Energy Value Growth Key to Solving our Energy Conundrum
(Topeka, Kansas) – The demand for energy in the U.S. is ever growing. Record-high energy costs impact our economy, national security and everyday lives. We need to find more and different sources of energy and we need to be efficient and conserve. But, we cannot ignore the essential role that American oil and natural gas must play.
An average driver who pulls into a gas station will focus primarily on the surging price of gas and gives little or no thought to where it comes from or why the price is so high. The “right place at the right time with the right asset” concept implies that the driving force for today’s seemingly high gasoline prices and good fortune for oil and natural gas producers is random luck. Today’s energy market is a result of years of bad policy and tough markets, not luck. The oil and gas industry is not the problem, but a major part of the solution.
We hear over and over again from elected officials and others that our energy problem could be solved by conserving and turning to alternative energy sources. Alternative energy sources like wind, solar, hydrogen, photovoltaic, etc. are the answer to our long-term energy needs. But these technologies are still in their infancy. Our nation must focus on energy value growth by putting our resources into the energies that optimize our energy strengths. A focus on energy value growth will bring economic growth. The technology and efficiencies of alternative energy sources must be improved in order for these sources to become a major factor in the U.S. energy mix. Until then, the world will continue to move on oil and gas.
We also hear that we should continue to import oil instead of pursuing our own reserves in areas currently under moratoria, like the areas off the east coast, west coast, eastern Gulf of Mexico, Rocky Mountain areas, and the Alaska National Wildlife Refuge. Many Americans may not realize the hidden costs of oil imports. Subsidies in many forms are paid to foreign oil producers. Many of these foreign oil producers are state-owned companies that use the money we pay them for their oil to promote anti-American ideas.
Wouldn’t it be prudent to reduce our exposure to Middle East instability, civil unrest in Nigeria, political uncertainty in Venezuela, and accidents or natural disasters anywhere in the world? It is a shame that policies deny Americans the opportunity to produce our own natural resources, further increasing our foreign dependency and vulnerability. When all other countries including those with the most rigorous environmental restrictions allow their resources to be developed, we stand alone in forbidding the development of ours.
To reduce our dependence on foreign energy sources, America must embrace all forms of American energy for the future – wind, solar, biomass, nuclear, and fossil fuels. Today, fossil fuels provide over 80% of U.S. energy supply and oil and natural gas will supply more than 60% of our nations energy needs 20-25 years in the future. The fact remains, that for the foreseeable future, oil and natural gas will be our main fuel source.
Our nation needs energy policy that recognizes these realities. We need policy that includes conservation, efficiency, alternatives, oil and natural gas. Out of absolute necessity, American oil and natural gas production must provide us with a bridge to our alternative energy future. Ignoring the problems of today while we search for that perfect tomorrow is a sure formula for economic disaster. Focusing on energy value growth will result in economic growth for our nation and demonstrate leadership in formulating sound energy policy.