills region. Not only does the report reaffirm that the project will have no significant environmental impact, the report also concludes Keystone XL will provide significant benefits to the Nebraska economy including $465 million in new spending within the state and an additional $390 million in gross state product. It will also support more than 4,500 high paying jobs and provide much-needed revenues to both the State and local governments.”

“We hope that Governor Heineman will, after a thorough review of the NDEQ report will approve the new route and allow the federal review of this project to move forward.”

2012 Sets Record High For Gasoline Prices

The Wall Street Journal reports on AAA fuel price data and finds the price of a gallon of gasoline rose $.09 in 2012 to an average of $3.60 a gallon.

From the Wall Street Journal:

The national average price of for the year was $3.60 a gallon, a significant jump from the previous record of $3.51 set in 2011. While 2008 is famous for a huge summer spike that drove the average above $4 a gallon, price weren’t as consistently high as this year, leaving 2008 in third place overall at $3.25.

“Record high gas prices have made this the most expensive year yet for motorists,” said AAA spokesman Avery Ash. “Factors as volatile as major hurricanes, refinery outages and tension in the Middle East resulted in significant frustration for people filling up their cars.”

New York State Report Finds Fracking Safe

A report in the N.Y. Times uses the words “safe” and “hydrofracking” in the same sentence.  The analysis conducted by the State of New York has not been publicly released, but New York’s Governor Andrew Cuomo, is due to make a decision on whether to allow fracking in New York.

From the N.Y. Times:

ALBANY — The state’s Health Department found in an analysis it prepared early last year that the much-debated drilling technology known as hydrofracking could be conducted safely in New York, according to a copy obtained by The New York Times from an expert who did not believe it should be kept secret.

…..

The assessment obtained by The Times finds that fracking can be done safely within the regulatory system that the state has been developing for several years.

“By implementing the proposed mitigation measures,” the analysis says, “the Department expects that human chemical exposures during normal HVHF operations” — short for high-volume hydraulic fracturing — “will be prevented or reduced below levels of significant health concern.”

The President Has Energy on the Mind

President Obama continues to reference energy policy as a priority.   When speaking about Congress acting on fiscal cliff legislation the President noted:

“Companies will continue to receive tax credits for the research that they do, the investments they make, and the clean energy jobs that they create.”

The President later noted:

“We can settle this debate, or at the very least, not allow it to be so all-consuming all the time that it stops us from meeting a host of other challenges that we face: creating jobs, boosting incomes, fixing our infrastructure, fixing our immigration system, protecting our planet from the harmful effects of climate change, boosting domestic energy production, protecting our kids from the horrors of gun violence.”

NBC’s Meet the Press host David Gregory asked the President what would be the achievement in his second term similar to healthcare reform in the first term.

GREGORY: But I’m asking you about timeframe because, as you well know, as a second term president now, about to begin to your second term, your political capital, even having just won reelection, is limited. So what is your single priority of the second term? What is the equivalent to healthcare?

OBAMA: Number three. You know, we’ve got a huge opportunity around energy. We are producing more energy and America can become an energy exporter. How do we do that in a way that also deals with some of the environmental challenges that we have at the same time.

Climate Secretary John Kerry?

Two stories we are reading:

Houston Chronicle: At State, Kerry could push climate change action

President Barack Obama nominated Kerry to be secretary of State on Dec. 21. The post would make Kerry the United States’ chief foreign ambassador and the face of the nation’s foreign policy. It also would thrust him into big environmental policy debates over climate change as well as the controversial Keystone XL pipeline proposed to carry oil sands crude from Canada to the Gulf Coast.

Cleveland Plain Dealer: Gasoline prices will increase before the New Year’s holiday if Washington can avoid the fiscal cliff

A deal to avoid the “fiscal cliff” will be seen as good for the economy, probably helping to increase gasoline demand and therefore prices across the nation, the auto club figures. Tom Kloza, chief oil analyst with the Oil Price Information Serivce, agrees but believes Midwestern motorists could still see periodic price cuts even if Washington straightens out the mess. OPIS provides the AAA with average local, state and national prices calculated every morning from credit card sales the day before at 120,000 filling stations.

Kevin Doyle: Comprehensive energy policy needed

Kevin Doyle: Comprehensive energy policy needed
Published: Friday, December 21, 2012 at 5:04 p.m.

An important gathering in Jacksonville earlier this month underscored how urgent it is for Florida and the nation to insist that our leaders formulate a coherent, comprehensive policy for America’s energy future. The forum, featuring energy policy leaders at the local, state and national levels, explored the implications of our present approach and concluded that a continued rudderless energy policy will lead nowhere fast.

For us in Florida, this isn’t merely an academic exercise. Energy is a key ingredient in everything we do as a state, and the impact of energy policy is felt everywhere. As a state that consumes more energy than it produces, Florida is often at the mercy of policies established elsewhere.

The “Energy Policy After the Election” forum, sponsored by the Consumer Energy Alliance-Florida and the JAXChamber, featured discussions of the issue from both federal and regional perspectives. Despite their different vantage points, the expert were united in their view that America is on the verge of an energy renaissance in which we can lead the world, but only if our policy makers do their jobs right.

Among the points raised at the forum:

• We are in the midst of a new energy age, brought on by leaps in technology that have made new energy resources available. However, this could all be in jeopardy if our leaders in Washington fail to adopt the right balance of pro-energy development policy and reasonable regulation.

• Nearly all our nation’s energy gains over the last few years have been due to extraction of energy resources from private and state lands. If the federal government would seriously consider reasonable access to federal lands for energy purposes, even more resources, and the jobs they create, would be the result.

• American energy independence means not only economic security, but actual national security. Consider how little influence other regions of the world would have over the United States if they couldn’t dangle their energy reserves over our heads.

• Excessive regulation could stop our nation’s energy progress in its tracks and hamper job creation. When as many as 14 federal agencies are involved in reviewing the future of energy technological advances such as hydraulic fracturing, the bureaucracy can be crippling.

Five years ago, natural gas accounted for about 39 percent of Florida’s overall fuel supply. The Florida Public Service Commission estimates that by 2017 natural gas will make up more than 54 percent. As an energy consumer state, Florida needs policies that make natural gas more plentiful and even more affordable than it already is.

A recent Consumer Energy Alliance report on “The New Energy Future” concluded that North America can achieve energy self-sufficiency by 2020 if it fully utilizes its abundant natural resources. The report lays out specific steps to reach this goal, including establishment of a coherent national energy policy.

The existing patchwork of policies limits Florida’s ability to establish a degree of energy independence. The Keystone XL Pipeline, for example, would carry petroleum from Canada to Gulf Coast refineries, which are a major source of Florida’s gasoline and diesel supply and would especially benefit from the pipeline during the uncertainty of hurricane season. At the same time, greater natural gas production through eased restrictions on hydraulic fracturing would expand supplies of Florida’s predominant fuel source.

But without a comprehensive energy policy, these sources, so important to our energy future, must be fought over, time and time again. As the Jacksonville panelists noted, everyone would benefit from a comprehensive policy; and the time to put such a policy in place is rapidly passing us by.

Kevin Doyle is executive director of the Consumer Energy Alliance-Florida, the state affiliate of a national nonprofit, nonpartisan organization that seeks to improve consumer understanding of America’s energy security.

Afternoon Energy: How Will An Obama Second Term Impact Energy Prices?

The empty chair at the fiscal bargaining table: American Energy

The empty chair at the fiscal bargaining table: American Energy The pathway to economic freedom is the maximization of America’s energy resources.

by Adam Waldeck

As the political class and talking heads in Washington argue back and forth over whether or not to raise taxes to avert the “fiscal cliff,” we may be missing the larger point.

As we look for a long-term solution to our country’s long-running recession, policy makers in Washington would do well to understand that there is no surer path to prosperity, now and for years to come, than by maximizing the development of American energy.

This is true for both Georgia and the United States as a whole.

Leave aside the rest of the energy portfolio, and just think about oil and gas for a moment.

Due to recent technological advances in production, the International Energy Agency says the United States is set to become a net exporter of natural gas by 2020 and almost completely self-sufficient by 2035. And when you include our North American neighbors, we’re set to become a net oil exporter by 2035 as well.

Our challenge is clearly not a resource problem; it’s a government problem and so it depends on what choices we make as a nation.

For example, when the Bakken Formation was discovered in North Dakota, 25 times more oil was found than was originally estimated. But that’s because this was on private land where innovators and entrepreneurs were free to explore and develop.

According to the New American Energy Opportunity Foundation, 91 percent of undiscovered resources on federal lands are inaccessible or restricted, a mere 6 percent of onshore mineral estate is leased, and it’s hardly better offshore, where it’s only 20 percent.

Looking at those numbers, it’s not difficult to understand why Citi Investments believes the main obstacles to a North American oil surplus are actually political rather than geographical or technological.

While this problem is obviously hampering our ability to immediately develop American energy, it’s also preventing the creation of sustainable, well-paying American jobs, real economic growth, and enormous amounts of revenue to both the states and the federal government.

On the jobs front, a 2011 IHS Global Insight report makes the case that increased drilling activity in the Gulf of Mexico and the adoption of a “pro-active regulatory pace” could generate 230,000 American jobs, one-third of which would be generated outside the Gulf region in states like Georgia.

With such job creation comes economic activity, and by definition, revenue to the government.

If only we increased our federal lease sales back to historic levels, we could generate an estimated $1.7 trillion in government revenue over 30 years as a result of both royalty payments and current tax rates.

And such revenue wouldn’t just be for Washington, D.C.

If political leaders in Georgia successfully copied Virginia’s Democratic Senators Jim Webb and Mark Warner in their attempt to open up their offshore resources, Georgia could split the revenue from offshore energy development with Washington 50-50.

Of Georgia’s 50 percent in shared revenue, 37.5 percent would go straight to the state government, with the other 12.5 set aside for conservation, public transportation projects and the like.

This isn’t a pipe dream – it’s actually the current deal that Georgia’s neighbors in the Gulf already have.

Just imagine if the recent contentious debate over T-SPLOST hadn’t been about taxes at all, because Georgia had been collecting and saving revenue generated by offshore energy production.

And again, this only deals with oil and gas production.

Once you factor in Georgia’s leadership on nuclear power and the much-anticipated opening of Plant Vogtle units 3 and 4, you realize that the opportunities for economic growth, and all that comes with it, are almost endless for both Georgia and the nation.

So the next time you hear the pundits and the politicians in Washington debating potential solutions to our fiscal woes, let them know that there is another tried and true answer.

That answer is the aggressive and responsible development of American energy.

Mr. Waldeck is the executive director of the Southeast Energy Alliance, a Washington, D.C.-based lobbying organization for energy producers and consumer groups across the southeastern United States that advocates for an “all-of-the-above” energy policy.

The SEA is hosting the 2012 Southeast Ag-Energy Summit on Monday, Dec. 17 at the Commerce Club in Atlanta. The summit will bring together regional Agriculture Commissioners, Farm Bureaus, Agribusiness Councils, elected officials, energy consumer groups and producers for a discussion about the importance of affordable, reliable energy to the agricultural community, the challenges presented by renewable fuel and electricity, and upcoming legislative priorities for the region.

1...279280281...338Page 280 of 338

IN CASE YOU MISSED IT

© Consumer Energy Alliance