Obama’s Clean Power Plan set to give energy sector huge boost by increasing natural gas sales

Comments yesterday from the White House press secretary illustrate nicely the confused thinking about energy on the part of the Obama Administration.

White House Principal Deputy Press Secretary Josh Earnest.

White House Principal Deputy Press Secretary Josh Earnest.

White House press secretary Josh Earnest told reporters the President opposes ending the four decade-old ban oil crude oil exports. Earnest accused Republicans of trying to “cozy up to oil interests” by pursuing policies that benefit the oil industry and he urged them to support renewable energy instead.

There are two significant problems with Earnest’s flawed logic.

First, because they generate electricity, renewable energy technologies like wind and solar compete with coal, not oil. Almost no oil (about one per cent of total fuel used) is used to create power in the United States.

Instead, oil powers the transportation sector. Three-quarters of the 18 million barrels a day of oil consumed in the US enables your commute to work, public transit buses, long haul truckers bringing fresh produce to your supermarket, and so on.

And electric vehicles are not even close to being an alternative to the internal combustion engine. EVs are expensive (the Tesla Model S is over $70,000) and have a short range (the Tesla gets under 300 miles to a charge, the Nissan Leaf only 84 miles).

Keystone XL

President Barack Obama.

Two, President Barack Obama’s signature climate change policy – the Clean Power Plan, which is essentially a war on coal – will be a huge boost to domestic natural gas producers.

The federal government’s own Energy Information Administration modeled the effect of the Clean Power Plan on American power generation and found that in all scenarios over the next 15 years, as coal use declines, natural gas consumption will rise significantly, supplemented by smaller amounts of wind and solar. After 2030, renewables will grow more quickly than natural gas generation.

Who, then, is really cozying up to the oil and gas industry? The Obama Administration just sounded the death knell for the American coal industry and handed shale gas producers a significant new piece of business the Republicans could probably never hope to match.

Perhaps someone should check for the names of the Koch brothers on the President’s donor list?

electric-vehicles-FocusAnd keep in mind that should EVs replace ICEs the electricity grid would need to expand significantly to provide the extra power.

Can you imagine the chaos and potential for economic disruption if the White House forced consumers to abandon oil and adopt EVs at the same time American utilities were being forced to abandon coal and adopt the combination of natural gas/wind/solar?

The President and his staff need to reset their thinking about American energy.

Natural gas producers are key to the Clean Power Plan. Oil producers are indispensable for transportation until a better technology is ready for primetime.

Those indisputable facts make the “oil interests” partners, not enemies, of the American government.

Josh Earnest and his boss would do well to remember that.