Senator Elizabeth Warren (D-MA) needs a new energy advisor. Late last week the Democratic presidential hopeful tweeted her plan to impose a nationwide ban on hydraulic fracturing and a suspension of all new fossil fuel drilling leases for offshore and public lands. She wants to ax the most promising American energy sectors on her first day in the Oval Office. The proposal may come from a place of valid concern for the Earth’s climate, but it also demonstrates a dangerous ignorance of global energy security and the U.S. economy. The harebrained scheme raises questions about Professor Warren’s fitness to serve as President.
To end the fracking phenomenon – one of America’s greatest success stories – with the stroke of a pen would bring immediate and painful consequences including unforeseen second, third, and fourth-order effects. The United States is the world’s second-largest energy user after China, relying on fossil fuels to meet 80% of its demand for everything from the cars we drive to the lights in our home also known as 'primary energy'. In terms of the U.S. electricity generation mix, fossil fuels (coal and gas) account for just over 60% of the pie, with nuclear coming in at 19%, and renewables now at 17%.
It’s no surprise, then, that this country’s oil and gas industry directly employs over 800,000 men and women and indirectly supports another 10.3 million jobs. Its hundreds of billions of dollars of investment drive an estimated 8% of America’s GDP. And U.S. oil and gas runs on fracking.
Some 65% of domestic oil and nearly 20% of gas production comes from hydraulic fracturing operations. The surge of oil and gas production since the early 2000s has pushed energy imports from 60% in 2005 to 11% today. By the end of 2020, the IEA forecasts the United States becoming a net energy exporter, thanks to the exploitation of our vast shale resources. Stopping fracking would not remove demand for petroleum and natural gas, it would simply force more energy purchases from abroad.
Europe and America’s other allies have also welcomed the shale revolution, increasing their energy security vis-à-vis predatory Petro-states like Russia, Iran, and Venezuela. Fatih Birol, executive director of the IEA (International Energy Agency), had this to say about Warren’s proposed ban:
[A ban] would have major implications on the market for the U.S. economy, for jobs growth and everything, and not good news for energy security, because for example U.S. natural gas provides a lot of security to the markets…. Up to recently, before the U.S. shale gas revolution, Russia was the country which was dominating alone the gas markets. With the U.S. coming into the picture, there is a choice, there are options for the consumers, better for energy security, for diversification
The Energy Information Administration (EIA) predicts a 6% rise in U.S. power demand by 2050, with fossil fuels comprising 78% of demand at that time. So where will this additional energy come from? Surely Senator Warren does not advocate for increasing the mining and burning of dirty coal. She has also admitted her dislike of clean nuclear power – not because of the high capital expenditure costs or lengthy construction time of new projects – but because of misplaced safety concerns. This leaves renewables with the impossible task of picking up the slack.
Consider that renewables make up just 17% of America’s electricity generation mix, with 7% coming from hydroelectric plants. Consider again that that remaining 10% of power production from wind and solar projects is variable power – meaning that due to its intermittency it only contributes to the grid when the weather cooperates. We need yet to develop cheaper, utility-scale batteries to address this problem. In fact, coal and natural gas plants are acting as base load producers – the backstop to making renewable generation possible in the United States – ramping up when the wind isn’t blowing or the sun isn’t shining.
The United States spends $6.7 billion in subsidies a year to make renewables cost-competitive with other energy sources. By contrast, fossil fuels have received under $500 million in subsidies since 2016. With the country’s debt now exceeding $22 trillion, we simply cannot afford the financial support required to make the U.S. energy sector fracking-free.
Senator Warren’s ‘plan’ – which comes straight from Alexandria Ocasio-Cortez’s school of thought and is unfortunately supported by the likes of Senators Bernie Sanders (D-VM) and Kamala Harris (D-CA) – simply doesn’t make sense. Not for our economy, not for our security, and not for our allies. Ms. Warren needs to get back to the drawing board if she wants Americans to take her candidacy seriously.chases from abroad.
Date: Sep 9, 2019