Industrial customers, associations and environmental/energy efficiency activists have become unusual allies in order to press Congress and the Bush administration to take steps to bridge the gap between natural gas supply and demand, promote the construction of new gas pipelines and storage facilities and foster greater conservation and energy efficiency by consumers.
In a Jan. 3 letter to President Bush and individual members of Congress, 15 different groups joined forces to call for new U.S. natural gas policies and measures that would “strike a much-needed balance between growing natural gas demand and limited supply, while ensuring that gas development takes place in an environmentally responsible manner.”
Gas production is not keeping pace with the burgeoning demand for natural gas, the ad hoc group told the nation’s top policy makers. “While the U.S. still has substantial reserves of natural gas, we produce less natural gas today than we did 30 years ago. Production is declining in currently developed areas.”
As a result, “price pressures show no signs of abating, and may in fact get much worse, as all manner of energy consumers increasingly rely on natural gas to heat homes, fuel businesses and generate electricity,” the group said.
“We are hopeful that Congress will do the right thing and take on the natural gas issue” in the 109th Congress, Robert Marvin, a spokesman for the Consumers Alliance for Affordable Natural gas in Washington, DC, told NGI. “The problem is all the more serious,” given that gas prices have been high for a sustained period of time.
The ad hoc group called on the Bush administration and lawmakers to take action to “re-balance this important market and ensure that the environment is protected.” Specifically, the group recommended that policy makers: 1) use market-based approaches rather than direct market intervention; 2) recognize that there is no simple, single solution (a balanced portfolio of policies will be required to temper demand growth for gas, diversify national fuel mix and ensure adequate supplies); 3) identify energy policies that are environmentally sound; and 4) stress the importance of conservation and energy efficiency to reduce demand pressure on gas markets.
But increased efficiency, renewable energy and innovative fossil fuel technologies by themselves will not solve the problem, the group said. Lawmakers also must pursue new gas supply options in a timely and environmentally responsible manner, diversify domestic sources of gas supply and expand imported sources of gas, including liquefied natural gas, it noted.
“Beyond producing new gas supplies, we also need to build and maintain infrastructure needed to get the gas to market through pipelines and storage,” the broad-based group said. “Our current storage, transmission and distribution infrastructure was designed to meet yesterday’s needs, and requires investments to reflect current market realities.”
The members of the group are Alliance to Save Energy, American Chemistry Council, American Council for an Energy-Efficient Economy, American Iron and Steel Institute, Bayer Corp., The Dow Chemical Co., DuPont, National Environmental Trust, Natural Resources Defense Council, The Northeast Midwest Institute, PPG Industries, Rohm and Haas Co., The Society of the Plastic Industry, Union of Concerned Scientists and the U.S. Combined Heat and Power Association.
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