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Clean Energy Group Issues Federal NatGas Policy Recommendations

Former Colorado Gov. Bill Ritter said President Obama "deserves credit for his resolve to take on climate change," but he added that "considerable work by the administration" remains, and a privately funded clean energy group founded and chaired by Ritter said 29 policy recommendations covering natural gas issues should be enacted.

In a 207-page report issued Tuesday, the Center for the New Energy Economy (CNEE) at Colorado State University said the Department of Interior's Bureau of Land Management (BLM) should require full disclosure of the chemicals used for hydraulic fracturing (fracking) on federal lands, have zero tolerance for methane leaks and establish stronger regulations governing water management and land disturbance.

"President Obama supports responsible natural gas production," CNEE said in its report. "Executives from the natural gas industry told [us] they value reasonable government regulation.

"On one hand, regulation can weed out bad actors, provide certainty for business planning, and improve the industry's 'social license to operate.' On the other hand, ineffective, unnecessary or excessive regulations impede production and increase costs."

CNEE's report -- "Powering Forward: Presidential and Executive Agency Actions to Drive Clean Energy in America" -- made more than 200 policy recommendations. The areas of focus included doubling energy productivity; financing renewable energy; developing alternative fuels and vehicles; and enabling electric and gas utilities to adapt to the new realities of the 21st century.

CNEE said that after a dialogue with natural gas stakeholders, its main recommendation was that trust needed to be built among the industry, government, environmental groups and the public.

"Leaders in the natural gas industry have the principal responsibility for building trust in the rapidly increasing role of natural gas production," CNEE said. "However, President Obama also has an important role to play in a constructive and informed national conversation about the nation’s energy mix and the contribution of natural gas."

Among the executive actions to improve the conversation on natural gas, CNEE said Obama should direct the Department of Energy (DOE), through its national laboratories, to conduct an analysis of the life-cycle costs and benefits of natural gas production. The group said such an analysis should be synthesized with many others currently under way.

CNEE also said Obama should issue a memorandum "to federal agencies clearly stating that the administration's policy is to ensure the prudent production of natural gas in environmentally and socially responsible ways, and to make use of existing statutory authorities to achieve this objective."

CNEE said the president should direct the Council on Environmental Quality and the Office of Science and Technology Policy to work with state regulators and the industry to develop a cost-effective national methane leak-reduction strategy. The group said the U.S. Environmental Protection Agency should also use new technologies to reduce monitoring costs.

CNEE took note of the BLM extending the public comment period for a proposed rule governing fracking on federal lands (see Shale Daily, Dec. 4, 2013). But it said the agency should encourage producers "to use regionally appropriate methods for environmentally responsible production on federal lands, while working with states and tribes to avoid duplication of efforts, to stimulate innovation, and to recognize states' and tribes' unique knowledge of the geology and other characteristics of their regions.

CNEE added that it "generally supported" the recommendations made by the Secretary of Energy Advisory Board's Shale Gas Production Subcommittee in 2011, including the full disclosure of fracking agents used in oil and gas drilling on federal lands (see Shale Daily, Aug. 12, 2011).

"Use the BLM's upcoming rule on gas production on Federal and Indian Lands to demonstrate the appropriate balance between proprietary issues and the public's right to know," CNEE said. "Ensure that the final rule clearly defines CBI [confidential business information] to ensure that non-disclosure is allowed only when the need for confidentiality is justified."

According to CNEE, several issues related to gas distribution also emerged during its dialogue with stakeholders. It recommended that the government -- specifically, the Department of Homeland Security and the Department of Transportation's Pipeline and Hazardous Materials Safety Administration -- work with industry groups to identify alternative sources of funding for states to have adequately staffed pipeline inspection programs.

"Although there have been modest increases in the number of federal inspectors in recent years, the pipeline safety inspection programs are reported to be chronically understaffed," CNEE said. "The inspection program relies heavily on states, many of which are dealing with budget shortfalls, and the prospect is uncertain for significant federal budget increases."

The group also recommended faster permitting of pipelines by government agencies, including by the Federal Energy Regulatory Commission and the U.S. Army Corps of Engineers.

Similar recommendations were issued last week by the U.S. Chamber of Commerce (see Shale Daily, Jan. 15). In December, CNEE reported that of 351 bills introduced by state legislatures on natural gas issues in 2013, only 52 were enacted (see Daily GPI, Dec. 30, 2013).

Ritter, a Democrat, served as governor of Colorado from 2007 to 2011 but did not run for re-election in 2010. He was succeeded by another Democrat, current Gov. John Hickenlooper.

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